Table of Contents

Current Situation ................................................................................................................ 2

A. Current Performance: ....................................................................................................... 2
B. Strategic Posture: ................................................................................................................ 2
Corporate Governance ...................................................................................................... 3
A. Board of Directors: ............................................................................................................. 3
B. Top Management .................................................................................................................... 4
External Environment – Opportunities & Threat .................................................... 4
A. Natural Physical Environment: sustainability issues ............................................ 4
B. Societal Environment ........................................................................................................ 5
C. Task Environment ............................................................................................................... 6
D. Summary of External Factors ......................................................................................... 7
Internal Environment ....................................................................................................... 8
A. Corporate structure .............................................................................................................. 8
C. Corporate Resources ................................................................................................. 10
6. Strategic Alternatives & Recommended Strategy........................................... 16
New Strategy Alternatives ......................................................................................................16
A. Recommended Strategy ..................................................................................................17
7. Implementation .......................................................................................................... 17
8. Evaluation & Control .................................................................................................. 20
Current Situation

A. Current Performance:

The company was founded back in 1936 with the commodity trading company
and in seven decades transformed in to manufacturing companies and grew itself
as a conglomerate diversified in more than one industry. As of now Fatima group
is the first company of Pakistan to cross $1 billion in annual revenues. The
company has strong footing in the sugar and fertilizer business in Pakistan. The
company has recently entered into venture capitalist as well where they fund the
startups and usually target those startups, which would in future help them.

B. Strategic Posture:

Vision:
To be a dynamic business group, building robust businesses that excel at serving
their customers and stakeholders through exceptional products and services in
industries and markets that support progression and economic growth at
community, society and country level.

Mission:
To create continuous value for our customers and consumers, inspiring
confidence and respect through the highest levels of product quality and service.

To provide employees a work environment that's enabling and inclusive and

where innovation and entrepreneurship are a way of life and where people work
in an ethical and safe business, based on the principals’ merit and equal
opportunity.

To be a responsible corporate citizen, complying with all aspects of Corporate

Governance and the full spectrum of Corporate Social Responsibility.

Values and behaviors:

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 They company has set defined behaviors for integrity, behaviors for innovation,
behaviors for teamwork, behaviors for safety, health, environment & CSR,
behaviors for customer focus, behaviors for excellence, valuing people. Company
very keenly focuses on the behaviors that it expects from its employees and so for
that purpose they have defined objectives.

Strategies and Policies:

Company follows the strategy of unrelated diversification in order to reduce risk

of failure. Fatima group has a division with the name of Mukhtar A. Shaikh
hospital, which is located in Multan and is the equipped with the state of art
machinery and operation room and is highly subsidized for the people who cannot
afford. So the group has a mindset of giving back to society.

Corporate Governance

A. Board of Directors:

Fatima group has numerous board of directors, as it is a conglomerate dealing in

fertilizers, textiles, sugar mills and newly formed venture capitalist firm.
Mr. Arif Habib is the Chairman of Fatima Fertilizer Company Limited. He is also
the Chief Executive Officer of Arif Habib Corporation Limited, director of
Pakarab Energy Limited and Chairman of Pakarab Fertilizers Limited, Fatimafert
Limited, Aisha Steel Mills Limited and Javedan Corporation Limited. Mr. Fawad
Ahmed Mukhtar is the Chief Executive Officer and Director of the Company.
Other directors include Fazal Ahmad Sheikh, Faisal Ahmad Mukhtar (executive
director). Faisal Ahmad Mukhtar, Muhammad Abad Khan, Muhammad Kashif
Habib, Anja E.Nielsen (independent director), Tariq Jamli (nominee director). The
company currently has 8 directors on it board of director list for the entire group
with Fawad Mukhtar servicing as director for every company. Fatima group is the
family owned company and some of the companies in the group are public limited
while other are private limited.

