The document discusses corporate governance and the stakeholders in a company. It defines a stakeholder as anyone with an interest in the company, whether as an owner or not. The main stakeholders discussed are general shareholders, directors, employees, and creditors. It then goes on to summarize the key points of Pakistan's Code of Corporate Governance from 2012, including the responsibilities of the board of directors, requirements for board meetings, and qualifications for senior financial roles.

1. Group No 3
 Submitted to:
Mis. Saima Batool
 Submitted by:
Sana Ali
Roll No:
06

2. Some Words About Teacher
You are the best.
Wherever I go,
Whatever I do, I will
always remember
you.

3. COMPANY LAW
(CORPORATE
GOVERNANCE)

4. THE STAKEHOLDERS
A "stakeholder" is a person (including an entity
or group) that has an interest or concern in a
business or enterprise though not necessarily
as an owner.
 General
 Shareholders
 Directors
 Employees
 Creditors

5. General
Control large number of diversified minds by
board of director appointed by shareholders.
The annual report is a vital link and, in most
instances, the only link between the company
and its stakeholders.

6. Shareholders
 An owner of shares in a company.
 It is essential for a corporate governance
framework to protect the rights of all shareholders.
 A shareholder is not responsible for managing
corporate activities as responsibility for corporate
strategy and operations is entrusted with the
Board and the management team. Shareholder
rights must, therefore, focus on issues such as the
election of the Board, amendments to the
company's organic documents, approval of
extraordinary transactions in addition to basic
issues specified in the Companies Ordinance and
internal company documents.

7. Directors
 The primary responsibility for the
administration and performance of a company
lies with the directors. The directors administer
the company on behalf of shareholders and
their powers and duties are covered in the
statute.

8. Employees
 All employees have some responsibility for
implementation of effective internal control
procedures as part of their accountability for
achieving objectives. They collectively should
have the necessary knowledge, skills,
information and authority to operate the
company. This will require an understanding of
the company, its objectives, the industries and
markets in which it operates, and the risks it
faces.

9. Creditors
 Contractual stakeholders like customers,
contractors and sub-contractors are
fundamental for any corporation. A relationship
based on trust develops between the
corporation and such stakeholders and it is
normal, especially where transactions are
frequent, for credit to be extended.

10. Code of Corporate Governance
2012
 First time issued in March 2002
 Revised by SECP and issued in April 2012

11. Definition
 The Code will result in availability enhanced
information to markets participants and hence
will provide better protection of the rights of all
investors, particularly minority shareholders.

12. Composition of the Board
 The board of directors plays a central role
in the corporate governance mechanism.
 The board is responsible for ensuring that
the corporation has well-defined and
protected shareholder rights, a solid
control environment, high levels of
transparency and disclosure, and keeps
the interests of the company and those
of all shareholders aligned.

13. Maximum number of
directorships to be held by a
director
 No person shall be elected or nominated
as a director of more than seven listed
companies simultaneously.

14. Filling up a casual vacancy
 Any casual vacancy on the board of directors
of a listed company shall be filled up by the
directors at the earliest but not later than 90
days thereof.

15. Responsibilities, powers and
functions of board of directors
 The board of directors of a listed
company shall exercise its powers
and carry out its fiduciary duties with a
sense of objective judgment and
independence in the best interests of the
listed company.
 Duties And Power of directors
• human resource management
• procurement of goods and services
• investors relations including but not limited
to general investor awareness,
• complaints and communication, etc.

16. • marketing
• determination of terms of credit and discount to
customers
• write-off of bad/doubtful debts, advances and
receivables
• capital expenditure, planning and control
• investments and disinvestment of funds
• borrowing of moneys
• determination and delegation of financial powers
• transactions or contracts with associated
companies and related parties
• health, safety and environment; and
• the whistleblower policy.(exposes misconduct)

17. Meetings of the board
 All written notices, including the agenda, of
meetings shall be circulated at least seven
days prior to the meetings, except in the case
of emergency meetings, where the notice
period may be reduced or waived.
 The Chairman shall ensure that the
minutes of meetings of the board of
directors are appropriately recorded. The
Company Secretary shall be secretary to the
board

18. Significant issues to be placed
for decision of Board of
Directors
 In order to strengthen and formalize corporate
decision-making process, significant issues
shall be placed for the information,
consideration and decision of the board of
directors of listed companies and/or its
committees,

19. Directors’ Training Program
 All listed companies shall make appropriate
arrangements to carry out orientation courses
 for their directors to acquaint them with
this code, applicable laws, their duties and
responsibilities to enable them to effectively
manage the affairs of the listed companies for
and on behalf of shareholders.

20. Appointment and removal
 The appointment, remuneration and terms and
conditions of employment of the Chief Financial
Officer (CFO), the Company Secretary and
the Head of Internal Audit of listed companies
shall be determined by the board of directors.
 The removal of the CFO and Company Secretary
of listed companies shall be made with the
approval of the board of directors.
 The removal of Head of Internal Audit shall be
made with the approval of the board only upon
recommendation of the Chairman of the Audit
Committee:

21. Qualifications of CFO and Head
of Internal Audit
 No person shall be appointed as the CFO of a listed
company unless he/she has at least five years of experience
of handling financial or corporate affairs of a listed company
or a bank or a financial institution and is:
 A member of a recognized body of professional
accountants; or
 Has a postgraduate degree in finance from a recognized
university or equivalent.
 Auditor :No person shall be appointed as the Head of
Internal Audit of a listed company unless he/she has 5 years
of relevant audit experience and is:
 A member of a recognized body of professional accountants
 A Certified Internal Auditor; or
 A Certified Fraud Examiner; or
 A Certified Internal Control Auditor

22. Requirement to attend board
meetings
 The CFO and Company Secretary of a listed
company or in their absence, the nominee,
appointed by the board, shall attend all
meetings of the Board of Directors. Provided
that the CFO and Company Secretary shall not
attend such part of a meeting of the Board of
 Directors, which involves consideration of
an agenda item relating to the CFO and
 Company Secretary respectively

23. Directors’ remuneration
 There shall be a formal and transparent
procedure for fixing the remuneration
packages of individual directors. No director
shall be involved in deciding his/her own
remuneration.

24. Frequency of financial
reporting
 All listed companies shall ensure that second
quarterly financial statements are subjected to
a limited scope review by the statutory
auditors in such manner and according to
such terms and conditions as may be
determined by the Institute of Chartered
Accountants of Pakistan (ICAP) and approved
by the SECP.

25. Thank you