Non-brokers’ shortlist sparks row at PSE

The five-member Nominations and Elections Committee (Nomelec) of the Philippine Stock Exchange (PSE) has shortlisted the candidates for the non-broker seats in the 15-man board of directors, in the process sparking anew the rift between the two factions within the brokers’ circle.

In a meeting last Tuesday, the Nomelec issued a final list of candidates for both broker and non-broker seats, keeping the entire brokers list intact but trimming the non-brokers almost by half. Of the 25 total nominees for non-brokers, only 14 were allowed to run in the annual PSE elections set on April 5.

Of the 15 board seats, eight are reserved for non-brokers, as mandated by the Securities Regulation Code. The eight non-brokers, will represent the interests of issuers or the listed companies, investors, other market participants, and the independents. Based on the Nomelec guidelines, four are independent directors including the exchange president; two from the issuers; and a representative each from investors and other market participants.

The Nomelec, chaired by Jose Aquino, director of the Markets Regulation Department of the Securities and Exchange Commission (SEC), shortlisted the independents to only four candidates, all incumbent directors led by PSE president Ernest Leung, virtually enabling them to retain their posts. Aside from Leung, the other independent directors that have been appointed back to the board are former Customs Commissioner Tomas Apacible, Ateneo’s Fr. Joaquin Bernas and former Socio-Economic Planning Secretary Cayetano Paderanga.

Aquino explained that the appointment of independent directors is a requirement under the new Corporate Governance Code by the SEC, hence exempts them from the voting process.

The list of independents originally contains a total of 13 candidates, including former PSE president Ramon Garcia and former SEC Chairman Rosario Lopez, both of whom were not allowed to run. Interestingly, most of the disqualified and excluded candidates were nominees of the group led by PSE director Robert Coyiuto Jr., the main opponent of incumbent PSE chairperson Vivian Yuchengco who leads the other bloc in the PSE board.

Both Yuchengco and Coyiuto were prevailed upon by no less than President Arroyo to defer their candidacy for this year’s elections to resolve the internal conflict that has hampered the pace of work at the PSE.

But not surprisingly, the candidates this year have been, in one way or the other, affiliated with either the Coyiuto group or the Yuchengco camp.

In the meantime, the candidates to represent the issuers are incumbent PSE director Enrique Aboitiz (Aboitiz Equity/WG&A); Ramon Ang (San Miguel Corp.); Jose Ibazeta (ICTSI) and Federico Lopez (Benpres Holdings/ABS-CBN).

Vicente Ayllon of Insular Life and Vicente Lazatin will contest the investors’ group; while Roman Azanza, Eduardo Francisco, Francis Lim and Guillermo Luz will battle for the sole spot for other market participants.

Expected to battle it out for the chairmanship of the PSE are big brokers Filomeno Francisco of AB Capital Securities and last year’s top vote-getter Alicia Arroyo of RCBC Securities.

Francisco leads the brokers’ team with four re-electionists (Eddie Gobing, Edwin Luy, Federico Lim and Harry Liu), former PSE governors Paulino Soo and Joseph Roxas, and first-timer Gregorio Chan.

On Arroyo’s side, are Rodolfo Cruz, William Ang, Gregorio Kilayko, Marita Limlingan, Myron Timothy Papa, and Joseph Madrid.

Francisco’s group is allied with Coyiuto while Arroyo’s team is on the side of Yuchengco.