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B. Top Management
Mr. Arif Ur Rehman (Chief Manufacturing Officer) was appointed in July’ 2016,
and now he is responsible for Fatima fertilizers plant. Mr. Rehman Hanif (Plant
Manager) is heading the Fatima Fertilizer, Plant site, Sadiqabad, as Plant Manager
since January 01, 2018. Mr. Asad Murad (Director Finance & CFO) for the
company looks after the finances of the company and is responsible for all the
related affairs of the group. Mr. Ausaf Ali Qureshi (Company Secretary) joined
the Group in May 2010 as Company Secretary with additional responsibility for
investor relations. his 20 years’ plus career at BMS.
MS. Sadia Irfan (Director Human Resources) she is responsible hiring the
employees for the group, she also plans and organize different recruitment
processes for the company through different universities of Pakistan. Iftikhar
Mahmood Baig, (Director Business Development), Aftab Ahmed Khan (Chief
Supply Chain Officer), Khurram Javed Maqbool (Director Sales & Marketing
(FFCL)), Qadeer Ahmed Khan (Director Special Projects), Ahsen ud Din,
(Director Technology Division), Sardar Naufil Mahmud (Chief Information
Officer), Salman Ahmad (Head of Internal Audit), Faisal Jamal (Corporate HSE
Manager).

External Environment – Opportunities & Threat

A. Natural Physical Environment: sustainability issues

The major natural factor that effects the fertilizers sale is the rainfall, although the
demand for the fertilizer is around the year ranging from different varieties due to
different seasonal crops but if the rainfall is excessive then the sale for the
fertilizers decrease because the rain make the soil fertile and so less fertilizers are
needed for the growth of the crops.
Similarly for the textile the cotton is the main raw material and it is majorly
affected by either rainfall or droughts. The other businesses of the company are
risk free from any of the natural disasters.

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B. Societal Environment

Economic:
The current situation of the economy of Pakistan is booming. The past 5 years
had been good for the overall economy and the BPI of the country has increased
which has directly affected the sales of the fertilizers due to increase in demand
of kharif and rabi crops. Overall the textile sector is also getting better because
GSP status of Pakistan is resumed. The end consumers are the common people
for both textile products and the fertilizers; the increase in population has
increased the demand.

Technological:
Fatima group invest a substantial portion in technology, for this very purpose
they have started a venture capitalist firm that is responsible to fund the related
startups such as Mangobaaz, interacta and beauty hooked. The company’s main
aim is to beat its competitors in technology, which are Fauji fertilizer and also the
Cres-ventures. Fatima group has three facilities for the fertilizers manufacturing
and they are currently the most upto date facilities in the country in these sectors.
Political-legal:

Political stability and legal system of the country is very important and essential
for the businesses and economy to grow. Political stability and strong legal and
justice system gains the confidence and trust of international and local investors
both which help the economy to grow. Considering the political situation
prevailing in the country which is quiet stable as compared to the past as the
second successive democratic government is about to complete its tenure which
is for the first time in the history of Pakistan. So the political stability is further
helping the investment to come in Pakistan, providing jobs to people due to
which their BPI is increasing and thus the increase in demand for food related
products and this directly effect the conglomerates portfolio of energy, textile and
fertilizers.

Socio-cultural:

Considering the socio-cultural factors, which are also favoring the business of
Fatima group and respective industries. Population of Pakistan is growing rapidly

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 which is another opportunities for the businesses to grow. Fatima group currently
is focusing on hybrid strategy for their fertilizer business and for textile under
reliance weaving they focus on differentiation strategy, differentiation themselves
on the basis of quality and the product they currently exports.

