ISLAMABAD: The government has decided to reconstitute board of directors (BoDs) of all state run oil and gas companies in line with international best practices. The Ministry of Petroleum has laid down the criteria and according to which all public sector oil and gas companies will be required to reconstitute their boards.
Some circles say that some members of board of directors of oil and gas companies were being replaced as Special Assistant to Prime Minister Dr Asim Hussin wanted his own favourite people on board of directors. They say that those members of boards of directors were being changed who had refused to follow the plan of Special Assistant Dr Asim Hussain.
However, a senior official of the Petroleum Ministry denied these allegations and said that boards were being reconstituted just to introduce international best practices.
In the first phase, the board of Pakistan Mineral Development Corporation (PMDC) is being reconstituted and Ministry of Petroleum will move summary to the prime minister for formal approval.
Sources told The Express Tribune that those board members who have a business interest in the industry, resulting in a conflict of interest would not be made members. “The board of the PMDC is being reconstituted as the company has such members on its boards who are involved in business of mining coal and salt,” sources said.
A senior official of Ministry of Petroleum said that the board of directors of all other state run companies including Pakistan State Oil (PSO), Oil and Gas Development Company Limited (OGDC), Pakistan Petroleum Limited (PPL), Sui Northern Gas Pipeline Limited (SNGPL) and Sui Southern Gas Company (SSGC) will also be reconstituted.
According to the criteria the Ministry of Petroleum will have two representatives on the board of each company against one representative in the current system. The board of directors will comprise Chairman, MD of the company, outside chartered accountant/financial expert, outside marketing expert, two representatives of Ministry of Petroleum (1-Technical-2 Administrative), representative of Ministry of Finance, academic/Intellectual/Eminent citizen and outside technology expert.
The other conditions set for the board sate that that candidates must hold a masters degree and must not be less than 45 years of age and not older than 65 years. The candidate must not be declared bankrupt or a defaulter. It is also required that the candidate be a distinguished entrepreneur or top executive of known repute.
No member will be eligible to serve for more than two consecutive terms. The Pakistan Institute of Corporate Governance and the SECP run 8-day courses and conduct examinations in order to certify eligibility to serve on the BOM/BOD. “It must be mandatory for all respective directors to have undergone the course,” according to the new guidelines.
Published in The Express Tribune, February 14th, 2012.