Page 69 - CMA Journal (Jul-Aug 2026)

Article Section
A r t ic le S ec t ion

Transparency in Pakistan’s State Strong governance, transparency and accountability action, whereas timely reporting can strengthen At the same time, inadequate disclosure can management and stakeholder engagement as key
principles of e ective SOE governance. Countries such
are therefore essential to improve SOE performance,
undermine stakeholder con dence and public trust.
oversight and stakeholder con dence (World Bank,
Owned Enterprises: Strengthening Financial strengthen investor con dence and support scal 2023). The table below highlights how key Strengthening transparency, independent oversight, as Singapore, Sweden and New Zealand have adopted
a ect
can
de ciencies
internal controls and performance monitoring is
sustainability and long-term economic growth.
nancial
approaches that balance commercial objectives with
transparency
Governance for Sustainable Performance Transparency and Financial Governance performance and public trust. Consequently, therefore essential to improve nancial sustainability, public accountability, supported by strong
performance monitoring, independent boards and
accountability and public con dence in Pakistan’s SOE
improving transparency is critical to strengthening
Financial governance and transparency are essential SOE governance, reducing scal risks and ensuring the sector. e ective disclosure practices.
for e ective public-sector management, e cient use of public resources. Common features of these models include robust risk
Introduction Understanding accountability and the responsible use of public Recent SOE Reforms in Pakistan management, transparent performance evaluation,
In Pakistan’s public sector, State-Owned Enterprises State-Owned resources. Financial governance provides the Transparency Challenges in Pakistani The Government of Pakistan has introduced reforms to independent oversight and comprehensive disclosure.
(SOEs) play a crucial strategic role in sectors such as Enterprises in structures, rules and procedures through which SOEs SOEs and Their Impact strengthen governance, transparency and Increasingly, digital tools such as real-time
energy, transportation, aviation, infrastructure, Pakistan are directed, monitored and held accountable for their Many State-Owned Enterprises (SOEs) in Pakistan accountability in SOEs. A key development is the performance monitoring and online reporting
banking and telecommunications. These organizations performance and resource management. continue to face governance and transparency State-Owned Enterprises (Governance and platforms are also being used to enhance
are instrumental in promoting national development State - Owned Enterprises Transparency complements these mechanisms by challenges, including delayed nancial reporting, Operations) Act, 2023, which provides a framework for transparency. Adapting these practices to Pakistan’s
goals, fostering economic growth and delivering (SOEs) are government ensuring that relevant and reliable information is weak institutional frameworks, political in uence and improving disclosure, board e ectiveness, institutional context could strengthen SOE
essential public services. Unlike private-sector -owned or controlled available to stakeholders, enabling them to assess inadequate monitoring mechanisms. Delays in accountability and performance management. The Act governance, improve stakeholder con dence and Through data-driven decision-making, nancial Re
businesses, SOEs are responsible for managing public entities that operate in organizational performance, governance practices and publishing audited nancial statements and also promotes merit-based board appointments and support sustainable performance. discipline and performance-oriented management,
resources while balancing socioeconomic obligations strategic sectors such as the use of public funds. Greater transparency can performance reports limit e ective oversight and stronger strategic monitoring and performance they can serve as change agents and contribu
with commercial viability. Consequently, their energy, banking, reduce information asymmetry, strengthen informed decision-making, while weak internal evaluation. Role of Management Accountants in more accountable, transparent and e cient SOEs
governance and performance have a direct impact on infr astruc tur e , Imtiaz Bashir, FCMA accountability, improve decision-making and enhance controls and risk management increase exposure to The Ministry of Finance has further strengthened SOE Enhancing SOE Transparency Pakistan. in
public service delivery, economic sustainability and transportation and Senior Instructor of Commerce, public trust (IFAC, 2023). reporting through annual and biannual reports es
citizen trust. Transparency has therefore emerged as a telecommunications. In Govt. Graduate College of Commerce, covering scal risks, operational e ciency and Management accountants play an important role in Recommendations cr
Multan
Pakistan, SOEs manage
key component of e ective public-sector governance. signi cant public assets nancial performance. These measures aim to improve strengthening nancial governance and transparency A number of management and policy initiatives shoul
The timely, accurate and comprehensive disclosure of and play an important role in delivering essential public access to information, support evidence-based in SOEs. Beyond budgeting and cost control, they be considered to improve nancial governance and
information enables stakeholders to assess services, supporting economic activity and advancing policymaking and strengthen institutional support performance management through strategic transparency within Pakistan’s SOEs. First, dis
organizational performance, governance practices and national development objectives. Government accountability and scal management. However, budgeting, balanced scorecards, variance analysis and requirements should be strengthened to ensure that
the management of public resources. The Organization ownership is particularly important in sectors e ective implementation, continuous oversight and key performance indicators (KPIs). They also audited nancial statements and performance reports
for Economic Co-operation and Development (OECD, involving strategic interests, essential services and stronger institutional capacity remain essential for strengthen risk management and internal controls by are published on time. Second, governance su
2024) highlights that greater transparency can reduce natural monopolies (World Bank, 2023). these reforms to deliver sustainable improvements in identifying risks, evaluating controls and supporting frameworks should prioritize board independence and
information asymmetry between management and SOE governance and performance. compliance, thereby improving the reliability of professional competence through transparent,
stakeholders, foster accountability, increase public However, public ownership also presents governance nancial and operational information. merit-based recruitment procedures. Third, SOEs
trust and enhance decision-making. Similarly, the challenges, including political interference, International Best Practices Management accountants further contribute to should strengthen enterprise risk management a
operational ine ciencies, nancial losses and weak
World Bank (2023) emphasizes that transparent accountability. These issues have often resulted in International experience shows that strong integrated reporting by linking nancial and internal control mechanisms to enhance
institutions are better positioned to manage risks, government nancial support, placing additional governance and transparency frameworks can non- nancial performance measures, enabling accountability and protect public resources. •

