The Privatisation and Corporatisation Board (PCB) has revised the eligibility criteria for Chief Financial Officers (CFOs) and Chief Internal Auditors (CIAs) at state-owned enterprises (SOEs), with the stated aim of strengthening corporate governance. But while the rule change appears to widen the pool of potential candidates, it has also prompted concerns about the possible dilution of merit-based appointments.
The updated regulation, which came into effect immediately upon its issuance on Monday, replaces the earlier framework that required members to hold professional accounting qualifications recognised by the International Federation of Accountants (IFAC). The older rule clearly defined what constituted a qualified accountant and limited eligibility to those who had attained specific certifications from international accountancy bodies.
In contrast, the new rule shifts the focus from professional certifications to broader academic qualifications and practical experience in financial matters. It specifies that committee members must hold relevant academic qualifications and have demonstrable exposure to corporate financial functions such as reporting, auditing, budgeting, and oversight. It also stipulates that at least one member of the committee must be formally qualified in accounting and possess substantial professional experience.
According to the PCB, the intention is to ensure that individuals appointed to these roles are equipped with both the knowledge and the hands-on experience necessary to fulfil their responsibilities effectively. The Board stated that the changes are part of an effort to enhance the governance framework of SOEs, government holding companies, and commercial state entities.
However, the revised language introduces greater discretion for the Board in assessing qualifications. Unlike the previous rule, which provided a clear benchmark through international recognition, the new version allows PCB to interpret what constitutes sufficient experience and relevant qualifications. This has led to questions about whether such flexibility could be used to appoint individuals who may not meet the highest professional standards.
Critics argue that while broadening eligibility may attract a more diverse range of applicants, it also opens the door to potential political appointments or selections based on proximity rather than merit. Without transparent mechanisms to evaluate candidates’ practical experience and academic credentials, the risk is that key financial oversight roles could be filled by individuals lacking the rigour previously guaranteed through certified qualifications.
This concern is particularly relevant given the critical function CFOs and CIAs play in overseeing public finances, especially in entities engaged in specialised or complex financial activities. Weakening the technical requirements for such positions could undermine the credibility of financial audits and compromise the integrity of financial reporting across SOEs.
The PCB has also introduced a new procedure for the appointment and dismissal of CFOs and CIAs. The effectiveness of these procedural safeguards will likely determine whether the new flexibility strengthens governance—or undermines it.
Ultimately, while the revised regulation may reflect an effort to respond to talent shortages and make appointments more inclusive, it also demands a higher degree of transparency and accountability from the PCB. The reform’s success will depend not only on its intent but also on how rigorously it is enforced and whether it remains insulated from political influence.
As the new framework is applied in practice, its impact on the quality and independence of financial oversight within Maldivian SOEs will become clearer. Until then, questions about the balance between flexibility and standards will continue to shape the debate.