C. Task Environment

Threat of New Entrants: Considering the overall situation for the past few years,
the local entrants in the market that could make an impact was close to zero in
case of fertilizers. In the venture capitalist there are numberous entrants such as
Cres-ventures, investtoinnovate, DotZero etc.
Bargaining power of Suppliers: Bargaining power of suppliers is low. Fatima
group is fully integrated they have their own energy plants for the fertilizers and
also the spinning units. The major raw material is gas and electricity for every
company of the group and they rely on their own energy reducing the power of
supplier from the SNGPL and WAPDA.
 Bargaining power of buyers: Bargaining power of buyers is comparatively high in
this industry. The reason is although there are very less domestic competitors but
international fertilizers are available in market such as FMC. The international
competitors are selling fertilizers at low prices so they need to adjust their prices
accordingly otherwise the buyer would shift to other companies. As Pakistan is
textile rich industry so there are numerous firms so the buyers have a lot of
options they could shift if the company is offering higher prices.
 Rivalry among competing firms: there is great competition for the textile sector,
some are competing on cost and other are competing on differentiation strategies.
Although the completion is not very high in case of the fertilizers as the demand is
increasing and the companies are working on their full capacities currently.

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D. Summary of External Factors

KET EXTERNAL FACTORS WEIGHT RATINGS WEIGHTED

SCORE

OPPORTUNITIES

International collaborations for business

0.08 1 0.08
development.

Potential to increase per acre consumption of

0.04 3 0.12
fertilizers.

Further strengthening of NP and CAN image

0.08 1 0.08
compared to other fertilizers.

Capacity enhancement through Revamp of

0.08 2 0.16
Ammonia and other Plants.

Government’s refocus on incentivizing farmers to

0.04 3 0.12
promote agriculture growth.

Taping foreign markets via exports

0.05 3 0.15

More innovations of the products

0.05 3 0.15

THREATS

Low prices offered by competitors 0.03 4 0.12

Increased competition by foreign 0.15 1 0.15

companies/globalization

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Climate changes and water scarcity impacting
0.06 1 0.06
agriculture.

Increase in production costs 0.08 4 0.32

High taxation 0.05 3 0.15

Dependence on single source and imbalanced 0.04 2 0.08

Logistics support

Volatile law and order situation.

0.06 1 0.06

Vulnerable to reactive attack by major 0.04 4 0.16

competitors

Total 1.00 1.97

Interpretation

Total weighted score of EFE matrix of Fatima Group (1.97), which shows that the
response to the external factors is just satisfactory.

Internal Environment

STRENGTH AND WEAKNESS (SWOT ANAYLSIS)

A. Corporate structure
The Board of Directors at Fatima fertilizers has a very active participation with
their involvement in company strategic management. The decision making is
centralized. Board of directors approve and make final decision on mission,
strategy, policies and objectives of the company. The major responsibilities of
Board of directors is setting corporate strategy, overall direction, and controlling,

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 monitoring and supervising top management. So, all the strategic decisions have
been made in Lahore Head office. Though decision-making is centralized but
Fatima fertilizers have the proper organization hierarchy and every employee
understand the structure and the level of delegation each employee has. All
employees of the organization are collectively working towards the achieving
organization objectives of providing the good quality to the consumer.
Fatima fertilizers continue to pursue a global reach by leveraging and maximizing
our fertilizer / business potential. The Company aims to establish strategic alliance
and partnerships with global technology providers to bring innovation and
excellence in their processes.
Their strategy revolves around the potential of our employees who are critical to
our long-term growth and success. Fatima fertilizer believes that the Company
provides the employees an opportunity to build the skills while enjoying their
work place. Critical to the strategy are also their technological resources and the
image of the brand.

