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The argument is based on the fact that such directives are not usually seen in the global stock market arena.

“If sponsors are efficient, then they are chosen to run the company based on their merits and not because of their ownership rights,” he said, adding that this is a good move for the local stock market nonetheless.

When a company’s sponsor holds a majority stake, then that company performs better while dividends are also very lucrative.

On the other hand, when a company is drowned in junk stocks, it is usually seen that the firm’s sponsor has a very minimum shareholding. Considering the facts, it seems that high shareholding among directors is a good sign for any company, the broker said.

The companies whose directors do not hold a minimum 2 per cent stake in their own firms are: Continental Insurance, Purabi General Insurance, Mercantile Insurance, Prime Islami Life Insurance, Meghna Life Insurance, Asia Insurance, Bangladesh General Insurance, Dulamia Cotton, Eastern Insurance, Exim Bank, Imam Button, Intech Bd, Karnaphuli Insurance, Kay & Que, Progressive Life Insurance, Provati Insurance, United Airways, Fu-Wang Ceramic, Standard Insurance, Wata Chemicals, Bangaldesh National Insurance and Paramount Insurance.