The Securities and Exchange Commission of Pakistan (SECP) has proposed Code of Conduct for members of the SECP Policy Board under which Members may not engage in a business or undertaking, outside their appointment with the SECP if private interest in such undertaking could conflict with their role at the SECP. Through S.R.O. 1077 (1)/2015, the SECP has proposed draft amendment in the Securities and Exchange Policy Board (Conduct of Business) Regulations, 2000.
The Members shall comply with the "Policy Board Members Code of Conduct" and shall sign the declaration annexed thereto at the time of their appointment to the Board.
Members' Responsibilities: The Members must carry out their work in an environment that is free from any suggestion of improper influence and take all reasonable steps to avoid being in an actual, apparent or potential conflict of interest.
All Members must take steps to ensure that any conflict of interest to which they may be subject to, does not affect, or reasonably appear to affect, a decision taken by the SECP. It is the responsibility of each Member to disclose potential or actual conflicts of interest with respect to his duties at SECP, as soon as they arise or he becomes aware of them.
No Member shall exploit, or reasonably appear to exploit, to his personal advantage any personal or professional relationships with any regulated entity or any organisation with which the SEEP may have contractual or business relationship, or an officer or employee of such organizations, it said.
No Member shall directly or indirectly involve in litigation against SEEP or has history of his / her involvement in such litigation, draft regulations said. Types of Conflict to Avoid: No Member shall participate in making any decisions at the SEEP if he could benefit from the decision. If a Member is member of a regulated entity or group he may not, during the course of his appointment as Member of the Policy Board, participate in, or attempt to influence, any decision-making of that body or group if he could benefit from the decision; or as a result of the decision, the interests of a regulated entity or group could conflict with the interests of the SECP.
It said that Members, by virtue of their position as Policy Board Members, shall not accept the services of a SECP s regulated entity on terms that are known to be more favourable than the regulated entity normally offers.
Preferential treatment: During the course of appointment with the SECP, the Members must not give preferential treatment or the appearance that any preferential treatment is being provided to any person or entity or any former employee, Commissioner or Member at the SECP.
Family relationships: Members may not influence a contract on behalf of the SECP with a member of their family; or a person or entity that the Member or a member of his family has a significant relationship with or a substantial interest in and directly or indirectly the hiring of a member of their family.
Outside engagements and activities: The Members may not engage in a business or undertaking, outside their appointment with the SECP if the private interest in such undertaking could conflict with their role at the SECP; or the Member's role at the undertaking would interfere his ability to perform at the SECP.
Involvement in SECP matters: The Members must not exercise their authority in a matter if they have a personal or pecuniary interest relating to the matter that is, or could reasonably be perceived to, conflict with the Member's ability to exercise an unbiased judgement; believe that they would be unable to render an impartial decision; or have continuing or prior associations or relationships, including family and other close personal relationships, that would reasonably be perceived as preventing the Member from rendering an impartial decision.
Lobbying: The Members shall not lobby any Member, Commissioner or employee of the SECP for, or on behalf of, a SECP's regulated entity.
After leaving the SECP as Member of the Policy Board: To avoid an actual, apparent or potential conflict of interest between any future engagements and the Members' former role with the SECP, the following principles shall apply to their activities after leaving the SECP as a Member.
Confidential information: The Members shall not use any information acquired in performance or exercise of their functions either directly or indirectly, make record of or disclose confidential information to any person or entity, unless they have been authorised to do so by law.
The Members understand that violation of sub section (1) of section 35 of the SECP Act, 1997 is an offence under sub section (2) of section 35 of the SECP Act, 1997 and attracts penalty provided therein.
The Members by virtue of their position with SECP have access to confidential information and are responsible to safeguard the confidentiality of such information that is in their possession or to which they have access to.
The Members must not use confidential information to directly or indirectly benefit themselves or anyone else; or in a business or for other activities outside their appointment with SECP. The Members must not disclose confidential information outside the SECP unless authorised to do so by law or the SECP. Confidential information may be disclosed to others at the SECP only when it is required in performance of official duties or by law. The Members must avoid discussion of a matter with any person outside the SECP while that matter is pending.
Independence: The Members must not be swayed by partisan demands, or considerations of personal popularity or notoriety; and perform the functions above fear of unjust criticism by person, party or group. Members must strive to ensure, protect, maintain and promote the independence of the SECP at all times.
Ethical Responsibilities: Appointment to the office of SECP's Board Member is a high honour and requires that a Member's conduct not only in the performance of the duties of this office but also in the everyday life should be beyond reproach. The Members must act in an honest and ethical manner when dealing with each other, business stakeholders and other third parties, to promote trust and confidence. The Members must recognise their obligation to preserve the sanctity of the laws administered by SECP and for this purpose pursue and prosecute, vigorously and diligently all matters which they oversee, it added.
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