ISLAMABAD: The Federal Cabinet has appointed six Independent Directors of Railway Constructions Pakistan Limited (RAIlCOP).
The RAILCOP was under the administrative control of Ministry of Railways (Railways Division). The Company was registered under the repealed Companies Ordinance 1984 (currently) Companies Act, 2017). It was wholly owned subsidiary of Ministry of Railways and was a Public Sector Company within the ambit of Section 2(1) (54) of the Companies Act, 2017 and Rule 2 (1)(g) of the Public Sector Companies (Corporate Governance Rules), 2013 (CGR).
Presently, the Company’s Board of Directors comprise of five ex-officio Directors and two independent Directors. The Secretary, Ministry of Railways, is Chairman of the Board. To provide the Company an enabling environment to catch up with the changing times and to make it more vibrant, market-focused and business-oriented reconstitution of the Board of Directors was essentially required.
As the Company was wholly owned by the Government, through Ministry of Railways, the Federal Government had the power to nominate all the directors on its Board of Directors under Section 165 of the Act. Furthermore, in terms of Rule 3 (1) of CGR, Directors of a Public Sector Company were required to have requisite range and skills, competence, knowledge and experience to play a proactive role and act as a key contributor to the Company’s profitability. According to the summary of Ministry of Railways, Rule 3 (2) of the CGR stipulated that the Board should have at least one third of its total members as independent Directors. Section 166 of the Act required that all such independent Directors should be selected from data bank maintained by Pakistan Institute of Corporate Governance as notified by Securities and Exchange Commission of Pakistan.
While proposing the nomination of independent directors, an attempt was made to select the independent directors with diversified backgrounds with expertise in varied areas. Compliance with Public Sector Companies (Corporate Governance) Rules, 2013 was also ensured. It was also verified that all the proposed Directors were listed in the data bank maintained by Pakistan Institute of Corporate Governance as notified by Securities and Exchange Commission of Pakistan (SECP).
The proposed constitution of the Board was submitted to the Prime Minister in the form of panels for each slot of independent directors. The Prime Minister approved, in principle, the following names for “consideration of Cabinet which had been enlisted in the order of preference: (i) Azim Adil Sheikh; (ii) Shahid Aziz; (iii) Fariduddin Ahmed; (iv) Sahibzada Mansoor Ali; (v) Arshad Farooq; and (vi) M. Muzammil Hemani.
After brief discussion, the Federal Cabinet approved names of independent directors, names of whom have already been approved by the Prime Minister.
Copyright Business Recorder, 2022
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