Forty-one publicly listed companies have not yet ensured a 30% shareholding by their sponsors and directors as required by the stock market regulator.
As per the securities regulator's directive, sponsors or promoters and directors must jointly hold a minimum 30% shares of the paid-up capital of a company all the time.
The sponsors and directors of the companies in question are holding their positions in violation of a 2011 directive issued by the Bangladesh Securities and Exchange Commission (BSEC).
The regulator came up with the order in the aftermath of the stock market crash in 2010. The move was aimed at making the directors responsible and loyal to small investors, as it was seen that many directors had sold off their shares right before the debacle.
On July 29 this year, the new leadership of the securities regulator asked 44 listed companies to ensure that their sponsors and directors jointly hold at least 30% shares in their own companies within the next 60 days.
As per the BSEC information on Monday, 41 listed companies have not yet complied with the directive as of August this year.
Only three companies – BD Thai Aluminum, Bangladesh General Insurance, and Emerald Oil Industries Ltd – have complied with the rules by this time.
The new commission has taken an initiative to strictly enforce a provision that requires the sponsor-directors of the listed companies to hold a certain number of shares.
It also decided to direct its enforcement department to take legal action against directors of listed companies who were not holding at least 2% shares of the paid-up capital individually.
Stock investors have alleged that many sponsors and directors are holding the controlling power at different companies even after selling off their shares.
Meanwhile, stakeholders have said that if the minimum 30% shares are held by sponsors and directors, it could help ease the ongoing liquidity crisis in the capital markets through the release of a substantial amount of funds.