MANILA, Philippines — The Philippines has joined Indonesia,
Malaysia, Singapore, Thailand, and Vietnam in adopting of the ASEAN Corporate
Governance Scorecard through the Institute of Corporate Directors (ICD).
“We feel that now is the time for
the Philippines to stop playing at the PBA and join the Asian Games of
corporate governance. Hopefully, in the next five to seven years, we can join
the Olympics of corporate governance. This is what it is all about today,” said
ICD president Rex Drilon.
The ASEAN CG Scorecard is part of
the ASEAN Corporate Governance Initiative of the ASEAN Capital Markets Forum
and is funded by the Asian Development Bank (ADB).
The objective of the Scorecard is
to rank ASEAN publicly-listed companies (PLCs), raise corporate governance
standards and practices of ASEAN PLCs, and showcase and enhance the visibility
as well as the “investability” of the ASEAN PLCs.
The ASEAN CG Scorecard shall
supersede the national CG Scorecard for PLCs that ICD has been implementing for
the past 7 years.
This means that PLCs’ governance
practices will now have to be screened by more than 190 questions compared to
ICD’s old scorecard of 110 questions.
The ASEAN CG Scorecard also has
two levels. Bonus points will be added to the PLCs who have applied best
practices or practices that go beyond compliance.
The second level has penalty
points as well and these will be applied on PLCs, which demonstrate poor
governance. The second level of the
ASEAN CG Scorecard shows its strong emphasis on companies doing good governance
beyond compliance, which has been ICD’s long-standing advocacy among Philippine
PLCs.
There are still similarities to
the old CG Scorecard. The ASEAN CG
Scorecard still adopts the OECD Principles of Corporate Governance including
rights of shareholders, equitable treatment of shareholders, role of
stakeholders, disclosure and transparency, and responsibilities of the board of
directors.
The ICD began participating in
the ASEAN Corporate Governance Initiative when its Chairman, Dr. Jesus P.
Estanislao FICD was nominated by the Philippine SEC to the ASEAN Corporate
Governance Group of Experts.
The ICD, an institute composed of
its Fellows, has been at the forefront of Philippine corporate governance
reforms for the past 12 years.
JAMES A. LOYOLA
Business & Investment Opportunities
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