Govt tightens SOE board appointment and performance rules as part of governance reforms

Stricter rules now govern how the federal government names, inducts and reviews SOE boards, Profit by Pakistan Today reported, within governance reforms tied to the IMF programme. The Ministry of Finance issued revised Directors Appointment and Evaluation Guidelines on Thursday under the State-Owned Enterprises (Governance and Operations) Act, 2023. Most of the changes concern independent directors, and public officials will still sit on boards by virtue of their posts.

Under the new framework, boards must promptly notify the government of any independent vacancy and share required skills with the nominations committee. Ministries must prepare working papers at least three days before committee meetings, including SOE performance data and profiles of proposed nominees. Each vacancy needs at least three nominees, and if a board cannot pin down the required competencies in time, the committee will assess those skills itself.

After federal cabinet approval, the relevant ministry will notify appointments, and each SOE must publish them online. New appointees who lack a completed directors' training course have three months to finish it. Boards nearing the end of their term must file a detailed review at least three months ahead of expiry, comparing results with the start of the tenure. Each SOE must keep a standard register of director interests, and conflicted directors will be barred from discussion, voting and quorum on that item.