2024-09-10 06:40:28
Bangladesh Securities and Exchange Commission (BSEC) has sought guidance from the Ministry of Finance to resolve the complexity of appointing independent directors in the country’s main capital market Dhaka Stock Exchange (DSE).
On September 4, the executive director of BSEC. According to the relevant sources, a letter in this regard signed by Anwarul Islam has been sent to the Secretary of the Financial Institutions Department of the Ministry of Finance.
According to BSEC’s letter, the commission approves the appointment of independent directors of stock exchanges following a proposal submitted by the Nomination and Remuneration Committee (NRC) of the stock exchange. However, due to the resignation of the independent director of DSE, there is currently no NRC committee of the exchange. In the absence of which, there is no opportunity to submit proposals from DSE to the commission regarding the election of individual directors. Also, due to lack of required number of directors, there is no opportunity to form NRC committee. Accordingly, the Board of Directors of DSE is not fully functional as per law as there is no independent director at present.
However, in order to protect the interests of investors and the overall development of the stock market, the appointment of independent directors is necessary and urgent, BSEC has mentioned in the letter. For that reason, according to the decision of the 918th emergency commission meeting on September 1, according to Section 24 of the Exchanges Demutualization Act, 2013 and other related laws, KAM Majedur Rahman was appointed as an independent director.
The letter further mentions that Majeedur Rahman was previously appointed as a nominated director on the board of directors of Dhaka Stock Exchange trackholder AK Khan Securities Limited from December 7, 2020 to October 4, 2022. Presently Majedur Rahman is not associated with any organization mentioned in Regulations 5(5)(f) and 5(5)(g) of DSE Board and Administration Regulations 2013. However, since he was appointed as a nominee director on the board of directors of AK Khan Securities, his appointment became complicated.
In such a situation, as per section 26 of the Exchanges Demutualization Act, 2013, for the formation of the board of directors of DSE and for the proper management of the stock market, the government’s direction is urgently needed to resolve the said complications.
Incidentally, seven independent directors of DSE were appointed in the 918th Commission meeting held under the chairmanship of BSEC Chairman Khandkar Rashid Maqsood on September 1. Independent directors are – Chairman of Maldives Islami Bank KAM Majedur Rahman, Director General of Army Institute of Business Administration – Professor Major General (Retd.) Dr. Md. Kamruzzaman, Additional Secretary of the Financial Institutions Department of the Ministry of Finance. Nahid Hossain, Brigadier General of 46 Brigade of Bangladesh Army. Mofizul Islam Rashed, Research Director of Center on Integrated Development for Asia and Pacific (SIRDAP). Md. Helaluddin, former General Manager of Metlife Bangladesh Syed Hammadul Karim and Managing Director and CEO of Bangladesh Data Center and Disaster Recovery Site Limited, Chief Information Security Officer (CISO) Bangladesh Bank (LIEN) Md. Isaac Mia.
Among these individual directors of DSE AM Majedur Rahman, Dr. Nahid Hossain and Dr. Mohammad Helal Uddin There has been a controversy over the appointment of these three. BSEC has sought guidance from the Financial Institutions Department of the Ministry of Finance to resolve the complications in such a situation.