B. Corporate culture
At Fatima fertilizer the culture is about working together to achieve organizational
goals. There is more democratic style of leadership which involve
communications with the employees to employers. The company care for the
environment and the communities while continuing to create shareholders’ value.
The employees are given training session and are encouraging to collectively
work in a team to bring in more ideas and innovation. The top management highly
ensure to take care of the employees right, respect and dignity at all levels they
develop a sense of ownership by involving employees. They provide an exciting
and enjoyable environment, ensuring work-life balance, creating opportunities for
growth and development and supporting gender diversity.
The company offers employee development opportunities through counseling and
formal training programs. All these facilities not only help in employee’s
development but also help in preparing the incumbents expected to occupy key
positions. The strategies are changing and evolving over time with this

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 consideration that it is align with the company’s objective and goals therefore they
ensure that employees are well trained so there remains consistency.
They aim to be the industry leader and a sustainable contributor to the nation’s
agricultural sector. Aspiring to continuously improve by achieving and exceeding
global standards for product safety, quality, EHS, manufacturing and management
excellence
Fertilizer Company Limited epitomizes and is reflected in all the transactions and
interactions. Congruence to these values has been a part of their business strategy.
They are bound in the very fabric of the organization, shaped by organizational
processes, procedures and practices.
Integrity
Our actions are driven by honesty, ethics, fairness and transparency.
Innovation
We encourage creativity and recognize new ideas. Teamwork We work
collectively towards a common goal.
Health, Safety, Environment & CSR
We care for our people and the communities around us.
Customer Focus
We believe in listening to our customers and delivering value in our products
and services.
Excellence
“We strive to excel in everything we do. Valuing People We value our people
as our greatest”

C. Corporate Resources
1. Marketing

Each year, the farmers of Pakistan witness a new season with its own unique
challenges and hurdles, some for which they are equipped to deal with, and
others for which they must find new solutions. In a similar fashion, the
Sarsabz Sales & Marketing team too, adapts to this ever-changing
environment and tries to foresee the future with the aid of strong research and
planning, to serve the varying needs of our farmers.

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PROBLEMS IN MARKETING
 Weak competition or shortages may lead to price gouging and/or
product adulteration.
 Rigid and slow reaction to market changes.
 New entrants discouraged.
 Uneducated target market because of this marketing is difficult.
 Prices are not same in all over Pakistan.
 Ineffective distribution process

2. Finance

Ratings are supported by diversified product mix of the company. In tandem

with management’s diversification strategy, sales mix has tilted towards NP
and CAN, underpinned by higher volumes during 2016. In 9M2017, topline
was further supported by notable growth in CAN and urea off take, although
NP volumes decreased slightly. However, uptick in overall fertilizer sales is
expected in 4Q2017 on account of which broad based growth in sales is
expected during 2017 as compared to 2016.
Despite some pressure on margins due to increased price competition in
nitrogenous fertilizers, FATIMA’s bottom line has improved on the back of
healthy volumetric growth. Effective tax rate was lower due to tax exemption
on subsidy from government. Availability of 110mmcfd1 feedstock gas supply
to FATIMA at concessionary rate of US$ 0.7/mmbtu (concessionary gas
available till 3Q2021) has enabled it to maintain better margins in relation to
most peers.
Going forward continued focus on enhancing sales is envisaged by
management. This, along with normalization of margins is expected to support
earnings over the coming years. Moreover, increase in international DAP
prices can result in higher profits from phosphate (NP) business.
Despite challenging industry outlook, the company has maintained a
conservative financial profile. Loans extended to associates represented 2.7%
of asset base at end-2016. Funds from Operations (FFO) have improved on
account of better profitability. In line with industry-wide trend, trade debts

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 have increased since 2015; these have been funded through short term
borrowings. With growth in total equity and decrease in total borrowings,
leverage indicators have declined on a timeline basis. Despite the challenging
sector dynamics, financial metrics including cash flows in relation to total debt
have largely remained within benchmark limits for the assigned ratings.
Impact on financial profile of FATIMA post-merger with Fatima fertilizer
with respect to cash flows will continue to be tracked by JCR-VIS.

