Corporate Governance Guidelines in Bangladesh: Some Observations
The Cost and Management, Vol. XL, No. 4, July-August 2012
5 Pages Posted: 28 May 2013
Date Written: 2012
This paper discusses the likely impact of the revised Corporate Governance Guidelines issued by the Securities and Exchange Commission (SEC) in Bangladesh on July 3, 2012. In so doing, it critically examines the changes made in the current guidelines from the one issued on February 20, 2006. It is found that a number of key changes are made in the guidelines; particularly in the areas of independent director requirements, board’s statements, CEO and CFO certifications on financial statements, subsidiary company governance, and reporting and compliance of corporate governance. However, the guidelines could be further improved; for example, by including provisions to ensure true independence of the board and its committees, minimum educational and professional service requirements for non-independent directors, and annual assessments of the board members. The lack of flexibility in the revised guidelines is likely to pose challenges to the listed firms when implementing the guidelines fully. On the part of market regulators, the key challenge will be to ensure enforcement of the regulation.
Keywords: Corporate Governance Guideline, SEC, audit committee, remuneration committee, independent director
JEL Classification: G18, G34
Suggested Citation: Suggested Citation