Experts for reforms to improve corporate governance

Experts at a discussion here on Saturday recommended reforms in the regulations and guidelines for financial institutions in the country to ensure better corporate governance (CG) in the sector.They said lack of a comprehensive CG guideline, including the nomination and the role of the directors in the governing bodies, has been a major cause behind the failures of the companies in the corporate sector.
The experts came up with the observations at a roundtable discussion, titled “Effective Implementation of Corporate Governance in Bangladesh,” jointly organised by The Institute of Chartered Accountants of Bangladesh (ICAB) and the International Finance Corporation (IFC) at a city hotel.
Speaking on the occasion, ICAB vice president M Farooq said the board of directors of a company should be separated from its management to ensure better corporate governance.
He noted that the tradition of nominating directors of state-owned financial institutions on political consideration should be stopped to stop irregularities. “Nomination of directors has been the main reason for most of the scams in recent times,” he added.
ICAB president Abdus Salam recommended that there should be a harmonisation of the CG guidelines among the Companies Act 1994, Bangladesh Securities and Exchange Commission rules, Bank Company Act 1991 and Bangladesh Bank (BB) circulars and guidelines.
In her keynote presentation, Barrister Sheela Rahman recommended the central bank issuing the CG instructions in the form of a Master Circular.
BB general manager KA Wadood said the central bank is working to ensure good corporate governance in the banking sector through identifying the risk factors and initiating better regulatory mechanism.
Presided over by ICAB president Abdus Salam, the roundtable discussion was also addressed by IFC’s Corporate Governance Project consultant Lopa Rahman and ICAB member Adeeb Khan. UNB

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