SEC seeks public input on corporate governance

MANILA, Philippines - The Securities and Exchange Commission (SEC) is seeking stakeholders’ insights in line with efforts to improve the corporate governance scores of Philippine publicly listed companies (PLCs).

In a public notice, the corporate regulator said it is requesting the public’s inputs to ensure the next Association of Southeast Asian Nations (ASEAN) Corporate Governance Scorecard Country Report and Assessment will accurately reflect the level of corporate governance of Philippine PLCs.

“The SEC is committed to make Philippine PLCs more competitive in the field of good corporate governance in time for Philippine Stock Exchange (PSE) joining the ASEAN trading link,” the agency said. SEC said good corporate governance is essential in developing capital markets by increasing share value while protecting investors. Corporate governance principles provide guidance on how corporations should operate.

“It is the key to eliminating unethical and illegal conduct among companies and stakeholders,” SEC said.

For its part, the corporate watchdog is collecting comments from the private sector, which might propose steps and measures that could be conducted by companies to secure high ranking and scores. The companies are also encouraged to make known issues and concerns that might adversely impact the ability of PLCs to achieve high scores. The SEC scheduled a public consultation on July 28.

Corporate governance experts within the region have banded together under the ASEAN Capital Market Forum and Asian Development Bank (ADB) to assess the level of corporate governance of each of the top 100 PLCs in each jurisdiction. The PLCs were ranked through the use of the ASEAN Corporate Governance Scorecard and the peer review process.

The scorecard provides a rigorous methodology benchmarked against international best practice to assess the corporate governance performance of publicly listed companies in the participating ASEAN member countries.

But “results of the past two year scorecard and review showed (Philippine PLCs) lagging behind PLCs from Singapore, Thailand and Malaysia,” SEC said.

Listed companies in the Philippines recorded higher ratings in terms of corporate governance and investor protection efforts last year, a development that will help attract more investors in the country.

In the ASEAN Corporate Governance Scorecard’s country reports and assessments 2013-2014, the median score of 252 firms listed in the PSE improved to 58 last year from 48.91 in 2012.