Till the conclusion of demutualization
, SECP was empowered to appoint independent directors to the PSX board.
Law and the Articles of Association clearly provide that the Board of PSX should be reconstituted after completion of demutualization
Because shares can be traded or sold in contrast to ownership rights, which can -not demutualization
increases the possibility of profit for those involved, and tends also to benefit the economy.Pros and Cons of Demutualization
:1) Flexible Governance:Demutualization results are more flexible governance structure fostering decisive action in response to changes in the business environment.
counterparts, went through a phase of demutualization
in the late 1990s and early 2000s, the legislature didn't develop regulations for property/casualty demutualization
Under the aforesaid Demutualization
Act, members have ceased to be Members of PSX and they have been issued Trading Right Entitlement Certificates (TRECs) and PSX's ownership shares.
Subsequent to demutualization
of stock exchange, ownership has been separated through issuance of shares.
The Stock Exchanges (Corporatization, Demutualization
and Integration) (Amendment) Act, 2015, aims at extending the moratorium period provided in chapter III of the Stock Exchanges (Corporatization, Demutualization
and Integration) Act, 2012, as due date had already elapsed due to delay in promulgations the Act.
, the Dorrances received stock from the companies with an aggregate fair market value of $1,794,771.
Yet, such efficiency gains are questionable in many cases in regard to demutualization
He added : 'Demutualization
is a statement of our commitment to transparency and good corporate governance.
The Nairobi bourse is currently owned by 22 investors but the stock market changed to the Nairobi Securities Exchange after undergoing a demutualization
The Insurance Department counsel, who has devoted many years to the demutualization
issue, acknowledged that there is still a lot to learn about the procedure.