Director Appointment Agreement Template for Pakistan

A Director Appointment Agreement spells out the terms and conditions when someone joins a company's board of directors in Pakistan. This legal contract covers key details like the director's role, responsibilities, compensation, and term length, following requirements set by the Companies Act 2017.

The agreement protects both the company and the incoming director by clearly defining reporting lines, meeting obligations, and confidentiality requirements. It also addresses important compliance matters under Pakistan's Securities and Exchange Commission (SECP) regulations, including disclosure of other directorships and potential conflicts of interest.

Use a Director Appointment Agreement when bringing new directors onto your company's board in Pakistan, especially for private limited companies and listed firms. The timing is crucial - put this agreement in place before the director starts their duties, ideally right after the board resolution approving their appointment.

This document becomes particularly important during corporate restructuring, when appointing independent directors, or when specific expertise is needed on the board. It helps prevent future disputes by clearly documenting SECP compliance requirements, performance expectations, and compensation terms from day one of the appointment.

• Basic Director Agreement: Covers standard appointment terms, duties, and compensation for regular board members in private companies
• Executive Director Agreement: Includes additional provisions for directors who also hold management positions, detailing their operational roles
• Independent Director Agreement: Features specific compliance clauses required by SECP for listed companies, including independence criteria
• Nominee Director Agreement: Contains special provisions for directors representing specific shareholders or institutional investors
• Non-Executive Director Agreement: Focuses on oversight responsibilities and committee roles, with lighter operational involvement

• Company Secretary: Drafts and maintains the Director Appointment Agreement, ensuring compliance with SECP requirements
• Board of Directors: Reviews and approves the agreement terms before presenting to new appointees
• Incoming Director: Reviews, negotiates, and signs the agreement before taking up the position
• Legal Counsel: Provides expert guidance on terms and ensures the agreement meets regulatory standards
• HR Department: Handles administrative aspects and maintains records of director appointments
• Company Shareholders: May need to ratify certain director appointments, especially in listed companies

• Director Details: Gather the appointee's full legal name, CNIC, residential address, and any existing directorships
• Board Resolution: Confirm the appointment approval date and resolution number
• Role Specifics: Define exact duties, committee assignments, and reporting relationships
• Compensation Package: Document meeting fees, annual retainer, and any additional benefits
• Term Details: Specify appointment duration, renewal conditions, and termination clauses
• Compliance Points: Note relevant SECP requirements and Companies Act provisions
• Company Information: Include registration number, registered office address, and authorized representatives

• Parties and Recitals: Full legal names of company and director, company registration details
• Appointment Terms: Position title, effective date, and duration of appointment
• Duties and Powers: Specific responsibilities, committee roles, and decision-making authority
• Remuneration: Meeting fees, annual retainer, allowances, and payment schedule
• Confidentiality: Protection of company information and trade secrets
• Conflict of Interest: Disclosure requirements and handling procedures
• Termination Clauses: Conditions for ending the appointment and notice periods
• Governing Law: Reference to Pakistan Companies Act and SECP regulations

A Director Appointment Agreement differs significantly from a Director Services Agreement in both scope and purpose. While both documents relate to director roles, they serve distinct functions in Pakistan's corporate governance framework.

• Primary Purpose: Director Appointment Agreements focus on establishing board membership and governance duties, while Director Services Agreements detail specific operational or consulting services beyond standard board responsibilities
• Compensation Structure: Appointment agreements typically cover board fees and meeting allowances, whereas services agreements include detailed fee structures for additional professional services
• Legal Framework: Appointment agreements align with SECP's board governance requirements, while services agreements follow contract law and professional services regulations
• Duration Terms: Appointment agreements usually align with board terms, but services agreements often have project-specific or fixed-term durations