Governance | Cherat Cement

Governance

CHAIRMAN’S REVIEW

The country has emerged from a global pandemic, characterised by constant change and uncertainty. Global commodity prices particularly energy and fuel, witnessed significant fluctuations due to changes in demand and supply. As a result, the world economy is possibly facing a recession. Apart from these challenges, Pakistan is also affected high inflation, depleting foreign exchange reserves, and political instability. The Government has had to implement harsh fiscal and monetary measures in an effort to resume the IMF program. These circumstances have adversely affected the demand for cement in the country. On aggregate, cement sales declined by 16% during the year. Local and export sales went down by 16% and 13%, respectively. However, there is some improvement in exports to Afghanistan which increased by 17% during the year. Despite all these challenges, your Company managed to record an after-tax profit of Rs.4,403 million through operational efficiencies. The coming year appears to be challenging but the business community is hopeful of some economic recovery on the back of the IMF programme.

BMR work on cement Line 1 has been completed successfully. The commissioning of WHR on Wartsila Dual Fuel (WDF) engines has also been completed after installation of a new turbine during the year. These projects will help in bringing about further efficiency in our processes.

The Company remains committed to best sustainability practices. We are taking all the measures to protect the environment and serve the community we belong to. Over the years, we are investing heavily in renewable energy projects like Waste Heat recovery (WHR), Solar panels installation, LED lights and WHR on WDF engines etc. These projects have not only helped us in reducing the carbon footprint but have also resulted in reduction in cost of production. We have significantly increased plantation at our manufacturing facility. We are also working for protection of wildlife. We have taken many measures to improve the health and safety practices in our organization. As a responsible corporate, we are continuously contributing towards the social uplift of our nearby areas. Our priority is education, health, drinking water and women empowerment and different projects are in place to achieve these goals. We have also helped the flood affected during the year and supported their rehabilitation process. We believe that all these efforts will bring a positive change in the society which eventually is beneficial for the Company and the country.

I am pleased to report that the Board of Directors has performed its duties and responsibilities meticulously and has contributed towards guiding the Company in its strategic affairs. It focused on major risk areas and remained actively involved in the strategic planning process of the Company. The Board recognises that well defined corporate governance processes are important to preserve and enhance stakeholders’ value. All Directors including Independent Directors, fully participated and contributed to the decision-making process of the Board. The Board carried out its annual self-evaluation in line with the requirements of Code of Corporate Governance.

I would like to take this opportunity to extend my appreciation to the staff, customers, suppliers, bankers. Board of Directors, and shareholders for their continued support, commitment and hard work.

Omar Faruque

Chairman

BOARD OF DIRECTORS

Mr. Omar Faruque - Chairman

Non Executive Director

Mr. Omar Faruque studied from the City of London. Polytechnic London, and got a Honours degree in B.A. Finance. Currently, he is the Chief Executive of Zensoft (Pvt.) Limited and a Director of Greaves CNG (Pvt.) Limited. He is a 'Certified Director' from the Pakistan Institute of Corporate Governance.
Mr. Azam Faruque - Chief Executive

Executive Director

Mr. Azam Faruque is the Chief Executive of Cherat Cement Co. Ltd. He is an Electrical Engineering and Computer Science graduate from Princeton University, USA. He completed his MBA with high honors from the University of Chicago, Booth School of Business. Apart from the time he has spent in the cement industry, he has also served as a member on the Boards of State Bank of Pakistan, National Bank of Pakistan, and Oil and Gas Development Corporation Ltd. He was a Member of the Board of Governors of GIK Institute, Member of the National Commission of Science & Technology and also a Member of the National Committee of the Aga Khan Foundation. Mr. Azam Faruque has served on the Board of the Privatization Commission of the Government of Pakistan, Madian Hydro Power Ltd., Atlas Asset Management Ltd., international industries Ltd., Atlas Battery Ltd. and was the Chairman KPK Oil & Gas Development Company Ltd.

At present, he is a member of the Board of Directors of Faruque (Pvt.) Ltd., Greaves Pakistan (Pvt.) Ltd., Unicol Ltd., Indus Motor Company Ltd., and Habib University Foundation. He is a 'Certified Director' from the Pakistan institute of Corporate Governance.
Mr. Akbarali Pesnani - Director

Non Executive Director

Mr. Akbarali Pesnani is an MBA and fellow member of both the Institute of Chartered Accountants and Institute of Cost and Management Accountants of Pakistan. He has served as Chairman Gwadar Port and Gwadar Port Implementation Authority from 2004 to 2006. Mr. Pesnani has been associated with the Aga Khan Development Network at senior levels for over 48 years. Presently he is the Chairman of Cherat Packaging Ltd, Aga Khan Cultural Service Pakistan, Jubilee General Insurance Co. Ltd. and a Director on the Board of Agha Steel Ltd. and Pakistan Cables Ltd. His association with the Ghulam Faruque Group dates back almost 42 years.
Mr. Arif Faruque - Director

