Islamabad - Securities and Exchange Commission of Pakistan (SECP) Chairman Zafar Hijazi has expressed his confidence in the stock markets’ soundness and said that the risk management system at the exchanges remains robust.

Hijazi said this in his keynote address at the Institute of Chartered Accountants of Pakistan’s CFO conference “Sustaining Excellence: Shifting Gears” held here on Thursday. Tahir Mahmood read out the SECP’s Commissioner for Company Law Division the speech.

Commenting on stock market situations, Hijazi said that capital markets of Pakistan witnessed phenomenal growth and reached historic heights in terms of index levels as well as market capitalization in 2014. The market capitalization peaked at $77.68b on February 3, 2015. However decline has been witnessed in March.

The regulator is vigilantly monitoring the stock market to ensure there is no systemic risk to it. He said that the rise in KSE-100 during the period was unprecedented, and hence we at the SECP were expecting some technical corrections. This was due, owing to various factors but predominantly because of continuous decline in oil prices internationally, selling by foreign investor’s due to upcoming US Fed policy announcement, upcoming gas tariff hike etc, he was giving logic behind recent fluctuations in KSE.

While appreciating the ICAP’s initiative of organizing CFO conference, Hijazi said that such events not only provide an excellent forum for discussions but also help us to re-align our goals and objectives.

Emphasizing the importance of CFOs responsibilities, Chairman Hijazi said the CFOs are the custodians of reputation of the financial integrity of an organization - and this puts enormous responsibility on their shoulders.

 He said that the regulator cannot work in isolation for the development of our financial market, thus it has great expectations from the corporate community, the CFOs and the auditors to achieve its objectives.

It is encouraging to note that our capital market players have started looking beyond their home ground for financial resources, he added. In developing scenarios, maintaining a robust capital market and corporate sector therefore has becomes a greater challenge for the regulator, as it seeks accurate information to be presented by companies to stakeholders, he added.  He said that it is the responsibility of the management and boards of companies to adopt sound corporate governance practices for adequate protection of shareholders’ rights, improving company performance and attracting long term investment both local and foreign. In today’s interconnected world, we are all global citizens and there is no such thing as a local market. Hence, it is very important for our companies to remain competitive.