Staff Reporter :
The DSE Brokers Association of Bangladesh (DBA) has urged the government to reform the board structure of the Dhaka Stock Exchange (DSE), advocating for a reduction in the number of independent directors and more balanced representation among stakeholders.
In a letter dated 17 July addressed to Anisuzzaman Chowdhury, special assistant to the Chief Adviser and chair of the committee tasked with strengthening the Bangladesh Securities and Exchange Commission (BSEC), the DBA criticised the current board composition under the 2013 Demutualisation Scheme.
Currently, the DSE board comprises 13 members: seven independent directors, four shareholder directors, one nominee from a strategic investor, and the managing director (MD) as an ex-officio member. The chairperson is required to be chosen
from the independent directors.
The association argued that this arrangement has become counterproductive, noting that many independent directors appointed in the past lacked capital market experience and were selected based on political considerations. This, the DBA claimed, has led to poor governance and decision-making.
“The dominance of non-stakeholding independent directors has resulted in decisions that conflicted with the interests of market participants,” the letter stated.
The DBA warned that such politicisation has undermined market discipline, damaged investor confidence, and weakened the institutional integrity of the DSE. It also expressed concern that future governments might continue to exploit board appointments for political gain.
To enhance governance and restore investor trust, the DBA proposed a revised board of 11 members: five independent directors, four shareholder directors, one strategic investor nominee, and the ex-officio MD. It further recommended permitting any board member, except the MD, to be eligible for the chairperson’s role, rather than restricting it to independent directors.
The letter also addressed regulatory oversight, noting that the Chief Regulatory Officer (CRO) currently reports exclusively to the Regulatory Affairs Committee (RAC), bypassing the MD or CEO. The DBA suggested that the CRO should also report to the MD on regulatory matters to improve coordination and foster trust between intermediaries and exchange leadership.
Finally, the association called for the removal of the fixed organisational structure mandated by the Demutualisation Scheme, which it said limits flexibility in updating roles and departments. It recommended granting the DSE board the authority to make necessary structural changes.
The proposed reforms aim to improve accountability, reduce political influence, and establish a more effective governance framework to support the long-term development of the capital market.
