The Secu-rities and Exchange Comm-ission of Pakistan (SECP) has laid down new criteria for appointment of chief executive officers (CEOs) of public sector companies (PSCs) with parameters to judge financial integrity of the candidates. The SECP here on Friday issued draft Public Sector Companies (Appointment of Chief Executive) Regulations, 2019 here on Friday.
The SECP had laid down new criteria for appointment of the CEOs of PSCs including condition of premature retirement or resignation from current job of officers working in the government or armed forces for appointment as the CEOs. A selection committee headed by the concerned minister-in-charge will decide the evaluation parameters for the job in accordance with the fit and proper criteria laid down by the SECP for appointment of chief executives of the PSCs.
Highlighting financial integrity, the SECP said the financial integrity is demonstrated by a person who manages his own financial affairs properly and prudently. In assessing a person's financial integrity, the appointing authority shall consider all relevant factors that whether such person's financial statements or record including wealth statements or income tax returns or assessment orders are available. The latest Credit Information Bureau report of the person shows no overdue payments or default to a financial institution. The selection committee would see whether the person has been the subject of a judgment debt which is unsatisfied, either in whole or in part, whether in Pakistan or elsewhere.
According to the criteria for the appointment of CEO of the PSC, such person (applicant) will be treated as a defaulter if he has failed to repay his loan exceeding Rs 1 million to a financial institution or is a defaulter of a stock exchange.
Under the procedure, in case an officer working in the government or armed forces is selected for the job of chief executive, he/she would have to seek premature retirement or resign from his position.
For the appointment of chief executive in a public sector company on the nomination by the federal government, there shall be a selection committee constituted for the purpose of short-listing and recommending the suitable candidates as chief executive of a public sector company.
The composition of the selection committee shall vary with the nature of business of the public sector company, and shall comprise minister-in-charge of the Administrative Division under which the public sector company falls as per Rules of Business, 1973, as chairman and where the charge of a ministry/division is held by the prime minister, the selection committee shall be headed by a minister-in-charge/ minister of state/ advisor/ special assistant to the prime minister, as nominated by the prime minister; secretary of the Administrative Division under which the public sector company falls as per Rules of Business, 1973, as member. One to three experts having knowledge of relevant sector and experience will be nominated by the concerned minister-in charge, as member.
The SECP said the board of directors (BoD) chairman or a senior member of the BoD of the public sector company in cases where such board exists; and where such board does not exist, a person to be nominated by the minister-in-charge, as member.
The concerned ministry/division shall carry out the secretarial functions including preparation of the record of all the candidates eligible for interview, recording and circulating the minutes of the committee meeting and preparing the short list approved by the committee. Each requisitioning ministry/division shall furnish job description, eligibility criteria and skills required for the job.
The selection committee will decide the evaluation parameters for the job in accordance with the fit and proper criteria as specified. The concerned ministry/division will place a public advertisement, at least three months before expiry of the term of office of the existing chief executive, in the leading newspapers and post advertisement on the relevant websites of the Government and the respective public sector company.
The concerned ministry/division shall submit the list of eligible candidates to the selection committee and arrange interviews of the candidates short-listed by the selection committee. The chairman shall, with the approval of the selection committee, recommend a list of three to five candidates to the appointing authority.
The appointing authority may select any one of the candidates recommended by the selection committee and the appointing authority, if not satisfied with the recommended candidates, shall ask for fresh recommendations. The chief executive selected will be appointed on contract for a fixed tenure but not exceeding three years subject to the provisions of relevant law, the SECP said. In case of appointment of chief executive on nomination by a provincial government, the same procedure as specified shall apply except that the prime minister, minister-in-charge, secretary of the relevant ministry/division shall be the chief minister, minister-in-charge and secretary of the relevant department respectively of such province.
The selection committee shall evaluate the candidates for appointment to the position of chief executive based on the fit and proper criteria as specified.
It will be ensured that the principles of transparency, merit and equal opportunity are followed while making appointment to the position of chief executive and the appointment of chief executive is finalised at least thirty days before the date of expiry of the term of the existing chief executive so that the appointment is made by the appointing authority within the period stipulated under sections 186 and 187 of the Act.
The appointing authority may hire the services of an executive search agency for assistance in the appointment process, including issuance of the advertisement.
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