The Securities and Exchange Commission of Pakistan (SECP) has approved key amendments directing the Pakistan Stock Exchange (PSX) to prepare Shariah indices within the next twelve months.

The move is designed to enhance transparency and improve investor confidence in the market.

The SECP announced that the PSX must either develop Shariah indices internally or collaborate with a third-party provider. The amendments are part of broader efforts to increase transparency in the stock market and strengthen investor protection mechanisms.

All actions taken against listed companies will now be publicly disclosed on the PSX website, enabling investors to make more informed decisions.

Companies to provide key financial information

Under the new directives, companies listed on the PSX will be required to provide detailed information on income, debt, and investments. This will facilitate more effective Shariah-compliant screening and ensure that companies included in the indices meet required criteria.

The SECP emphasized that these changes will standardize reporting and make it easier for investors seeking Shariah-compliant investment options to evaluate potential opportunities.

By making company data publicly accessible and formalizing Shariah screening, the amendments aim to increase market credibility and investor confidence. Analysts say that clearer financial disclosures will reduce information asymmetry and strengthen Pakistan’s capital markets.