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ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) now requires its approval before the appointment, renewal, or removal of the chief executive officer (CEO) of a professional clearing member.
On Wednesday, the SECP issued draft amendments to the Professional Clearing Members Regulations, 2020, through S.R.O.244(I)/2025.
New Process for CEO Appointment
The board of directors of a professional clearing member will handle all decisions regarding the selection, appointment, and terms of the CEO. The process includes the following steps:
- The Board of Directors will review three candidates who meet the “fit and proper” criteria outlined in the regulations.
- After evaluation, the Board will recommend one candidate to the SECP for approval.
- The SECP will assess the nominee’s qualifications and decide whether to approve the appointment.
- If the SECP is not satisfied, it has the authority to reject the nomination and request the professional clearing member to propose a new candidate.
Compliance Oversight
In addition to the CEO, the compliance function of a professional clearing member will be overseen by a chief compliance officer who must also meet the “fit and proper” criteria.
According to the SECP, the chief compliance officer must submit a detailed report every six months to both the Board of Directors and the Commission. This report should include:
- Issues reported during the period.
- Corrective actions taken.
- The current status of those actions.
These regulations aim to enhance transparency, oversight, and accountability in the management of professional clearing members.
