Psx Honours Pakistan’s Business Champions with Top 25 Companies Awards for the year 2022

TEXT: This year, the highly anticipated list of winners for the Top 25 Companies Awards for the year 2022 was published by the Pakistan Stock Exchange. This announcement of the list of the Top 25 Companies Awards winners is keenly awaited by the trade, business, and industrial world of Pakistan. The award-winning businesses have demonstrated excellence in their financial performance, operational and governance accomplishments, sustainability, and ESG related initiatives. The companies making it to this august list are a shining example of leadership for Pakistan’s corporate sector.

Since the inception of the Awards in 1978, to qualify for the PSX Top 25 Companies Awards, the companies have to meet select criteria. These criteria have evolved over time to include those standards by which companies are judged for excellence in the eyes of investors, analysts, fund managers and others. In 2018, where the winners had to meet criteria for financial performance and corporate governance & investor relations, the same progressed in 2020 to include Sustainability and Diversity & Inclusion reporting along with financial and other considerations. By 2022, this evolved to include reporting on SDG and ESG Related Initiatives as well. In other words, almost 22% of the requirements for qualifying for this coveted award included qualitative criteria.

Specifically, for the year 2022, the requirements included, but were not limited to, having a minimum dividend distribution of 30% and having shares traded for at least 75% of the total number of trading days in a given year. After meeting these requirements, the businesses were evaluated further using a combination of quantitative and qualitative standards. PSX used quantitative standards to choose listed companies which performed exceptionally well in the context of profitability ratios, dividend related ratios, and turnover of shares, among other specifics. In terms of qualitative criteria, PSX selected high-performing listed companies based on Corporate Social Responsibility (CSR), reporting on SDGs, ESG related initiatives including Diversity & Inclusivity, among other considerations.

The qualitative aspects of a company are also crucially important for the growth and success of that company. PSX’s giving weightage to these aspects demonstrates its commitment to steer listed companies with appropriate direction for their financial growth as well as focus on environment, social and governance factors. By incorporating these standards in the Top 25 Companies’ Awards criteria, PSX encourages listed companies to travel the path of corporate success and generate interest from investors, fund managers and analysts, among others, not only at the local level but also at a global level.

Since its inception, PSX’s Top 25 Companies Awards criteria recognition for top-performing companies has evolved to align with changing economic, social, and environmental dynamics. Here are key aspects of how the criteria has evolved specially related to the SDG/ESG aspect by 2022:

Including ESG Metrics: Environmental, Social, and Governance (ESG) factors are becoming more and more important. In addition to financial success, companies are currently assessed based on their social responsibility, governance practices, and environmental effect. This is in line with a global trend in which stakeholders and investors place a higher value on businesses that use sustainable and ethical business practices. Specifically, 10% of the total weight wasthereby allocated to the criterionof ESG/ Sustainability for qualifying for the awards.

Diversity and Inclusivity: Within business frameworks, these two concepts are receiving more attention. Businesses that support diversity in leadership and cultivate a welcoming environment at work are recognised for their dedication to equality and social responsibility. Hence, Diversity & Inclusivity reporting carried a weight of 3.5% marks to be specific, in the qualitative criteria.

Overall, the evolving criteria reflect a broader understanding of what constitutes business success in a rapidly changing world. By considering a more comprehensive set of factors, PSX aims to encourage companies to adopt practices that not only drive financial growth but also contribute positively to society and the country.

PSX has also taken the initiative to sign UN Women's Empowerment Principles and joined the United Nation’s Sustainable Stock Exchanges (UN SSE) Initiative. These initiatives show a deeper commitment to sustainability, ethical business practices, and gender equality within the Exchange. Moreover, PSX makes use of these affiliations as a means of increasing public awareness, promoting discourse, and supporting listed businesses to conform to these global sustainability and gender equality criteria.

The Top 25 Companies Awards are the epitome of corporate success. The top three firms in the winner’s list for the year 2022 are Fauji Fertilizer Company Limited, Engro Corporation Limited, and Systems Limited while the remaining 22 companies solidified their status as the jewels in the crown of Pakistan’s top performers, showcasing their exceptional financial performance and strategic vision. PSX convenes the Top 25 Companies Awards ceremony to honour and recognise these top performing corporate champions.The event provides an opportunity to present these gems to the rest of the world.

As Pakistan’s economy continues to evolve, events like these will play an important role in acknowledging and promoting excellence within the business community. The recognition of the Top 25 Companies serves as an inspiration for emerging enterprises, encouraging them to aspire to the highest standards of performance, integrity and responsibility in conducting business practices. Hence, raising the performance benchmarks even higher year after year.

In conclusion, Pakistan Stock Exchange's celebration of the Top 25 Companies not only highlights the success stories of these corporations but also serves as a catalyst for fostering a dynamic and resilient business environment. The event reinforces the importance of innovation, sustainable practices, and responsible corporate citizenship in shaping the future of Pakistan's economy.

Raeda Latif

Pakistan Stock Exchange

Copyright Business Recorder, 2023