Need stressed to develop & implement good governance practices

Karachi: Yaseen Anwar, Governor, State Bank of Pakistan has stressed upon the need to develop and implement good governance practices in order to provide impetus to economic growth.

‘Emphasis on good corporate governance regimes cannot be underscored more as it creates an attractive investment climate necessary to maintain investors’ confidence, resulting in positive impact on the share price and creating possibilities for raising low cost Capital,’ he said while speaking as a Chief Guest at ‘The Success of Executive MBA of 2012’ held at IBA Main Campus in Karachi Tuesday.

The complexities arising in the ecosystem of any business may arise in the shape of macro economic imbalances that include sagging demand, inflation, volatility in financial markets, etc., he said, adding that while demanding situations on the internal front arise from personnel management, investment ambiguity that there are always complex matrices linking external challenges with internal ones and therefore, successful business leaders will never make internal business decisions in isolation. ‘An uniformed business leader is a leader without a vision and quite likely without any success,’ he said.

SBP Governor said the present turmoil in the financial sector provides an opportunity to learn from the financial world’s mistakes and overzealousness. ‘I feel the most significant lesson that we have learnt from recent events is the importance of fundamentals in risk management. ‘For instance, there is a basic rule since inception of banks which says ‘do not put all your eggs in one basket’. Had this simple rule been followed, many institutions could have avoided huge losses,’ he added.

He asked the MBA Executives to focus on establishing a system that actively promotes ethical decision making – one that can act as a deterrent to unethical, illegal and harmful practices within the institution.

‘Remember, as future executives, you will have a fiduciary duty towards shareholders, employees, clients and society as a whole. More often than not, their interests will not be aligned and you will need to make extremely tough choices,’ he added.

Mr. Anwar told the MBA Executives that they are the leaders of tomorrow and added: ‘I’d like to present another challenge as you step into the world of business. I challenge you to change the way business is done here. I challenge you to create an organization that can survive, and indeed thrive in the challenging business environment we face today. I challenge you to create the organization that will become the face of Pakistan abroad. And I challenge you to do all this while remaining true to your own values, your own personal ethos, and while remaining servants to the people of this nation so that you may be able to take better, well-informed and principled decisions.’

Dr. Ishrat Husain, Director and Dean of IBA also spoke on the occasion.

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