MANILA, Philippines – The Philippines ranks second best among countries belonging to the Association of Southeast Asian Nations (Asean) when it comes to good corporate governance, with companies owned by some of the country’s richest families leading the pack.
A total of 11 Philippine publicly listed firms made it to the region’s top 50 companies practicing good governance as graded by the Asean Capital Markets Forum (ACMF).
Thailand had the most number of listed firms that made it to the top 50 with 23. The Philippines, which was second with 11, was followed by Singapore with eight, Malaysia with six, and Indonesia with two.
Among the 11 Philippine corporations that made it to the top 50, four are owned by the Ayala group. These firms were Ayala Corp., Ayala Land Inc., Globe Telecom Inc., and Manila Water Co.
The Manuel Pangilinan-led group had the second highest number of companies practicing good governance with three, namely Manila Electric Co., Philex Mining Corp., and Philippine Long Distance Telephone Co.
The other firms that were part of the list were Aboitiz Equity Ventures of the Aboitiz clan, George Ty’s GT Capital Holdings, Inc. and the Sy family’s SM Prime Holdings and BDO Unibank Inc.
Although it was not included in the top 50, Asia United Bank was also recognized as the most improved company in the region.
“Out of the 50, 11 Philippine listed companies are included so that’s a good showing as far as we’re concerned. The Securities and Exchange Commission (SEC) has been trying to initiate more measures to really encourage these Philippine firms to see to it that they do practice good corporate governance that are comparable within the region or even globally. We know that it is only by being a good corporate citizen that you can compete regionally and globally,” SEC director Justina Callangan said.
The companies that made it to the top 50 were graded based on specifications that include rights of shareholders, equitable treatment, role of stakeholders, disclosure and transparency, board responsibilities, and bonuses and penalties.
“Of these specifications, we need to do more work on board responsibilities and then we also have to do a lot of work on how we deal with our stakeholders. We’re more or less okay on dealing with shareholders, but the moment you go to stakeholders, we have to do much more,” Institute for Solidarity in Asia chairman Jesus Estanislao said.
Despite the already positive results, Callangan said the SEC would continue to promote good corporate governance practices among companies and ensure that Philippine listed firms practice them.
“We won’t stop here. If you look at the corporate governance blueprint for the Philippines, this is going to be the roadmap for the Philippines for the next five years. We will now start on the revisitation of the revised Code of Corporate Governance. And we are also working on the amendment of the corporation Code of the Philippines because we need to have corporate governance principles and practices embedded in our legislation,” Callangan said.
The top 50 companies were awarded during the inaugural ASEAN Corporate Governance Conference and Awards last Saturday night. The awards is seen to recognize the efforts of companies that continuously implement good corporate governance in their operations and services.
“We want to see that competitiveness across countries. You’re not only competing to be the best in the Philippines but your competing to be the best in Asean. And that spirit of trying to outdo each other or being in the top 50 will lead to the sustainability of companies to keep on improving,” Asian Development Bank financial sector economist Mohd Sani Mohd Ismail said.
The ACMF is composed of capital market regulators from 10 Asean jurisdictions namely Brunei, Cambodia, Indonesia, Laos PDR, Myanmar, Philippines, Singapore, Thailand, and Vietnam. –Richmond S. Mercurio (The Philippine Star)