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Corporate Governance Practices: Ceramic Industry
Corporate Governance Practices: Ceramic Industry
Corporate Governance
Corporate Governance refers to the structures and processes for the direction and control
of companies. Sound corporate governance is a fundamental part of the culture of the
company and ensures long term success. The company believes in adopting the best
practices in the area of Corporate Governance and follows the principles of transparency
and accountability, thereby protecting the interests of management, Board of Directors,
controlling shareholders, minority shareholders and other stakeholders. Strong corporate
governance works as the backbone of an upright organization.
On June 03, 2018, Bangladesh securities and exchange commission published newly
revised CG code for every listed companies as guideline. In Bangladesh this code is a
guideline not law. The guidelines are suggested to follow to get competitive
advantage,listing benefits and to protect shareholders rights. The regulator’s expectation
from these changes is to ensure four pillars of corporate governance–fairness,
accountability, transparency, and responsibility–in the listed companies’ operations and
management. A brief summary of the conditions of that code is cited below-
1. Board of directors
1.7 Code of conduct for the chairperson, other board members and chief executive
officer.
3.1 Appointment
3.2 Requirement to attend Board of Directors` Meetings.
3.3 Duties of Managing Director (MD) or Chief Executive Officer (CEO) and Chief
Financial Officer (CFO)
5. Audit Committee
The ceramic industry is a booming manufacturing sector in Bangladesh. Over the yearsthe
industry has flourished immensely. While it saters to 85 percent of local demand it also
export quality ceramic products to international markets. The growth trend is an indication
of the industry`spontantial to be one the top foreign exchange earners of the country.
There are over a dozen of ceramic factories in Bangladesh, which produce over 40000 tone
ceramic products a year. There are five ceramic companies are listed in the Dhaka Stock
Exchange.
A summary report on the compliance of the above 4 companies- All sections are not
reported, only important section are reported.
C=complied
NC=Non Complied
Monno Ceramic C C C C
Industries Ltd
RAK Ceramics C C C C
(Bangladesh) Limited
C C C C C
Standard Ceramic
Industries Ltd.
Monno Ceramic C C NC NC NC NC
Industries Ltd
RAK Ceramics C C NC NC NC NC
(Bangladesh)
Limited
C C C C C NC
Standard Ceramic
Industries Ltd.
Source: Md. Imranul Islam (23 April, 2019) Corporate Governance Practice in
Bangladesh: Overview of Pharmaceutical & Chemical industry and Ceramic industry of
Bangladesh.
Percentage of Director`s Report Compliance
Average
Board Structure Number Percentage
Board Size 7.25 100.00%
Independent Directors 1.75 24.14%
Executive Directors 1.75 24.14%
Non- Executive Directors 3.75 51.72%
Table: Board Structure and its Qualification of
ceramicIndustry
Figure: Board Structure- Ceramic Industry
Board Structure
Non- ExecutiveDirectors
Source: Md. Ismail Hossain “BOARD SIZE AND NON-EXECUTIVE DIRECTORS AS
MECHANISMS OF CORPORATE GOVERNANCE & CURRENT SCENARIO OF
ExecutiveDirectors
BANGLADESH”
Independent Directors
Board size
0.001.002.003.004.005.006.007.008.00
AveragePercentageAverageNumber