Corporate Governance

Corporate Governance is considered globally as a prerequisite to attracting foreign and domestic investment and to achieving efficiency and economic growth which is essential for private sector development. Against this backdrop, BEI initiated a project on Corporate Governance in 2002 titledComparative Analysis of Corporate Governance in South Asia: Charting a Roadmap for Bangladesh. BEI published a report in August 2003 which was a diagnostic study of corporate governance in India, Pakistan, Sri Lanka and Bangladesh. The report also provided a way forward for Bangladesh, which included recommendations to draft a Code of Corporate Governance for Bangladesh. Subsequently, a National Task Force was formed to draft the Code of Corporate Governance for Bangladesh. The taskforce members met regularly to discuss and debate on each section of the Code and this was finalized and published in April 2004. The Code prescribed Principles and Guidelines on how corporate governance could be gradually introduced in an organization. The Code set the guidelines and standards for best practices of corporate governance in key constituencies. This was the first comprehensive Code of Corporate Governance consisting of provisions for Financial Institutions and NGOs, and was launched in April 2004.

After launching the first comprehensive Code of Corporate Governance for Bangladesh, the next step was the implementation of the Code through advocacy and training programmes so that Chairmen, directors and senior management of Listed Companies, Banks and Financial Institutions, NGOs, and State Owned Enterprises have the necessary tools to apply the principles within their organization. BEI then started its work to raise awareness regarding the cost and benefits of good corporate governance practices among different stakeholders under the Corporate Governance Strengthening Project (CGSP).

Since November 2004, BEI has conducted over 100 days of seminars, roundtables, consultations, and training programmes on corporate governance. More than 3000 chairman, directors, senior management, academics of key constituencies have attended the corporate governance programmes organized under the project. BEI has also been a catalyst in bringing about policy reforms on corporate governance in the regulatory framework of Bangladesh.

Through the various training and capacity building programmes BEI has also created a pool of experts who are equipped with the right skills and knowledge and regularly used by BEI as resource persons in its workshops, seminars and conferences. In addition, BEI invited a number of leading international and local experts on corporate governance in Bangladesh to facilitate the exchange of ideas and information and share cross-country experiences on the best practices of Corporate Governance. The international experts are chosen based on their experience, knowledge, and track record in providing CG training internationally with specific reference to the region.

BEI is also engaged in research on corporate governance and has recently completed a survey of 110 companies in Bangladesh to determine the corporate governance awareness and practices among companies in 19 industrial sectors in Bangladesh. During the period of December 2004 to January 2005, BEI along with its work on strengthening corporate governance in Bangladesh convened the Baseline Study on Corporate Governance practices.The objective of the study was to form a baseline which will help in crafting BEIs future work on corporate governance, in the areas of research, training, outreach, and advocacy, and in assessing the impact on the practices and awareness of corporate governance The baseline study was initiated to gather baseline information in three key areas, namely; effectiveness of the Board, governance pattern of the organization, and awareness on the code of corporate governance in Bangladesh.

In addition to BEI’s advocacy and outreach programmes for the public, private sector and NGO sector, on campus seminars for students were organized at the leading private and public business schools of Bangladesh with the objective to orient the leaders of tomorrow about the importance and significance of the corporate governance education at tertiary level. This in turn will help them to meet the challenges in future and prepare them to be a responsible leader in future. An exam based Essay Competition onPrinciples and Practices of Corporate Governance was also organized by BEI on May 25, 2007 which was open to all graduate and undergraduate students of the public and private business schools. The objective of BEI’s collaboration with the academic partners is to highlight the importance of incorporating Corporate Governance in the tertiary level education in the business schools in Bangladesh.

In June of 2009, BEI had organized a roundtable discussion on global financial crisis and corporate governance for identifying the lessons learned and forecasting the state of the banking sector of Bangladesh in the BEI conference room. The objective of the roundtable discussion was to highlight the importance of good Corporate Governance (CG) practices for the banking sector of Bangladesh, emphasizing more on the context of the global financial downturns.

More recently, BEI launched the Ceremony of the Report on the Observance of Standards and Codes (ROSC): Corporate Governance Country Assessment for Bangladesh in May, 2010. The report, prepared by the World Bank, provides an assessment of Bangladesh’s Corporate Governance policy framework, highlights recent improvements in Corporate Governance regulations, makes policy recommendations, and provides investors with a benchmark against which to measure Corporate Governance in Bangladesh.

Following the ceremony, a three day interactive media workshop on Reporting on Corporate Governance in Bangladesh was successfully organized and completed. Based on the view that “better companies make better societies,” the overall objective of the programme was to draw on journalists’ unique ability to disseminate information on corporate governance to the business community and to the wider reading public, and to make readers aware of company activities that can have significant impact on society. The workshop was a collaborative effort of The Bangladesh Enterprise Institute (BEI), the World Bank group and the IFC Global Corporate Governance Forum (GCGF).

BEI is affiliated with international networks and agencies that are considered to be champions of corporate governance such as Organization for Economic Cooperation and Development (OECD), Global Corporate Governance Forum (GCGF), International Finance Corporation (IFC), Commonwealth Secretariat and the International Corporate Governance Network (ICGN).