3. R&D
For the year 2017, our team motto was “Together We CAN”. Fatima Fertilizer
outlined key weak areas for their product CAN, which remained mainly the
rice belt. Fatima Fertilizer worked with the Rice Research Institute, Kala Shah
Kaku and published ground breaking research on rice production technology.
With the Government’s authoritative recommendation for CAN on rice,
Fatima Fertilizer took the knowledge to every nook and corner of Punjab’s
rice belt. Mass public gatherings were held, where farmers who had
experienced greater than 10% yield on rice, and leading researchers, were
invited, to give their testimonials. The results of such activities can be clearly
seen by the highest ever sales achieved by our North zone for rice crop. At
Fatima Fertilizer, Marketing to be one of the key strengths and Fatima
Fertilizer continue to create innovative campaigns that strengthen the
backbone of Pakistan- its farmers.

4. Operations
In April 2016, FATIMA completed Phase-2 of the Ammonia de-bottlenecking
project aimed at improving production efficiencies. Resultantly, production
levels increased by around 30% (annualized) during 2017 and plant
turnaround time has improved considerably. FATIMA also undertook an
integrated marketing campaign to promote combined usage of NP and CAN
instead of conventional fertilizers while also continuing its farmer outreach
programs. The company continues its strong focus on educating farmers on
yield enhancement methods which will aid in improving their income.

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5. Human Resource Management
Hiring quality manpower, keeping them happy, satisfied and motivated are the
pillars of the Human Resources Department; justice, fair play and merit
oriented treatment are some of the ingredients of processing cases by the
Human Resources Department. For Human Resource development, another
aspect which receives its due share is training. The employees are exposed to
various kinds of cross training, technical courses management courses,
workshops and seminars both at home and abroad. Employees' welfare has all
along received due consideration by the Management.
6. Information Technology
Information Technology Division (ITD) continues to be a key component in
how we support Fatima and provides an extensive range of computing and
communication services, facilities and infrastructure for use by its employees.
The ITD is aligned to the business needs of the organization, ensuring that the
solutions delivered are relevant to the needs of the business. Our Vision 2022
involves strengthening decision making, using improved analytics and
dashboards capability and as a strategy will focus on mobile applications,
reduce paper footprint and increase its reach to farmers by deploying latest
technology and help grow business using Precision Agriculture.

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D. Summary of the internal factor

Key external factors Weights Rating Weighted

score
Strengths

Differentiated and diversified product portfolio, i.e. NP, 0.2 4 0.8

CAN and Urea

Manufacturer of cost efficient substitute of DAP. 0.1 3 0.3

Diversified pool of qualified and committed human resource. 0.07 2 0.14

Extensive and growing Dealers Network. 0.09 1 0.09

Largest Technical Support team and unique farmer and 0.1 4 0.4
customer services.

Weakness

No alternate to single source of natural gas supply. 0.2 4 0.8

Relatively New Brand competing against established brands. 0.09 3 0.27

Dependence on single source and imbalanced Logistics 0.07 3 0.21

support.

High competition such as fauji fertilizers 0.04 2 0.08

Centralized decision making 0.04 1 0.04

Total 1 3.94

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 The score indicates that the company has more strength over its weakness.
Fatima fertilizer though have major competition that is fauji fertilizer, yet they
have maintained their place in the market. Fatima fertilizer have a diversify
portfolio of products that has a good quality and has a strong dealer network.

Analysis of strategic factor (SWOT)

Strength
 Differentiated and diversified product portfolio, i.e. NP, CAN and Urea.
 Manufacturer of cost efficient substitute of DAP.
 Diversified pool of qualified and committed human resource.
 Extensive and growing Dealers Network.
 Technical Support team and unique farmer and customer services.
Weakness
 No alternate to single source of natural gas supply.
 Relatively New Brand competing against established brands.
 Dependence on single source and imbalanced Logistics support
 Centralized decision making
Opportunity
 Potential to increase per acre consumption of fertilizers.
 Further strengthening of NP and CAN image compared to other fertilizers.
 Capacity enhancement through Revamp of Ammonia and other Plants.
 Government’s refocus on incentivizing farmers to promote agriculture growth.
 International collaborations for business development.
 Taping foreign markets via exports
 More innovations of the products
Threats
 Climate changes and water scarcity impacting agriculture.
 Continuing energy crises.
 Volatile law and order situation.
 Weak economic situation of Farmers.
 High competition

