The Dhaka Stock Exchange is looking to attract environmentally responsible garment factories to be listed on the exchange. This will allow investors the chance to put money into ethical companies while also helping the factories diversify their funding sources.
The stock exchange plans to sign an agreement with the Bangladesh Garment Manufacturers and Exporters Association to promote this idea. The exchange’s board has already approved the terms of the deal, which should be signed this month.
Under the agreement, the garment association will tell its members about the benefits of listing on the stock exchange. The organizations will also work together on promotional efforts.
“We first want to bring in companies with Leadership in Energy and Environmental Design certification,” said M Shaifur Rahman Mazumdar, the exchange’s acting managing director. “Then we’ll try to attract other sustainable companies with long track records.”
Bangladesh has more of the world’s top environmentally friendly factories than any other country. Getting these highly-ranked green companies on the exchange is a key goal.
Listing shares can help garment enterprises raise funds without giving up ownership. The exchange will also suggest green bonds for companies that don’t want to sell shares. These bonds often have better rates than bank loans.
Some foreign investors want to buy sustainable bonds too, so this could boost foreign investment. The exchange has met with the garment association multiple times about this initiative.
Garment exports, which make up over 85% of Bangladesh’s exports, grew 12.46% in the first two months of this fiscal year. Currently, 58 textile companies are listed on the exchange, though 8 are considered underperforming.
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