Corporate Governance Code

Apropos an article "The 'three' in second line of corporate hierarchy" carried by Business Recorder on February 12, written by prominent Lawyer and Corporate Counsel Qaiser Mufti criticizing substitutable duties and responsibilities of the Company Secretary and Head of Internal Audit as described in the Code of Corporate Governance of Listed Companies issued by the SECP. I partially diverge from the opinion of the writer that the Code's rule-32 is not in line with the principle of independency, among other things.
The code referred hereinabove seems to be appropriate and meets the requirements of the principles and doctrine of independency, the suggestion by the writer to the SECP to change the line/words that the Head of the Internal Audit should be routed through the CEO to the Board of Directors may influence the real jurisdictions of the job of the Head of Internal Audit and it is tantamount to departure from the conventional wisdom of independency and impartiality applicable for such nature of Job. The phrase and wordings framed in the code in question should be intact to avoid any nefarious purpose. Secondly, the three giant positions in any big institution like CFO, Company Secretary and Head of Internal Audit have integrated action in much business, financial and administrative transactions but simultaneously in some situations the applicable norms, ethics and standards provide the limits and boundaries in their interaction. For example, the CFO cannot be mixed with the job of Head of Internal Audit and that is why the code of corporate governance provides that the Audit Committee shall be held in the absence of CFO and CEO except their presence through invitation if required. So in such a condition the only option to assume the temporary charge of Head of the Internal Audit is the Company Secretary in his absence. Since the Company Secretary is like a family doctor of the Institution so his working in the capacity of Head of Internal Audit will disclose the undesirable things in audit as opined by the writer is extravagant.
However, the approach and wisdom of the writer to strengthen the ICSP for the purpose of producing the effective professionals in the field of Corporate Secretaryship is highly appreciable and cannot be denied. The SECP should not only think about it but to make the institution (ISCP) more powerful they should provide funds and have one of their representative look after this institution to produce the effective breed for future. For this purpose no further legislation is required, this can be done through executive notification or order.