The decision to reduce the size of the Board of Directors of the company was taken in the recent meeting of the provincial cabinet. In this regard, the Cabinet Wing of the Establishment and Administration Department, Khyber Pakhtunkhwa has already dispatched a letter to the Industry Department.
Sharing the decisions of the meeting of the provincial cabinet held on August 9, 2019, the letter of the Cabinet Wing said the cabinet has agreed in principle to reduce the size of the Board of Directors of KP-EZDMC and directed the secretary Industries to prepare a comprehensive proposal for approval of the cabinet in line with corporate governance rules and in consultation with corporate governance cell of Finance Department so as to enhance the efficiency of the state-owned entity's BoD and its management.
Presently, the Board of Directors of KP-EZDMC has 21 members with over 70 percent representation from private sector.
The issue of the large size of the BoD was first cited by Sahibzada Saeed Ahmad, a retired influential bureaucrat in his resignation tendered from the board on October 16, 2018.
In this resignation, the retired officers have said that 21 board members, is an excessive number by any account, multiplying issues and even creating difficulties of arranging meetings due to varying schedule of members and deferring crucial agenda items for months.
The issues created due to large size led to undesirable outcomes with significant delays in achieving the major delivery targets related to the mandate of the company. He said that upon going through the best practices of corporate governance is very clear than an effective board size, whether for non-profit or for profit companies, varies from 5-10 members, including the Chief Executive Officer (CEO). However, some private sector representatives including Mohammad Adnan, Jalil and Haji Iftikhar Ahmad were not agreed with his contentions.
Other decisions of the cabinet were included post facto approval of the Board of Directors of KP-EZDMC as per Section 165 of the Companies Act, 2017, with effect from 20-11-2017 along with dissolution of previous board of Directors of KP-EZDMC with effect from the same date.
The same meeting of the provincial cabinet also accorded approval to the nomination of Saeed Ahmad as Chief Executive Officer (CEO) of the KP-EZDMC, as per recommendation by the Board of Directors of the company.
Through the dispatch, the secretary Industries for furnishing of the implementation report of the cabinet decision as required under Rule 25 (2) of the Khyber Pakhtunkhwa Government Rules of Business, 1985 on priority basis to the Cabinet Section of the Administration Department.