Practice Area
Corporate Governance
We design and repair the governance of Pakistani companies — boards, committees, related-party controls and the compliance calendar under the Companies Act 2017 and the SECP's codes. The aim is a company whose paper record matches how it is actually run, because sooner or later a regulator, an investor or a court will compare the two.
Corporate governance in Pakistan is usually discussed as a listed-company subject, a matter of codes and committees. That framing misleads. The Companies Act 2017 imposes duties, formalities and penalties on the directors of every company in the country, and the SECP enforces them against private companies too. The businesses that come to us are rarely trying to meet a code; they are trying to close a funding round, survive an inspection, resolve a boardroom conflict or pass a due diligence — and discovering that governance is the gate through which each of those passes.
The recurring problem is the gap between the company on paper and the company in fact. Decisions are made on a phone call and never minuted; the founder deals with the company as if it were his personal account, which under the related-party regime it is not; the registers stop being maintained in the year the business got busy. None of this feels like wrongdoing from inside, and most of it is repairable. But the Companies Act 2017 judges the record, and so does everyone else who matters — the SECP, an investor's counsel, a tax authority, eventually a court. Our work is closing that gap in both directions: repairing the record honestly, and building decision-making habits the record can keep up with.
The practice runs at two scales. For founder-led companies and SMEs, governance is preparation — the review-and-repair exercise before a raise, articles that will hold the investor's terms, a calendar that keeps the registrar satisfied. For enterprises, groups, funds and regulated businesses, it is architecture — board and committee design, related-party controls across affiliated entities, director induction and support, and navigation of the overlapping regimes of the SECP, and where relevant the State Bank and the NBFC framework. In both, the same rule applies: the structure has to fit how the business actually decides things, or it will be abandoned within a year.
We also do the uncomfortable part of governance, which is conflict. Deadlocked boards, directors who will not leave, shareholders who suspect the related-party ledger, notices from the SECP that name individuals. This practice handles those matters in the boardroom and through the regulator wherever possible; where they harden into litigation, our disputes lawyers take them forward with the corporate team still attached, because the governance record we built or repaired is usually the evidence.
The law stated on this page is as of mid-2026. The Companies Act 2017 is amended periodically, the SECP revises its codes and regulations, and thresholds and penalties move. Specific requirements should be confirmed for your company's category and regulator before acting; that confirmation is where every engagement begins.
When Businesses Need This
The moments this practice exists for.
- 01Your board exists on paper but has not met, minuted or resolved anything in over a year, and the statutory registers are blank.
- 02An investor's term sheet requires board seats, reserved matters and information rights, and your articles and practice support none of it.
- 03You are preparing to list, or to take a substantial shareholder that expects listed-company discipline, and need to meet the SECP's code of corporate governance.
- 04SECP has issued a show-cause notice — late filings, an irregular related-party transaction, or a defective AGM — and you need the position repaired, not just answered.
- 05Founders and family members transact freely with the company, and nobody has run those dealings through the related-party approvals the Companies Act 2017 requires.
- 06A director has resigned, or refuses to, and the board is deadlocked over control of the company.
- 07Your group has grown into a dozen entities and no one can say who is a director of what, or where the common seal is.
How It Works
The process, stage by stage.
1
Governance review
We review the company's constitutional documents, registers, filings, minutes and actual decision-making practice against the Companies Act 2017 and any code that applies to it. The output is a gap analysis in plain language, ranked by consequence — what is a fine, what is voidable, what is personal exposure for directors.
2
Repair
We fix what the review found — regularising filings with the registrar, reconstituting registers, ratifying or unwinding defective decisions where the law permits, and papering the resolutions that should have existed. Repair is done honestly: documents are dated when made and record what actually happened.
3
Design
We then build the structure the company needs going forward — articles that match the shareholding, a board of workable size, committee charters where warranted, a delegation-of-authority matrix, and a related-party transaction policy. Design follows the business; a startup board and a listed board should not look alike.
4
Calendar and secretarial discipline
Governance fails through missed dates more than bad intentions. We install an annual compliance calendar — meetings, AGM, filings, auditor and officer appointments — and either train the company secretary to run it or run it ourselves under a retained arrangement. Fee structure is by engagement letter.
5
Board support
For clients that keep us on, we sit with the board: agenda and paper review before meetings, minuting standards, conflicts management as they arise, and director induction. When a hard decision comes — a related-party deal, a dissenting director, a disclosure question — the advice is already in the room.
The Legal Framework
The law this work runs on.
- Companies Act, 2017
- The governing statute for every Pakistani company — incorporation, directors' duties and liabilities, meetings, resolutions, registers, filings, related-party transactions and investigations. Most governance defects are, in legal form, breaches of this Act, and most repairs are performed under it.
- Listed Companies (Code of Corporate Governance) Regulations, 2019
- The SECP's code for listed companies — board composition including independent and female directors, committees, and disclosure. Stated as of mid-2026 and as amended from time to time; unlisted companies preparing to list, or wanting listed-company discipline, adopt it in stages.
- Companies (Manner and Selection of Independent Directors) Regulations, 2018
- Governs who qualifies as an independent director and requires selection from the databank maintained under the Act. Companies that appoint a friendly outsider and label them independent usually fail these tests.
- Companies (Related Party Transactions and Maintenance of Related Records) Regulations, 2018
- Sits under the related-party provisions of the Companies Act 2017, prescribing the approvals, arm's-length justification and records for dealings with directors, officers and associated companies. This is the regime family businesses and founder-led companies most often breach without noticing.
- Public Sector Companies (Corporate Governance) Rules, 2013
- A separate, stricter code for public sector companies, covering board independence from the government owner, fit-and-proper criteria and performance evaluation. Relevant to clients transacting with, or sitting on the boards of, state-owned enterprises.