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Strategic Alternatives & Recommended Strategy

Currently the group is focusing on differnet strategies for its different companies.
For fertilizer Fatima is focusing majorly on cost leadership strategy and they are
uptil now very successful in doing so. This is reflected in their financial
statements and their stock price is currently valued at 52 weeks high i.e 34.25.
which shows that company is doing good and the book value is around 25.59
which shows the company’s strategy is doing good. Number of units sold is also
great and so are the margins in the industry which has allowed the group to grow
into a conglomerate.
Positioning map
Fatima group has been in business for now more than seven decades. Its has
now been around 15 years that the Fatima fertilizer division has now a very
strong footing in the industry their main business from where they started to
grow. Although other businesses of the group are not very well know by
public and other investors. Reliance packing, weaving and commodities are
also the companies that are subsidies of Fatima but because they donot carry
the name Fatima along so they are not very well related with the group itself.
so now in the fertilizer industry they are positioned on the lines of high quality
and high prices, although the prices are similar to what the competition offers
that is fauji fert but the prices of the fatima are little higher than them.

A. New Strategy Alternatives

 The first thing Fatima can do is that they can start focusing more on related
diversification rather than unrelated diversification, which would help them focus
more on some specific products and fully utilize all their resources in one
direction.
 They could also go for business expansion strategy, meaning that they could
expand into international markets. Currently their products are avaliabe majorly in
Punjab through network of distributors but they could tap into the Sindh market.
 They can look for growth strategies such as integration. They are already doing
backward integration i.e they have established their own suppliers base such as the
chemicals and energy for fertilizers, they are now relying on biogas, LPG and coal
because of the gas shortages in winters.

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B. Recommended Strategy

Fatima group has always focused on diversification for their growth and majorly
unrelated diversification. They should now focus on related diversification and
add HYV’s and also the pesticides in their portfolio that would give then edge
over other fertilizer companies that are currently operating in Pakistan. They have
very strong established footing in the industry and is related with the name of
quality.

Implementation

Total Quality Management should be developed at Fatima Fertilizer to put into

practice the developed strategy. This approach will allow long-term success
through customer satisfaction. In a TQM effort, all stakeholders at Fatima
Fertilizer will take part in improving processes, products, services, and the
culture in which they work.
The steps suggested for the implementation of Total Quality Management first
and foremost will involve all employees for continual improvement. It will use
strategy, data, and effective communications to amalgamate the quality control
into the culture and activities of Fatima Fertilizer. Here are the 8 principles of
total quality management:

1. Customer-focused
The primary focus of Fatima Fertilizer will be on the customer. For this
purpose the company employees will undergo the training employees,
integrating quality into the design process, upgrading computers or software,
or buying new measuring tool- to satisfy the customer.

2. Total employee involvement

All employees will participate in working toward common goals. This will
happen when empowerment has occurred, and management has provided the
proper environment. High-performance work systems integrate continuous

17
 improvement efforts within business operations. Self-managed work teams
will be formed at Fatima Fertilizer as they are one form of empowerment.

3. Process-centered
A fundamental part of TQM is a focus on process philosophy. A process at
Fatima Fertilizer includes a series of steps that take inputs from suppliers and
transforms them into outputs that are delivered to customers. The steps
required to carry out the process will be defined, and performance measures
will continuously monitor in order to detect unexpected variation.

