State Trading Organization (STO) is seeking to amend their bylaws to add in the role and responsibility of Chief Executive Officer to that of the position of Managing Director.
Shareholders of one of the largest public limited company in the county, debated on this motion in the shareholders meeting held in Hotel Jen. The meeting was closed off to media.
In the meeting, STO revealed that the position of CEO is to be added to match corporate governance code issued by Capital Market Development Authority (CMDA). The amendments will seek to add in appointing CEO, responsibilities and removal from position.
Presently, STO does not have a CEO, while the MD head the company. If the motion passes then the MD will serve in dual roles of ‘MD and CEO’, as stylized.
Proposed amendments state that the Director appointed as Managing Director must be appointed as CEO. In the event, the said candidate loses the position of Managing Director, then the candidate also loses the position of CEO.
The position of CEO mirrors the responsibilities of the Managing Director and does not offer additional pay or perks.
Additional changes to the bylaws were proposed as well, including setting the quorum for board meetings at four Executive Directors. STO added that this amendment was proposed to limit control vested with a single individual and to negate difficulties in holding meetings.
As of now, the quorum is met when majority is achieved from one Executive Director, a Director appointed by general shareholders and rest of Board Directors. In the event required quorum is not met, then the meeting must be postponed by seven days. If the company fails to meet quorum in the next session, then the meeting can by held with the permission of the Registrar of Companies. STO had proposed to nullify this aspect.
The proposed changes can be implemented once the company holds an Annual General Meeting and ratifies these amendments.