Role and responsibilities of board

Roles Responsibilities and Functions of board of directors:

  1. The major responsibility of the BOD is to save the shareholders' capital, and got maximum output on their investments.
  2. BOD keep check over the activities of the company. They are guided by shareholders and reported to them
  3. They play a vital role in a sustainable growth of a company and shareholders expect transparency, loyalty, reliability faithful reporting and deep care from them.
  4. Directors of a public company should meet twice in a year to check the affairs of the company and look after the financial records.
  5. Due to competition increases nowadays it is needed to evaluate and check the companies affairs daily by board of directors.
  6. BOD are responsible for CEO succession planning, because evaluating and selecting the CEO is the major function of governance.
  7. BOD should have a clear understanding of leadership talent.
  8. BOD should review the internal audit reports, so that frauds and fishy dealings are immediately catches. As in case of Bank of Punjab scandal, due to irresponsible and irregular behavior of their directors the bear great loss...
  9. BOD should have thorough details of partnership or joint venture dealings.
  10. Irregularities regarding to labor union and employees related issues should be undertaken on regular basis
  11. Fair and transparent distribution of charities funds donations and utilizes fairly.
  12. BOD should disclose even any minor issue, which effects the financial position of the company, and effects its reputation.
  13. The responsibilities and role of board of directors in a company are deeply explained in SECP code of corporate governance and Companies ordinance act 1984.

If BOD fairly fulfill their duties and play their roles with honesty and loyalty, then there is less chance of companies corruption, and company keeps itself safe from such scandals which is faced by Bank of Punjab.

Bank of Punjab corruption scandal.......It is not only one scandal, but by the grace of Allah our history is filled with thousand of such scandals. Shakespeare once say ,

"Everything seems to be rotten in the state of Denmark or something like that...?"

May be everything used to be rotten in Denmark but atleast the above statement is not true today. Today everything is seems to be rotten in the Islamic State of Pakistan.

Bank of Punjab a huge fraud that involves billions of Rs. Huge amounts/ loans including, owners of some of the companies that do not exist that at all. And board of directors of (bop) bank of Punjab also involved in it. And other issue i.e. fake identity cards were used there. & over-evaluated properties were also pledged as collateral.

From Bank Side who were involved...?

  • MD of bank Haroon Aziz is also involved in this case. On 25th May 2008,GM audit submitted a report to bank president in which it is clearly warned the bank. That not to give money to some doubted companies. i.e Haris steel mill ,Tufail road branch etc. Many influential people involved in this case. MD of the bank give no response to the issue of GM complain. So irregularities become a routine in the bank. So bank's internal environment itself is root cause of the problem. All members are not loyal towards their responsibilities. And no proper check and balance over the Credit Management department. And also some powerful personalities influenced and weakens down the roots of the bank.
  • Himesh Khan the CEO president of BOP, involved within billions of rupees of fraud's case. He was arrested in U.S.BOP granted a loan for RS. 9 billion to Haris Steel industries (HIS), without fulfilling the legal requirements, so HIS become defaulter of loan. Himesh Khan CEO, was involved in RS:9 billion fraud...Well, this story shows that BOARD OF DIRECTORS of BOP were doing illegal work, and involved in taking commission from different sources. And for a long period of time, MD of the bank give no response to GM complains and reminders...This cause a major problem and bank of Punjab goes to bankrupt. Later on NAB arrested the main culprits of BOP FRAUD case, Sheikh Mohammad Afzal and also his son Haaris Afzal of Haaris Steel Mills from Malaysia. They are involved with the CEO of the Bank Of Punjab.

From Opposite side.... Others companies who availed irregular loan:

Negligence on credit processing levels:

        The facilities availed by Haris Steel and its allied account the irregularities highlighted in audit report. Inefficient credit processing causes number of problems. such as

  1. Bills were discounted under the other bank L/Cs, with out seeking (financial institutional risk management units) FIRMU allocation, bills were discounted against 3rd party (Allied groups accounts) acceptances etc.
  2. The ID cards used against borrowing account with running finance facility were fake. NADRA also confirmed that. There found two ID cards having same name, same father name, same signature but different photographs. At Tufail branch Lahore.
  3. Over due liabilities on HARIS and HAIDER steel mills.

Oh God..., This shows extreme ignorance towards the irresponsible attitude of board of directors, and lack of transparency and disclosure. Who is accountable? There is a need of proper check and balance even to a minor statement and issue.

Serious Violation of state bank rules:

        In above mentioned companies Inland traders were previously dealing with the Saudi Pak but no confidential report as per requirement. State bank of Pakistan prudential regulations that restrict a bank from giving facilities to the certain limit, according to record a person opened sixteen companies accounts in Davis road & Tufail road branches & set credit line worth billion of Rs.

Analysis of bank record shows,...fishy dealings:

        On the basis of analysis audit report says atleast 7 persons had been running two proprietorship concerns, against which they are availing crediting facilities. The outstanding liabilities against these persons stands 5.43 billion.

The bank was already also involved in another scandal of "Crescent bank investment bank ltd.". So there are number of issues behind the blunder.

  1. In Daily News, a bank of Punjab clarifies report also issued by title" Fishy dealing "published on June 21,2007.In which different statements by GM hanif and Haris steel industry was given against the dispute.....but it might not be true.
  2. Another industrial Seth Yaqoob & his daughter Irum Yaqoob had also been detained & their assets were frozen, they are also involved .Many big personalities and famous industrialist and businessmen are involved in the bankruptcy. This all made possible due to lack of tight corporate policies in the bank.
  3. Many other famous political personalities including Aetzaz Ahsaan, Babar Awan, Moonis Elaahi, Ch. Shujaat, Ch. Parvaiz Elaahi, Latif Khosa, Malik Qayyum, Sharifud-din Pirzada, Waseem Sajaad, Salman Siddique. 15TH December 2009 in capital talk, talking with Hamid Meer, Aetzaz Ahsan defends himself by arguing the Suleman taseer's arguments. And claim that all misunderstandings are not true and justified.

Famous political personalities who are considered involved in bank of Punjab scandal. In daily news there are certain claims along with their pictures. These included including Aetzaaz Ahsan, Babar Awan, Moonis Elahi, Ch. Shujaat, Ch. Parvaiz Elaahi, Latif Khosa, Malik Qayyum, Sharifud-din Pirzada, Waseem Sajaad, Salman Siddique.


  4. International The NEWS, Sunday, August 03, 2008 By Muhammad Ahmad Noorani Islamabad
  5. Capital talk by Hamid Meer, program on 15th December 2009

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