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EXECUTIVE SUMMARY

Corporate governance (CG) deals with the problems that result from separation of ownership and control. In this way, corporate governance (CG) is an important effort to ensure transparency, accountability, responsibility and integrity of the companies, which should be incorporated into every part of the organization. This study focused on three state of Corporate Governance (CG): Progress and Prospects of Corporate governance (CG). To understand the state of CG, some broad aspects of governance and management issues were studied. These are: a) shareholders rights, b) public disclosure of information, c) effectiveness of the Board, d) Ownership and control structure of the company on the basis of OECD, CODE of Corporate Governance (CG), Corporate Governance (CG) Guidelines of Securities and Exchange commission of Bangladesh. Within each of these many sub-categories were studied which were discussed in this paper. Corporate Governance is to protect the rights of Stack-holders, to transparent about its activities on profits or benefits related parties, to Comply with the rules and regulation of the state and corporation and to Show the corporate performance and accountability towards stockholders. Good corporate governance recognizes the diverse interests of shareholders, lenders, employees, government, etc. For this reason, in 2004, Bangladesh Enterprise Institute (BEI) published the Code of Corporate Governance (CCG) for Bangladesh that is suited for, among others, financial institutions. But, Bangladesh is still standing behind its neighboring countries and the global economy in Corporate Governance. One reason for this slow progress in adopting CG is ownership structures. On the other hand, SEC, DSE and CSE are the prominent parties worked for fulfilling stakeholders interest of the corporation. Towards the recent situation of Capital Market in 2011, SECs action thus seemed largely reactive to market development, rather than anticipatory or even contemporaneous. There is no doubt, Bangladesh is suffered several obstacles in Corporate Governance practice, because absent of corporate culture and professionalism in the corporation. Inefficiency of the regulatory bodies, corruption, asymmetric information, Proxy contest and other male practice

in capital market, slow adoption of corporate governance and in election and appointment of the board are recently formulated problems in Corporate Governance. CG practices in Bangladesh are gradually being introduced and improved in most companies and organizations. At last Code of Corporate Governance published in March 2004. The Code of Corporate Governance prescribes the principles, procedures and process through which better corporate governance practices may gradually be introduced. Corporate Governance Guideline of Securities and Exchange Commission has been introduced in 2006 for best practice by listed company in it. Bangladesh bank is working to establish a team of experts whose primary responsibility will be to monitor the performance of the banking sector for good risk management and Corporate Governance From Chi-square test, it could be said that banks are practicing more Corporate Governance (CG) than insurance in short term activities and their strength is staying in strong credit rating influence their growth as superior and as secure. Equity rating has been conducted for finding out the position of corporate governance practice by companies. From the sample 131 companies, maximum company is ratted in b level credit rating. From the chart, it has been shown that 29 companies are rated as BBB3 rating. By analyzing the capital market, it can be said that listed companies in the Stock Exchanges also follow the Code of corporate governance of Bangladesh and the OECD principles. It is clear these companies are really contributing in the GDP of the country for further growth of economy. Form this study; it has been found Corporate Governance is not understood to most of the companies. The improvement is very slow regarding the practice of Corporate Governance. Listed companies in securities exchanges are complying to the Corporate Governance guidelines of Securities and Exchange Commission. Code of Corporate Governance is one of the milestone achievements in Corporate Governance history of Bangladesh. Recommendation could be given this way. Firstly, key concepts in CG need to be clarified and the applicability of international CG good practices addressed. Corporation would emphasize- How to promote greater shareholder activism? How to increase awareness of shareholders

of their capacity to intervene in company affairs? The merits of greater transparency, i.e. how greater disclosure enhances the value of the corporation, are poorly understood by companies. Asymmetric information is one of the crucial tribulations in CG. Asymmetric information should not be provided to the share holder. Board play a vital role in making cumulative voting a more widespread practice, concentrated ownership structures as well as a lack of consensus on the benefits of cumulative voting remain obstacles. Board would regularly introduce appropriate internal control structures such as risk management requires a change in corporate culture going beyond mere compliance with rules. Electronic devices should be introduced in Board of Directors Election. At last, Corporations could realize that their firms value depends on good corporate governance and Good corporate governance recognizes the diverse interests of shareholders, lenders, employees, government, etc. The new concept of governance tried to bring about quality corporate governance.

MD. Hasanuzzaman MBA-6th Batch, SUST Shahjalal University of science and Technology, Sylhet

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