Non Executive Director

Mr. Arif Faruque is a Swiss - qualified Attorney-at-Law and also holds Masters degrees in both Law and Business Administration from the USA and is currently enrolled in the OPM Program at Harvard Business School. He is the Chief Executive of Faruque (Pvt.) Ltd. He is on the Board of Directors of Mirpurkhas Sugar Mills Ltd., Cherat Packaging Ltd. and UniEnergy Ltd. Besides the above, he is also a member of the Board of Governors of Lahore University of Management Sciences (LUMS).
Mr. Asif Qadir - Director

Independent Director

Mr. Asif Qadir holds a degree in Chemical Engineering from Columbia University, New York. He joined Exxon Chemical Pakistan Limited in 1978 as a Process Engineer and held various assignments in manufacturing and marketing of fertilizers.

Mr. Qadir has served as President and Chief Executive Officer of Engro Polymer & Chemicals Ltd. He has also served on the Board of Engro Corporation Ltd., Engro Fertilizer Ltd., Engro Polymer & Chemical Ltd., Engro Powergen Ltd., Sindh Engro Coal Mining Company Ltd., Karachi Stock Exchange., Pakistan Poverty Alleviation Fund and Inbox Business Technologies (Pvt.) Ltd.

He is currently serving as Director in Unicol Ltd. and is also on the Boards of Tripack Films Ltd., Descon Oxychem Ltd., Liaquat National Hospital and Medical College and Century Paper & Board Mills Limited.
Mr. Abrar Hasan - Director

Independent Director

Mr. Abrar Hasan serves as the Chief Executive Officer and as a Director on Board of National Foods since 2000. National Foods is the leading multi-category food company in Pakistan producing over 250 different products, marketed both in Pakistan and exported to 40 countries worldwide. Under his leadership, the company has delivered steady sales growth year on year and tremendous success. Mr. Hasan is providing direction and leadership to the company by setting a clear vision for future growth and has actively pursued new market opportunities and delivered successful strategies to drive the company's vision, focusing on continuous innovation, highest standards of quality and superior consumer value.

He graduated with a BS in Industrial Management and a minor in Industrial Engineering from Purdue University, Indiana, USA. He was elected on the Board of Cherat Cement Company Ltd. as an independent director on October 16, 2018. Mr. Abrar Hasan is also the Chairman of Board for Naymat Collateral Management Company, which is Pakistan's first Collateral Management company, that facilitates and empowers farmers by making formal credit accessible to them through financial institutions. Besides this, he is a also a Director of Associated Textile Consultants (Pvt.) Ltd., Pakistan Business Council, The Health Foundation and Engro Foods Friesland Compina. He is a Certified Director from the Pakistan Institute of Corporate Governance.
Mrs. Zeeba Ansar - Director

Independent Director

Mrs. Zeeba Ansar has over 27 years of private and corporate banking experience. She did her Bachelors in Economics and Statistics from the University of Punjab and then completed her MBA in Marketing and Finance from the Institute of Business Administration. In her career as a banker she has worked with Deutsche Bank AG as Manager Corporate Banking Department and Faysal Bank as Senior Vice President and Corporate Head-South. She then joined UBL as Executive Vice President and Regional Corporate Head-South and retained the position for 10 years. Her most recent professional engagement was with NIB Bank as Group Head-Corporate and Investment Banking where she worked till 2017.

She is currently serving as Director in Gul Ahmed Textile Mills Ltd. and Samba Bank Ltd. She is also a 'Certified Director' from the Pakistan Institute of Corporate Governance.
Mr. Yasir Masood - Director

Executive Director

Mr. Yasir Masood is a fellow member of the Institute of Chartered Accountants of Pakistan. He is a Certified Internal Auditor (CIA) and qualified Certified Information Systems Auditor (CISA). He is also a certified Director from Pakistan Institute of Corporate Governance. He is serving as the Director and Chief Operating Officer of Cherat Cement Company Ltd, and also serving on the Boards of Greaves Airconditioning (Pvt.) Ltd, Greaves CNG (Pvt.) Ltd, and Greaves Engineering Services (Pvt.) Ltd.

Mr. Yasir is also serving as Chief Financial Officer of Faruque (Pvt.) Ltd. He has been working and contributing in various committees of different Business forums. He is currently serving as Industry Expert and member of Arbitration panel of Pakistan Stock Exchange Limited (PSX).