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Friday, July 25, 2014

Sunday, August 5, 2012
OP-ED

Why is the government damaging the high reputation of Prof. Yunus?

Professor Yunus

It is time for all conscious citizens to demand from the government why it has chosen to damage the image and high reputation that Professor Yunus had earned nationally and internationally. Long before he and Grameen Bank received the Nobel Prize, he had earned respect within the country for the innovative mode of providing credit to landless women, starting from modest beginnings in the Chittagong University Campus. He had tirelessly worked to disseminate these ideas to develop the organisational base starting from a handful of units in some thanas to a national scale operation in 2012.

The success of the initiative had led to the emergence of Grameen Bank. This was followed by an even more bold initiative of vesting the ownership of the Bank (97% of its shareholdings) in its women shareholders, and for them to elect its Board of Directors. This was widely acclaimed within the country and internationally and earned the Nobel Prize.

The latest in a series of actions directed at Professor Yunus and the Grameen Bank raises serious questions which must be answered by the government. The first such action was a letter from the Bangladesh Bank which charged that his appointment eleven years earlier had been improper because he had passed the official retirement age. Prof. Yunus promptly filed a writ petition submitting with it documents proving that his appointment had been duly made with approval from the Board of Directors. The directors included three government nominees, secretaries to different ministries. The Bangladesh Bank was fully informed of his appointment and dealt with him for the next 11 years as managing director.

Prof. Yunus was denied justice as the High Court refused to admit his writ petition, bizarrely stating that Prof. Yunus did not have "locus standi" to do so! In other words, they held that he was not eligible to file the petition, because he could not show how he had been aggrieved by the Bangladesh Bank's decision, although he had been removed from service. When Prof. Yunus sought permission from the Appellate Division, our highest court, to appeal against this indefensible order, the Court quite inexplicably denied this.

The government did not file a single document in response to the documents filed by Prof. Yunus. Instead, it began to direct misleading and baseless statements against Prof. Yunus. In court when the government's lawyers falsely asserted that Prof. Yunus was trying to maintain his managing directorship beyond the age of retirement, he filed his letter to the finance minister written two years earlier asking for a search committee to find a successor for him. He did this, though the Board had earlier clearly taken a resolution that there was no retirement age for his position, and that he should continue in office until they decided otherwise.

The Board of Directors includes nine rural women members. They have been elected by eight million borrower members of Grameen Bank. These women directors had also gone to court to challenge the legality of the Bangladesh Bank's letter. Incredibly, the court also rejected their petition, noting that they had no "locus standi!" This meant that the court said that they could not challenge an order although it directly interfered with their powers to appoint a managing director. The Appellate Division again refused them permission to appeal against this order.

The judge who made these orders in the High Court soon afterwards leap-frogged dozens of judges of the High Court Division to be elevated to be a judge of the Appellate Division.

The Government has since then taken steps for which it owes the people of Bangladesh proper explanations.

It has established a '"Commission of Enquiry" to enquire into Grameen Bank and its associated companies. We should ask the government to explain the basis for establishing such a Commission and to show us the materials based on which it took this decision. As citizens we have a right to this information and we must insist on this as a right to information under the law.

While this Commission is ongoing, and before it has finalised it report, the government has taken another sudden action to push through and obtain cabinet approval to amend the Grameen Bank law. This has been done to change the provisions of the law regarding appointment of its Board and the powers of the chairman. The main purpose of this appears to be to over-rule the 9 women Board Members who have repeatedly insisted in Board meetings that Prof. Yunus has to be part of any search committee to look for his successor. The cabinet has also reportedly discussed taking action to make Prof. Yunus account for funds received from Grameen Bank after he had reached retirement age. These are attempts to damage his reputation and are in the nature of defamatory innuendos.

We need to ask why such a sustained attack is being made on Grameen Bank institutionally and Prof. Yunus personally? Why is it a priority for the government to damage Professor Yunus' reputation and to affect the proper, democratic functioning of the Grameen Bank by curtailing the rights of the shareholders and their elected directors.

We need these answers precisely because the government has given single-minded priority to target Prof. Yunus and the Grameen Bank while major enquiries which have been demanded and which the government is obliged to initiate are going unanswered. These include inquiries regarding the share market scam, the allegations of corruption arising from the current prosecution of railway ministry officials and serious allegations of corruption relating to other projects, including Padma Bridge. Citizens should raise our voices to say that attempts to damage the Grameen Bank and the reputation of its founder can only damage the country itself and deprive us of our right to uphold our national image, and protect our national assets.