4. Integrated system
Although Fatima Fertilizer consists of many different functional specialties
often organized into vertically structured departments, it is the horizontal
processes integrating these functions that are the focal point of TQM.
Micro-processes add up to larger processes and all processes aggregate into
the business processes required for defining and implementing strategy.
Everyone must understand the vision, mission, and guiding principles as well
as the quality policies, objectives, and critical processes of the organization.
Business performance must be monitored and communicated continuously.
An integrated business system may be modeled internally and incorporate
the ISO 9000 standards. Every organization has a unique work culture, and it
is almost impossible to achieve excellence in its products and services unless a
good quality culture has been fostered.

5. Strategic and systematic approach

A critical part of the management of quality is the strategic and systematic
approach to achieving an organization’s vision, mission, and goals at Fatima
Fertilizer. This process, called strategic planning or strategic management will
include the formulation of a strategic plan, which will, integrates quality as a
core component.

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6. Continuous improvement
A major thrust of TQM is continual process improvement. Continual
improvement drives an organization to be both analytical and more effective at
meeting stakeholder expectations.

7. Fact-based decision-making
In order to know how well an organization is performing, data on performance
measures are necessary. TQM requires that an organization continually collect
and analyze data in order to improve decision making accuracy, achieve
consensus, and allow prediction based on past history.

8. Communications
During times of organizational change and to implement the developed
strategy, effective communications plays a large part in maintaining drive and
in motivating employees at all levels. Communications involve strategies,
method, and timeliness.

Who should develop the TQM Systems?

Top management learns develops and decides to commit to TQM. TQM is
identified as one of the organization’s strategies. They will assess current
culture, customer satisfaction, and quality management systems. Top
management identifies core values and principles to be used, and
communicates them to the lower levels of management. They will develop a
TQM master plan as they identify and prioritize customer demands and align
products and services to meet those demands.

Who should be in charge of TQM System?

The management at Fatima Fertilizer will map the critical procedure through
which the organization meets its customers’ needs. The management will
oversee the formation of teams for process improvement efforts. The force of
the TQM effort will be managed by the steering committee. Managers will
contribute individually to the effort through planning, training, coaching, or
other methods. Daily process management and standardization will take place
and the progress will be evaluated and the plan will be revised as needed.

19
 Constant employee awareness and feedback on status will be provided and a
reward/recognition process is established.

Financial Feasibility of total Quality Management

The implementation is financially Feasible as Total Quality Management will
lead to employee satisfaction which will lead to process effectiveness leading
to customer satisfaction and more profitability. As explained in the following
diagram. Priorities and timetable will be developed to monitor and ensure
quality.

Employee Process Process

Satisfaction Efficiency Effectiveness

Customer Market and

Satisfaction Profitability

Evaluation & Control

Fatima constantly finds ways to make its directors become more strategic, make
better decisions and be seen to be undertaking best practice governance. Primary
purpose of this exercise is for board members to want to be even better at what
they do. The Pakistan Institute of Corporate Governance (PICG) assesses the
Board performance annually. The annual evaluation encompasses the following
broadly:
• Board Composition
• Board Committees
• Board Procedures
• Board Interaction
• Strategic Planning
• Board and CEO Effectiveness

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• Board Information
• Board and CEO Compensation

The Board assesses the effectiveness of its own collective working and that of its
individual members. Board evaluations are based around directors rating the board
as collective. This represents a true picture as rating is done on a series of
questions related to their responsibilities and functions as a Board. As part of this
exercise Capabilities and Constraints are identified and the next part involves the
Board members to meet and discuss the findings of the data gathered and analysis
to reach an agreement on governance challenges facing the Board and the
development of appropriate action plans designed to address the problems. The
results are then compiled and analyzed, and the report is delivered to the
Chairman. The results also serve as a benchmark for Fatima for the next time a
board evaluation is held. It helps the Company to gauge whether improvements,
which were suggested in the last report, were taken forward and changes were
implemented or not.
Project evaluations are in progress to identify sectors with best possible returns for
future investments by the Company. To capitalize opportunities in Energy,
Cement, Re-gasification, Real Estate and other sectors, the Company will seek all
the required approvals for its future investments in one or more projects.

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