BSEC toughens corporate governance code

Staff Correspondent | Published: 00:00, Jan 29,2020

 
 

The Bangladesh Securities and Exchange Commission on Tuesday augmented punitive measures by inserting provision of delisting or suspension of share trading into the corporate governance code for breaching the code by any listed company.

The BSEC made the decision at a commission meeting presided over by its chairman M Khairul Hossain, a BSEC press release said.

It said that the commission approved some amendments to the corporate governance code issued by the regulator.

If any listed company fails to comply with any provision of the CGC, it would be punishable offence under the Securities Ordinance, 1969, the press release said.

Therefore, the commission can, among others, delist or suspend share trading of the defaulting company as per the amendments.

The commission issued the CGC on June 3, 2018, making it mandatory for all listed companies to comply with the rules. The regulator issued the CGC to enhance corporate governance in the interest of investors and the capital market.

Listed companies must provide information of reappointed or appointed directors regarding directorship or other designations in other companies to the shareholders, the amended rules said.

Besides, the commission at the meeting also decided to amend its notification issued on June 1, 2009.

No issuer company must, except with the approval of the general body of its shareholders, enter into any contract for the sale or purchase of assets of 50 per cent (previously it was 1 per cent) or above of the total tangible assets as shown in the statements of financial position as of the end of the immediate preceding completed financial year.

The sales limit cannot be exceeded through individual or joint transaction within one year after the debut on the stock exchange.

The commission at the meeting also decided to warn Continental Insurance as the company did not comply with the corporate governance code regarding the appointment of independent director Shashti Rani Saha.

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