Press Release

VIS Reaffirms Corporate Governance Rating of Pak Oman Investment Company Limited at CGR-9
 

Karachi, August 1, 2022: VIS Credit Rating Co. Ltd. (VIS) has reaffirmed the Corporate Governance Rating of Pak Oman Investment Company Limited (POIC) at ‘CGR-9’. The rating signifies very high level of corporate governance. The previous rating action was announced on July 16, 2021.

Corporate governance ratings are based on evaluation of key governance areas of the rated institution including regulatory compliance, ownership structure, composition and operations of the Board of directors (BoD) and executive management, self-regulation, financial transparency and relationship with stakeholders. The assigned rating takes into account a well-established corporate governance framework incorporated at POIC in the context of the Joint Venture (JV) agreement between the two sovereign sponsors - Government of Pakistan (GoP) and Sultanate of Oman (SO). Board composition is dictated by the JV agreement. The terms of the JV agreement dictate the Board composition where each sponsor nominates three directors on the Board.

The assigned ratings take into account a well-established corporate governance framework implemented at POIC adequately supplemented by effective functioning of board and management level committees. Changes at the Board level were noted in 2021 with replacement of two board members from OIA. In addition, in line with the Corporate Governance Regulatory Framework by SBP, CEO of the Company was replaced with acting CEO upon the retirement of previous one. With the change at Board level, board committees were also reconstituted. No major changes in the authorities designated to the Board Level Committee were noted, although room for improvement exists with respect to clarity and segregation of responsibilities at the Board and management levels.

Over the past few years the Company has emphasized upon and implemented green banking initiatives to promote and attain environmental compliance. However, internal mechanism for reviewing business risks and evaluating their impact may be further enhanced. Level of financial and qualitative disclosures in the public domain is considered satisfactory.

The Securities and Exchange Commission of Pakistan (SECP) has exempted JV related entities, including POIC, from Public Sector Companies (Corporate Governance) Rules, 2013 subject to the conditions that the training of directors, performance evaluation of the Board, and audit of financial statements of the companies are conducted by Quality Control Review (QCR) related firms. POIC continues to remain compliant with the provisions of the code.

For further information on this rating announcement, please contact the undersigned (Ext: 207) at (021)35311861-71 or email at info@viscom.pk.




Sara Ahmed
Director

Applicable Rating Criteria: Corporate Governance Ratings (August 2017)
http://www.vis.com.pk/kc-meth.aspx

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