The Securities and Exchange Commission of Pakistan (SECP) has issued a circular introducing enhanced disclosure requirements for Fund Manager Reports (FMRs) by Asset Management Companies (AMCs).
These measures are aimed at promoting transparency and enabling investors and unitholders of Collective Investment Schemes (CIS) to make more informed decisions,said a press release issued here on Friday.
Key enhancements include disclosure of Actual Expenses as a percentage of net assets, applicable sales loads, monthly Portfolio Turnover Ratios, risk adjusted return, Yield to Maturity, Modified Duration, Macaulay Duration, Beta and Standard Deviation.
Further, FMR must also disclose comparative analysis of benchmark and committed returns. In addition, index descriptions and tracking difference history for ETF are also mandated.
To ensure consistency and accuracy in disclosures, the Mutual Funds Association of Pakistan (MUFAP) has been tasked with developing a standardized methodology for calculating the prescribed quantitative measures.
The enhanced disclosures will become effective immediately upon SECP’s approval of the MUFAP methodology. This initiative reflects SECP’s continued commitment to improving market integrity, transparency, and investor protection in the asset management industry. The Securities and Exchange Commission of Pakistan (SECP) has introduced new requirements for Asset Management Companies (AMCs) to issue Key Fact Statements (KFS) to enhance transparency and investor awareness, enabling informed decision-making.
The KFS is designed to provide investors with clear and concise information, empowering them to make well-informed investment choices, according to the press release issued today.
Under the new requirements, AMCs must ensure that each Collective Investment Scheme (CIS) and Investment Plan has a separate KFS, which must be readily accessible on the AMC’s website, digital platforms, and the websites of digital distributors.
The KFS includes details on the investment objective, authorized investment avenues, minimum investment amount, fund duration, and performance benchmarks. It also covers subscription and redemption terms, applicable charges, and a reference to the total expense ratio (TER) in the fund manager report. Additionally, the KFS will outline the details of key stakeholders, including the Asset Management Company, Trustee, and Shariah Advisor (if applicable), along with their contact information.
This structured disclosure will help investors better understand fund attributes, associated risks, and expected returns, thereby promoting transparency and informed decision-making. These requirements will take effect from April 30, 2025, for new CIS/Investment plans that have not yet been launched. Existing perpetual CIS/Investment Plans must comply by June 30, 2025. AMCs are also required to submit supplemental constitutive documents to the SECP within one week of any amendments.
The SECP remains committed to strengthening investor protection and fostering transparency in the mutual fund industry through these enhanced disclosure measures.
The Securities and Exchange Commission of Pakistan (SECP) has made amendments to the Listed Companies (Code of Corporate Governance) Regulations, 2019 and the Companies (Postal Ballot) Regulations, 2018. The amendments have been made pursuant to SECP’s commitment to safeguarding shareholders’ rights, enhancing corporate governance practices, and upholding market integrity,said a press release issued here on Friday.
Under these reforms, the category-wise voting scheme has been omitted to support minority shareholders’ representation on the board. Further, the scrutinizer’s role has been enhanced for bringing transparency in the process of accepting or rejecting nominations for election of directors and proxies. Reforms were also incorporated to enhance corporate governance by including provisions for mandatory attendance of directors in the general meetings and encouraging independent evaluation of board performance by an external body.
Earlier, the SECP constituted a committee comprising market experts and relevant stakeholders to enhance transparency and improve the manner of holding the shareholders’ meetings. SECP carried out extensive public consultation on the committee’s report, following which the reforms were proposed in light of the committee’s recommendations. Public consultation was also carried out on the proposed reforms. The amendments in the Listed Companies (Code of Corporate Governance) Regulations, 2019 and the Companies (Postal Ballot) Regulations, 2018 are posted on the SECP website.