I hope that Members of Parliament will not remain as silent onlookers as the executive branch acts grossly arbitrarily. They cannot allow a matter of national importance to be dealt with summarily by an Ordinance. Parliament must be given an opportunity to debate this matter and a Parliamentary Committee should hold a public hearing regarding the need for the proposed amendments. This would reveal that it is against the public interest to restrict the powers of elected Board Members to appoint a managing director and to impose political and bureaucratic control over Grameen Bank.

The writer is an eminent Jurist and one of the framers of our Constitution.

(This is the full text of the statement made yesterday (Aug 4) by Dr. Kamal Hossain.)


Dr. Mirza Azizul Islam and Dr. Hossain Zillur Rahman give their reactions to The Daily Star on the proposed amendment to the Grameen Bank Ordinance 1983.

Dr. Hossain Zillur Rahman

The amendment to the Grameen Bank Ordinance 1983 is essentially a step against principals of economic democracy because the voice of owners of the bank, who are mainly the beneficiaries, is being disenfranchised, and government's hand is being strengthened totally. What we find is that it is happening at a time when government's own banks are facing enormous reputation crisis because of the very same problem that government's partisan control of the governance structure of the banks has made a major crisis in the public banking sector. Therefore, this proposed step does not give any confidence. For any viable institution, operational and policy independence is a criteria for success. Arbitrary oversight by the government, particularly where political partisanship is such a big problem, is not conducive to good institution building. So it goes against economic democracy as well as a bad precedence of good governance.

Again investigation into salaries and benefits that Prof Yunus received during his tenure as the bank's managing director past the retirement age is a persistent example of harassing attitude. Essentially, it has nothing to do with good governance. It is essentially another chapter of harassment the government has been continuing for a long time.

It is confirming that the government is not pursuing a principled agenda in the case of Dr.Yunus and Grameen Bank. It is very much motivated by agenda of harassment and control. It is a sad story not only globally but also within the country. Let's forget the global, within the country people are not seeing the mind set of control as a good example.

Dr. Hossain Zillur Rahman is Executive Chairman, Power and Participation

Research Centre.


Dr. Mirza Azizul Islam

First thing is that I do not see any necessity of this government decision. The second thing, what I have seen in the media reports it seems that the chairman is vested with the actual power to appoint the managing director.

Now, there are two things. The first thing is that appointment authority is being taken away from the board, who are the representatives of the shareholders and clients, and they are almost same. The power of appointing the managing director is being taken away from these major stakeholders, and this is not acceptable in principle.

Another factor that makes me seriously concerned that since the chairman will be appointed by the government and he will appoint the managing director so appointment of the chairman may be politicised and so the appointment of the managing director.

Politicisation will not help bear not any good for Grameen Bank. Hence, Grameen Bank should be kept above any sort of political interest. As we have seen that pollicisation has seriously affecting our public banks.

In the case of government's investigation into the salaries and benefits that Dr. Yunus received during his tenure as the bank's managing director past the retirement age of 60, government can handle the issue legally, but, previously, Bangladesh Bank raised an objection with this matter, and after getting clarification from Grameen Bank they did not pursue this matter. The government is playing with the age factor, but the board of Grameen Bank exempted the age limit. Now, another question may arise about whether the board was empowered to do it, and that can be legally evaluated. But my point is even if this had happened Bangladesh Bank did not raise any further objections when they did audits afterwards. Finally, assuming that it was illegal, but it is a matter of reality that he enjoyed the facilities as per the rule of Grameen Bank. Usually, when such situation arises, it is solved by giving post-facto approval. This could have been done in this case, instead of trying to prove whether it is legal or illegal and especially when he is not working as a managing director anymore. So, I do not think there is any valid point of bringing up what happened in the past.

Dr. Mirza Azizul Islam is a former adviser to a caretaker goverment.

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If someone thinks that justice will be served in Bangladesh legal system, heshe is living in fool's paradise, because it's absolutely politicalized. Yunus and Grammen Bank bashing emanates from personal vandetta of one person, not contravention of rule of law whatsoever. My gut feeling is that this govt. will destroy this Bank and will change it's name eventually. Ultimately, poors of Bangladesh will be the sufferer.

: T.Raiden

The country is thankful to the three eminent Bangladeshis to come out in support for 8.5 million poor Grameen members most of whom are women to run their business without government interference. I think intellectuals, politicians & general public should come out with forceful voice against this madness. The suggestion that Grameen member-directors are illiterate & as such don't have the ability to take decisions for running the bank.

: Nazrul M Islam

Comments

  • Truth Teller
    Sunday, August 5, 2012 02:18 AM GMT+06:00 (103 weeks ago)

    Dr. Kamal Hossain has said it all. Thank you, Dr. Hossain, for telling the facts to the people of Bangladesh. I hope they will remember all these during the next general election.


 

 


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