EDITORIAL: Former chief justice of Pakistan Tassaduq Hussain Jillani made an interesting point about corporate social responsibility (CSR) at a symposium titled “Corporate Supervision and Regulatory Actions” in the capital the other day, organised by SECP (Securities and Exchange Commission of Pakistan).
The regulatory body has taken a somewhat soft approach to CSR so far, he said, because only listed companies are required to comply with its requirements.
Yet while he was right to call for more stringent regulations, it’s going to be important to toggle policy gradually and carefully. There are three types of corporate outfits – public listed companies, public unlisted companies, and private corporations. Rather than extending the CSR compliance net to all corporate entities at once, it would be more prudent to first include public unlisted companies and monitor their performance before coming full circle.
The former CJP’s observation was all the more welcome because it lived up to the spirit of such discussions, which, unfortunately, barely go beyond generic statements most of the time.
For example, you don’t really need to gather the brightest legal and corporate minds to remind everybody, repeatedly, of basic things like “a judiciary that upholds the principles of justice, accountability and equitable access can truly propel our nation towards economic development, regional integration” and all that. People know this. They also know that the judiciary has singularly failed in carrying out this and other parts of its duty in the right spirit. This symposium was, in fact, organised to find ways to address core issues.
Another good idea, though hardly a new one, was presented by another ex-CJP, Iftikhar Muhammad Chaudhry, calling for a clear division of responsibilities, even among courts, “so matters of companies and businesses are not delayed because the courts are busy elsewhere”.
No doubt a well-functioning judiciary, especially the one that doesn’t typically take forever to reach decisions, is critical for ensuring both local and foreign investment. But that just brings us back, once again, to the judiciary’s twin dilemmas that it’s never been able to overcome. Cases linger for years, even decades, feeding into the huge backlog that undermines the very spirit of justice.
Former CJP Chaudhry made tall claims about these problems at the time of the so-called judicial revolution one-and-a-half decades ago, even vowed to end it, yet here we are, with the problem bigger and worse than ever before.
Going forward, it wouldn’t be a bad idea to create forums where representatives of the corporate sector and judiciary can debate laws and their interpretation. Justice Jawad Hassan, delivering a keynote address titled “Evolution of Company Law Jurisprudence and role of Company Benches of the Hon’ble High Court”, explained how interpretation of the law was only half the story, and the laws themselves were equally significant.
On the surface this seems straightforward enough, but there are often numerous issues between making rules and interpreting and implementing them that are not always easily understood. And given the decrepit state of the legal machinery, it’s best to preempt as many potential problems as possible rather than waste time in litigation later.
It’s only natural to gauge the health of the corporate sector when the real economy is in very deep trouble. There is an urgent need to stimulate more investment, especially from outside, to ramp up employment and production.
And since lack of proper legal cover for corporate entities is one of the many, many problems hindering investment in the country, we can expect this phenomenon to stay on the radar for a while to come. Hopefully, this time all the debates that are now taking place will also be translated into some sort of meaningful action, otherwise we’d only be going round in circles for nothing.
Copyright Business Recorder, 2023