improve productivity and generate long-term value. pressure on public resources. Strong governance improve SOE performance. The OECD emphasizes stakeholders to better assess organizational Digital reporting platforms should also be develope

The importance of transparency has become even structures, transparent reporting and e ective transparency, accountability, board independence, risk performance and sustainability. to facilitate stakeholder engagement and public
more pronounced due to the persistent challenges performance management are therefore essential to access to information. Performance-based
confronting several SOEs in Pakistan, including improve the e ciency, accountability and accountability systems should be established to •
operational ine ciencies, nancial losses, governance sustainability of Pakistan’s SOE sector (Ministry of ensure that boards and management are assessed

weaknesses and growing scal obligations. These Finance, 2024). against well-de ned objectives and measurable •
challenges have increased calls for reforms aimed at Economic Signi cance of SOEs in results. Finally, management accountants should be
strengthening accountability, improving disclosure empowered to take on strategic roles in organizatio
practices and enhancing monitoring mechanisms (IMF, Pakistan decision-making, performance management and •

2023). In response, the Government of Pakistan has SOEs have a signi cant impact on Pakistan’s economy For SOEs, transparency extends beyond conventional operational ine ciencies, nancial irregularities and governance.
introduced various governance reforms, including the through their contribution to employment, nancial reporting to include board composition, governance failures (Ministry of Finance, 2024; IFAC, •

State-Owned Enterprises (Governance and infrastructure development, energy security, executive responsibilities, strategic objectives, risk 2023). Political in uence in board appointments and The Way Forward and Conclusion •
Operations) Act, 2023, which seeks to strengthen transportation and public service delivery. Federal management practices, operational performance and strategic decisions can further weaken accountability Transparency is essential to e ective public-se
governance standards and performance monitoring SOEs manage assets and liabilities worth trillions of sustainability activities. The OECD Guidelines on and performance monitoring (OECD, 2024). governance and serves as a key driver of
across federal SOEs. Against this backdrop, this article rupees and play an important role in advancing Corporate Governance of State-Owned Enterprises accountability, e ciency and sustainable value
examines the signi cance of transparency in Pakistan’s national development objectives. However, poorly emphasize timely, reliable and comprehensive These weaknesses also create signi cant nancial and creation in Pakistan’s SOEs. The analysis highlight
SOEs, highlights key governance challenges, reviews managed SOEs can generate substantial scal disclosure to support e ective oversight (OECD, 2024). scal risks. Poorly managed SOEs may incur continued weak transparency can worsen nancial performance,
recent reform initiatives and international best pressures through nancial losses, growing debt and This is particularly important for Pakistan’s SOEs, which losses, higher operating costs and greater reliance on increase scal risks and undermine public con dence
practices, and discusses the strategic role of reliance on government guarantees and subsidies, manage signi cant public assets and resources. Weak government guarantees, subsidies and capital while strong governance, timely disclosure and
management accountants in strengthening nancial diverting public resources from essential sectors disclosure can conceal ine ciencies, increase injections, placing additional pressure on public e ective monitoring can improve organizational
governance, transparency and accountability. (Ministry of Finance, 2024; IMF, 2023). governance and nancial risks, and delay corrective resources (IMF, 2023). performance and stakeholder trust.

ICMA’s Chartered Management Accountant, Jul-Aug 2026 67