- State Bank of Pakistan corporate governance framework for banks
- Banks and certain regulated financial institutions answer to the SBP's corporate governance regime in addition to the Companies Act, including fit-and-proper tests for sponsors and directors [INSTRUMENT REFERENCE — TO BE VERIFIED BY REVIEWING LAWYER]. Where a client is SBP-regulated, that framework leads.
- Non-Banking Finance Companies rules and regulations
- Asset management companies, private funds and other NBFCs are governed by the NBFC rules and regulations made under the Companies legislation, which carry their own board, fit-and-proper and conflicts requirements administered by the SECP. Fund clients get a governance build that satisfies both regimes.
Statutory references are stated as of the page’s as-of date and flagged where verification is pending; the law moves, and the current position should be confirmed before relying on it.
Common Mistakes
The errors we see most — and their price.
- Treating board resolutions as paperwork to be signed in batches at year end, which leaves every intervening decision unauthorised.
- Letting the company transact with its directors and their businesses without the approvals the related-party regime requires, then meeting the issue for the first time in due diligence.
- Appointing family or friends as independent directors who fail the statutory independence tests.
- Missing the AGM and annual filing deadlines under the Companies Act 2017 until the registrar's notices arrive with penalties attached — and with directors personally named.
- Giving an investor reserved matters in the shareholders' agreement but never amending the articles, leaving the protection unenforceable against third parties.
- Keeping no minutes, or minutes so thin they prove nothing, so that when a decision is challenged the company cannot show it was ever properly made.
- Ignoring beneficial-ownership and ultimate-ownership disclosure requirements as the group structure grows.
- Assuming governance is a listed-company subject, when the Companies Act 2017 imposes duties and penalties on the directors of every private company.
Representative Scenarios
The shape of the work.
Illustrative scenarios, not case reports — composites drawn to show how matters of this kind run.
- —A founder-led company heading into a Series B engaged us after due diligence flagged two years of missing board approvals; we regularised the record, ratified what could be ratified, and the round closed with a disclosure letter rather than a broken deal. Illustrative.Illustrative
- —A family manufacturing group asked us to formalise dealings between the company and family-owned suppliers; we built a related-party policy and approval process, and the following year's audit passed without qualification on that point. Illustrative.Illustrative
- —An asset management company retained us to align its board and committees with both the NBFC regime and its own group standards after an SECP inspection letter. Illustrative.Illustrative
- —A deadlocked two-founder board asked us to mediate a director exit; the departure was papered, filings updated, and the dispute never reached court. Illustrative.Illustrative
Questions, Answered
What clients ask about corporate governance.
The Companies Act 2017 does not exempt you — directors' duties, meetings, registers, filings and related-party rules apply to private companies, with penalties for default. The practical need is even simpler: every investor, lender and acquirer will read your corporate record, and a thin or broken record costs money at exactly the moment you are trying to raise it.
The Companies Act 2017 imposes duties on directors and attaches penalties to a long list of defaults — defective filings, unauthorised related-party dealings, improper distributions among them — and officers can be personally named in SECP proceedings. Criminal exposure exists for the more serious defaults. The honest summary is that a directorship in Pakistan is not ornamental, and we brief incoming directors on exactly this.
Broadly, a dealing between the company and its directors, officers, major shareholders or associated companies — a founder's consultancy fee, rent paid to a family property, sales to a sister concern. The Companies Act 2017 and the 2018 regulations require board approval on an arm's-length basis with records to match. Everyone asks because it is where value most quietly leaks out of a company.
The Listed Companies (Code of Corporate Governance) Regulations 2019 bind listed companies; public sector companies have their own 2013 Rules; SBP-regulated and NBFC clients have sectoral regimes. A private company outside those categories is bound by the Companies Act 2017 itself rather than a code, but adopting code discipline early is the cheapest way to prepare for the day one of those regimes applies to you.
It is repairable, and repair is routine work for us — but the cost grows with time, penalties accrue, and some defects cannot be cured retroactively, only disclosed and managed. The dangerous version is discovering the backlog during a transaction, when the other side sets the timetable. As of mid-2026 the SECP's processes for regularisation are workable; we would rather use them before you are under deadline.
No, and we will not paper a record that pretends a meeting happened when it did not. The Companies Act 2017 provides lawful routes — ratification, written resolutions where available, and honest minuting of past decisions as of today's date. A repaired record that tells the truth survives scrutiny; a fabricated one converts a compliance problem into a fraud problem.
A register and filing history that matches the cap table, board and shareholder approvals for every significant past action, clean related-party dealings, and articles that will accommodate the new investment terms. Gaps are normal; unexplained gaps are the problem. Our governance review is deliberately built to the same checklist, so you read the report before the investor writes theirs.
The Companies Act 2017 requires certain companies to appoint a company secretary meeting prescribed qualifications, and even where not mandatory the function needs an owner. We train in-house secretaries and support them under retainer; whether the firm itself may hold the appointment for a given client depends on the company's category and independence considerations, which we confirm case by case.
A review of a single company is typically measured in weeks; repair depends on how deep the backlog runs; design and calendar installation follow quickly once the facts are settled. Multi-entity groups take longer because each entity carries its own record. We scope the phases separately in the engagement letter so you can stop after any of them.
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Prepared by The First Counsel · As of 2026-07-12 · Pending professional review — statements flagged in the text are being verified
This publication is provided for general information only. It is not legal advice, and neither reading it nor corresponding with the firm about it creates a lawyer–client relationship. The position stated must be verified against current law before it is relied upon.