Companies in Pakistan have been classified as moderately transparent in corporate reporting, according to the Transparency in Corporate Reporting Assessment... The post Companies in Pakistan classified as moderately transparent: TRAC 2024 report appeared first on Mettis Global Link.
February 18, 2025 (MLN): Companies in Pakistan have been classified as moderately transparent in corporate reporting, according to the Transparency in Corporate Reporting Assessment (TRAC) 2024 report by Transparency International Pakistan.
The TRAC report evaluated the top 69 Public Limited Companies on the Pakistan Stock Exchange by market capitalization, assessing transparency in key areas.
These areas are regulated under multiple guidelines, including the UNGC's 10th Principle (Anti-Corruption), the Securities and Exchange Commission of Pakistan’s (SECP) Code of Corporate Governance, ESG guidelines, and the National Action Plan on Business and Human Rights.
The assessment ranked companies based on five thematic areas critical to combatting and preventing corruption.
These areas include anti-corruption programs, organizational transparency, disclosure of key financial information in domestic operations, gender and non-discrimination policies, and corporate responsibility in human rights.
The report highlighted the lowest average score of 47.28% in anti-corruption programs, indicating partial transparency in this domain.
Overall, companies averaged a score of 7.23 out of 10 for transparency in corporate reporting, where 0 represents the least transparency and 10 signifies full transparency.
Among the top scorers were Lucky Core Industries, Allied Bank Limited, and Oil and Gas Development Company Limited, though none achieved a perfect score.
Companies were ranked based on publicly available information from their latest annual reports (2023/2024), company websites, and other accessible documents.
It is important to note that the TRAC report assesses only the extent of reporting, not the effectiveness of the practices themselves.
Therefore, a lower score does not necessarily indicate unethical behavior, nor does a higher score guarantee robust ethical standards.
The average score for reporting on anti-corruption programs stood at a mere 47.28%, reflecting partial transparency.
Colgate-Palmolive (Pakistan) Limited, MCB Bank Limited, Allied Bank Limited, and Engro Corporation Limited topped this category.
"As Pakistan navigates economic challenges, transparency and accountability are crucial for sustainable growth and investor confidence," said Mr. Kashif Ali, Executive Director of TI Pakistan.
He emphasized the need for reforms in corporate reporting practices, urging the private sector to lead by example in fostering openness and zero tolerance for corruption.
Chairman of TI Pakistan, Justice (R) Zia Perwez, underscored the importance of corporate integrity and transparency amid Pakistan's economic recovery, noting that ethical leadership strengthens not only reputations but also the economy as a whole.
The detailed recommendations in the report aim to help companies improve their disclosure practices and achieve better scores in the future.
The report on anti-corruption programs in Pakistan highlights a significant need for improvement. Companies received the lowest scores in this category, indicating poor performance in regularly reviewing anti-corruption measures.
Although many companies have whistle-blowing policies, the lack of two-way communication for whistle-blowers is a major shortcoming.
Moreover, most companies do not disclose whether they prohibit facilitation payments, which are illegal.
It's essential that these policies apply not only to employees and directors but also to third parties like agents and intermediaries to minimize corruption risks.
Regular training on anti-corruption measures and codes of conduct is also largely absent, which is vital for fostering a culture of integrity.
Transparency regarding the countries of incorporation and operation of subsidiaries is also lacking, which can enable illicit activities such as tax fraud and money laundering.
Copyright Mettis Link News
Posted on: 2025-02-18T23:28:37+05:00
The post Companies in Pakistan classified as moderately transparent: TRAC 2024 report appeared first on Mettis Global Link.
