I am reproducing underneath edited excerpts of SEC Chairman Emilio B. Aquino’s short presentation as panelist at the anti-corruption and integrity pointers for country-owned organizations (SOEs) during the latest twelfth Meeting of the Asia Network on Corporate Governance of State-owned Enterprises, headed by means of the Governance Commission for Government-Owned or Controlled Corporations (GOCCs), on behalf of the Organization for Economic Cooperation and Development (OECD) and in coordination with the Asian Development Bank (ADB).
I also attended the meeting together with other representatives of governments, country-ownership entities, international organizations, company practitioners and industry experts. It became with such honor and privilege for us to were on this unique occasion wherein I turned into capable of examine more about the neighborhood and global stories in SOE governance reform.
For context, but, we first ask: “What do the OECD recommendations on corporate governance of SOEs provide?” The OECD’s official website provides for the features of these pointers: “The OECD Guidelines offer an the world over agreed benchmark to assist governments examine and enhance the way they exercise their possession functions in kingdom-owned companies. Good corporate governance of country-owned organisations is a key reform precedence in many countries consequently, stepped forward efficiency and better transparency inside the country owned area will result in great financial profits plus a sound and competitive commercial enterprise area, specifically in international locations where nation possession is crucial.”
Chairman Aquino’s presentation touched on the Securities and Exchange Commission’s (SEC) mandate as an anti-money laundering and counter-terrorist financing enforcer and company governance champion. I hope you may permit me to apply this column to tricky.
Preventing cash laundering, different corrupt practices in SOEs
Chairman Aquino mentioned SEC Memorandum Circular 15 series of 2018 or the tips for the protection of SEC-registered non-income companies from cash laundering and terrorist financing abuse (NPO Guidelines).
The round turned into followed by using the commission to decorate its registration and monitoring gadget to reap the important statistics on NPOs with regards to Anti-Money Laundering/Combating the sharefounders review Financing of Terrorism (AMLCFT) for regulatory and danger assessment purposes, and to provide extra measures to the pertinent legal guidelines administered via SEC.
Section 2.2 of the NPO Guidelines presents that the hazard-based totally method for the safety of NPOs shall encompass the following: 1) Identifying threats of terrorist financing abuse based totally on the results of the national chance assessment of the Anti-Money Laundering Council; 2) Identifying vulnerabilities amongst NPOs based totally at the types and function capabilities of such NPOs; and 3) Identifying the results of such threats and vulnerabilities on NPOs.
Corporate governance in Revised Corporation Code
The commission’s push for suitable corporate governance is anchored on and strengthened by Republic Act 11232, or the Revised Corporation Code of the Philippines (RCC).
Section 179 of the RCC affords for the powers, capabilities and jurisdiction of the SEC, one among which is to promote proper governance and the safety of minority traders, thru, among others, the issuance of regulations and rules consistent with worldwide fine practices.
In line with top corporate governance, Section 22 of the RCC also gives that businesses engaged in organizations vested with public interest, as can be decided by using the commission, shall have unbiased directors constituting as a minimum 20 percent in their respective forums: 1) Publicly listed Stock Global forex broker) Banks and quasi-banks, NSSLAs (non-inventory financial savings and mortgage associations), pawnshops, companies engaged in money provider business, pre-want, believe and coverage companies, and different monetary intermediaries; and 3) Other agencies engaged in business vested with public hobby much like the above, as can be decided through the fee.
Are GOCCs corporations vested with public hobby?
On the problem of impartial contributors of the GOCCs, the OECD hints on anti-corruption and integrity in SOEs nation: “Many governments consist of ‘unbiased’ contributors inside the forums of SOEs, but the scope and definition of independence vary significantly in line with national felony context and codes of corporate governance. Broadly speaking, an unbiased board member is taken to mean impartial from each the company (non-government board member) and from the state (neither civil servant, public reliable nor elected legitimate). Independent board individuals, where applicable, are understood to mean people free of any cloth hobbies or relationships with the employer, its management, other primary shareholders and the possession entity that could jeopardize their exercising of objective judgment.”
In addition, Atty. Cesar L. Villanueva, former dean of the Ateneo Law School, said that the GOCC Governance Act recognizes that every one GOCCs, whether or not chartered or non-chartered, are imbued with “public hobby” because it broadcasts the State policy beneath Section 2 thereof: “The State acknowledges the ability of [GOCCs] as full-size gear for financial improvement. It is hence the policy of the State to actively exercising its possession rights in GOCCs and to promote boom via making sure that operations regular with national development regulations and programs.”
In that light, the query of whether or not a GOCC, a business enterprise vested with public interest, must employ independent members stays an unanswered query to be tackled by using the SEC and prison professionals.
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