Corporate sector calls for stronger safeguards
Tariq Khattak
ISLAMABAD, Sept 12 –:The Securities and Exchange Commission of Pakistan (SECP) is under mounting scrutiny over its growing dependence on contract staff, raising urgent concerns about data security, operational stability, and regulatory effectiveness. The corporate sector has pressed the regulator to retain permanent employees and fortify safeguards for sensitive information.
The SECP, which oversees Pakistan’s capital markets, corporations, insurance sector, and non-bank financial companies increasingly relies on third-party contractors to fill operational gaps. This shift has created a two-tier workforce with unequal benefits, heightened operational and security risks, and noticeable unease among staff, according to insiders.
Sources indicate that the commission supplements sanctioned positions with externally sourced personnel for both project-based and routine operations. While SECP Service Regulations allow multiple appointment categories, the latest annual report does not disclose the permanent-to-contract staff ratio, raising transparency concerns.
Contract employees often handle price-sensitive data, corporate filings, and personally identifiable information without receiving standard benefits or job security, increasing the risk of leaks. In Pakistan, a massive personal data breach exposed over 184 million records, including mobile subscriber details, call logs, and national identity cards. Globally, the 2017 Equifax breach compromised the personal data of more than 147 million Americans, demonstrating the risks of insufficient oversight of third-party staff.
Data breaches and leaks have become routine worldwide, affecting governments, financial institutions, and private companies alike. High-profile incidents underscore how inadequate oversight of outsourced or contract staff can compromise sensitive information. These global patterns underscore the need for regulators like SECP to implement stringent access controls, thorough audits, and robust security protocols for all employees handling confidential data.
“The absence of standard benefits for contract staff creates morale issues and increases risk in critical areas like filings, inspections, and enforcement,” said an insider on condition of anonymity. Experts stress that regulators must maintain consistent protocols and audit trails for all staff categories, regardless of employment status.
Staffing instability is not just a matter of internal operations, but it has direct and potentially severe consequences for market efficiency. Investors and listed companies rely on the timely processing of prospectuses, mergers, and beneficial ownership filings. Delays or inconsistencies could not just affect, but significantly undermine investment decisions and confidence in the financial system. Citizens, too, depend on accurate corporate record-keeping and insurance protection, which could be compromised if staff rotate frequently or feel uncertain about their employment.
Business leaders are not just requesting, but demanding immediate transparency measures. These include the disclosure of the exact proportion of permanent versus outsourced staff and the publication of a comprehensive staffing strategy with clear targets and timelines for regularizing critical roles. This transparency is not just desired, but seen as essential for maintaining public trust in SECP operations.
The controversy raises questions about Pakistan’s regulatory governance and whether cost-cutting measures could compromise oversight quality. Maintaining workforce stability remains essential to ensure effective, transparent financial regulation.
While SECP promotes cost-cutting measures, the regulator faces serious allegations of illegally increasing salaries by millions and mismanaging billions in public funds, creating the perception that austerity is imposed on lower-level staff. At the same time, the chairman, commissioners, and directors enjoy unchecked spending. The commission has not yet responded to requests for comment.
