PSX board should conform to highest governance standards: Hijazi

Securities and Exchange Commission of Pakistan (SECP) Chairman Zafar Hijazi Friday visited Pakistan Stock Exchange Limited and met members of the Board of Directors of PSX, including the representatives of the Chinese consortium. The newly-appointed four Chinese directors of the PSX board including Que Bo (representative of Shanghai Stock Exchange), Zheng Hu (representative of Chinese Future Finance Exchange), Ms Yu Huali (representative of Shenzhen Stock Exchange) and Li Peng (representative of Pak China Investment Company) attended their first meeting with the PSX board.
During his discussions with the PSX Board, the Chairman SECP welcomed the incoming PSX Board and appreciated the contribution of the outgoing directors. The chairman desired that PSX Board should conform to highest governance standards, appointment of independent directors should be expedited and the PSX management should be strong, professional and independent.
He said PSX must focus on investor protection and risk management and for the same, the Exchange should assume the role of a full-fledged self-regulatory organisation in line with best practices, while ensuring segregation of regulatory and commercial functions. He reiterated that in line with the SECP's policy of zero tolerance towards market manipulation and unfair trade practices, PSX must focus on strong enforcement, compliance and risk management.
He elaborated on SECP's various reforms to improve risk management and hinted at strict action against anyone involved in illegal activities. In particular, he pointed out the recent constitution of a committee to review existing models of financing by brokers in light of best practices and local requirements whose report is expected shortly. He expected that the PSX Board would facilitate implementation of recommendations of the committee. Hijazi expressed the desire that the Chinese consortium play a pivotal role by ensuring a commercially driven strategy and sharing its experiences with regard to the same. A detailed three-year business plan is anticipated from PSX which should propose concrete measures for development and activation of the equity, debt, derivatives, SME and commodities markets, along-with practical initiatives for expanding market outreach and investor base.
The PSX Board appreciated the SECP efforts for creation of a fair, transparent and modern capital market, in particular the recent reforms carried out in consultation with the stakeholders, and assured the SECP of its commitment towards fulfilment of the SECP's expectations towards PSX. The SECP chairman was accompanied by senior officers of the SECP.