A growing trend has emerged in Nepal’s capital market where directors and senior executives of listed companies are reportedly resigning from their positions to eventually gain the right to sell their shares.

Under existing regulations, directors, senior management officials, and insiders with access to material information are prohibited from selling company shares while in office and for one year after leaving their positions. Taking advantage of this provision, some company officials are said to be stepping down in advance so they can legally dispose of their holdings after the mandatory waiting period.

According to officials familiar with the matter, several directors have recently resigned in a planned manner, particularly from companies that have already gone public. Their long-term objective is believed to be exiting their investments through future share sales.

While such practices were previously more common among hydropower companies, market experts say the trend is now spreading to firms in the investment, manufacturing, processing, tourism, trading, and other sectors.

Stakeholders argue that although the practice may comply with current regulations, it raises concerns about corporate governance, transparency, and investor confidence. As a result, calls are growing for regulators to closely monitor the trend and assess whether additional safeguards are needed to protect the integrity of Nepal’s capital market.