BSEC to appoint 4 independent directors at Zaheen Spinning
Currently, the Zaheen Spinning board has seven members and two of them are independent directors
The Bangladesh Securities and Exchange Commission (BSEC) has suggested the appointment of four independent directors at Zaheen Spinning Ltd.
Independent directors are not shareholders or executives of a particular company. Instead, they join the board with their expertise intending to protect the interest of minority shareholders.
Also, vital board committees that uphold corporate governance within companies are headed by independent directors.
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According to the BSEC's letter to the loss-making company's managing director (MD) dated 20 December, Dhaka University's (DU) Tourism and Hospitality Management Department's Associate Professor Dr Saud Ahmed, MD of Jermatz Ltd Ismat Jerin Khan, DU Banking and Finance Professor Dr Shahidul Islam, and Jagannath University's Associate Professor Dr Taslima Akter are going to join the company's board of directors.
Currently, the Zaheen Spinning board has seven members and two of them are independent directors.
The company's financial performance has been deteriorating since its listing in 2015 and for the fiscal year 2019-20, it incurred a loss of Tk3.39 per share.
And, the company extended its losses in the 2020-21 fiscal year, while most of the spinning mills enjoyed improved profitability in their businesses due to an increase in the price of yarns.
In the July-September quarter, its loss per share stood at Tk0.24. Its annual loss per share was Tk 2.52 in the 2020-21 fiscal year.
In the two loss-making years, the company did not pay any sort of dividend to its shareholders, while its public shareholders did not get any cash dividend since the company entered into the bourses.
Its net asset value per share plunged to TK6.02 at the end of last September, while the face value of each share was Tk10.
The company in its last quarterly report said due to a January 2021 fire incident, its production was disrupted, revenue was hurt, and costs increased impacting its accounts.
Meanwhile, the external auditor in their qualified opinion in the last annual report said they found the company was violating income tax law by paying huge bills in cash.
Zaheen Spinning shares closed at Tk8.8 per share in the Dhaka Stock Exchange on Tuesday.
