As one of four independent directors representing the non-brokers in the board, Bernas challenged the legal basis for his appointment.
But Securities and Exchange Commission Markets Regulation Department head Jose P. Aquino, PSE Nominations and Election Committee (Nomelec) chairman, stood his ground on the shortlisting process.
Bernas raised the issue on the Securities and Exchange Commission (SEC)memorandum circular 16 dated November last year which set the guidelines for the nomination and election of independent directors for publicly listed companies, financing companies, investment houses and stock exchanges, among others.
The circular required the PSE board to have at least three independent directors and an independent director-president. In case of disputes among shareholders over who should be appointed as independent directors, the circular allows the PSE’s Nominations and Elections Committee (Nomelec) to recommend the candidates for available board seats.
PSE director Harry Liu said it was not clear if the PSE board would merely note or approve the list of candidates for the upcoming PSE elections on April 5, as the board meeting yesterday failed to resolve the issue raised by Bernas since the SEC-designated Nomelec chairman Jose Aquino failed to attend the meeting.
The five-member Nomelec earlier shortlisted the field of candidates for the non-broker seats in the 15-man board of directors, provoking another rift between the two rival factions in the PSE – the Robert Coyiuto Jr. and the Vivian Yuchengco groups.
In its meeting last Tuesday, the Nomelec finalized the list of candidates for both the 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.
Out of the 15 board seats, a majority of eight is reserved for non-brokers, as mandated by the Securities Regulation Code. The eight non-brokers, in turn, 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 independents have been shortlisted 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, former Socioeconomic Planning Secretary Cayetano Paderanga, and Bernas. – Conrado Diaz Jr.