Bangladesh Securities and Exchange Commission (BSEC) Chairman Masud Khan has said the country must first develop a functional conventional bond market before promoting sustainable bonds, as issuing bonds remains more expensive and time-consuming than obtaining bank loans.
Speaking as the chief guest at the Sustainability Summit 2026 in Dhaka on Saturday, Khan said the absence of an effective bond market has remained one of the country's longstanding weaknesses in capital market development.
"Bangladesh does not yet have a functioning bond market," he said. "Apart from government securities (G-Secs), no other bonds are traded on the main board of the Dhaka Stock Exchange. That is the current reality."
The day-long summit was organised by Bangladesh Brand Forum and Sustainable Brand Initiative under the Bangladesh Innovation Conclave at the Radisson Blu Water Garden Hotel.
Khan said sustainable bonds would be essential for financing future development, but Bangladesh was not yet ready because the conventional bond market itself had yet to become effective.
"We must move towards sustainable bonds eventually. However, before that, we need to strengthen the foundation of the traditional bond market," he said.
The BSEC chairman said he had identified the key obstacle shortly after assuming office.
"If I want to borrow from a bank, I can obtain financing within three months at a fixed cost. But raising funds through bonds takes about a year and costs more. Naturally, businesses will choose bank loans," he said.
He said the commission would work to reduce the time required for bond issuance and lower the cost of raising funds through bonds so that it becomes cheaper than bank borrowing.
"We will implement reforms to shorten the bond issuance process and make bond financing more cost-effective," he added.
Turning to the stock market, Khan expressed concern over the dominance of retail investors, saying many invest without sufficient knowledge of the market.
"Unfortunately, most investors in our stock market are retail investors. Many do not have a proper understanding of shares and invest simply because someone tells them prices will rise," he said.
On corporate governance, Khan stressed that companies with sound governance practices enjoy greater public confidence.
He said independent directors in Bangladesh often fulfil only a legal requirement rather than making meaningful contributions to corporate oversight.
"Many independent directors still do not know how to contribute effectively in board meetings. They need more training and greater awareness," he said, drawing on his experience of serving on the boards of multinational companies operating in Bangladesh.
In his opening remarks, Bangladesh Brand Forum Founder and Managing Director Shariful Islam said sustainability should no longer be treated as an annual discussion but embedded into the core of every business.
"As Bangladesh moves towards achieving the Sustainable Development Goals by 2030 and prepares for graduation from the least developed country category, responsible business is no longer optional. It is the foundation of our competitiveness," he said.
The summit brought together leading business executives, policymakers, industry experts, academics and social entrepreneurs to discuss sustainability, responsible business practices and corporate governance.
