CROYDON, England — As shopkeeper Ben Selvaratnam recounted how his grocery store in south London was being targeted by shoplifters up to 10 times a day, he had to stop to eject two men who had brazenly slipped two bottles of premium beer into their carrier bag.
The incident, on a Tuesday morning, was unremarkable at his Freshfields Market convenience store following a “massive increase” in theft and violence that he and other shop owners put down to a lack of response from authorities to retail crime.
Repeat offenders and criminal gangs operating with apparent impunity is becoming a hot political topic ahead of a national election expected next year. Critics of Prime Minister Rishi Sunak’s government say it shows a breakdown in society.
“We stopped reporting incidents to the police because we just felt, for whatever reason, budget cuts or whatnot, they weren’t as responsive as we needed them to be,” Mr. Selvaratnam told Reuters in his shop in Croydon, where his butcher doubles up as a security guard.
It’s a similar story in Glasgow, Scotland, where Girish Jeeva was recently left bloodied after being punched in the face when he challenged a man stealing from his grocery store in the Barmulloch district.
Both Mr. Selvaratnam and Mr. Jeeva are frustrated that shoplifters who steal goods worth less than 200 pounds are rarely prosecuted.
“That explains why some of these gangs, especially the teenagers, they don’t even run when they rob the place,” said Mr. Selvaratnam.
The issue of theft and violence has been raised by many of Britain’s biggest retailers in recent months, including Tesco, John Lewis and Primark, echoing similar reports in the United States and elsewhere.
The two British shopkeepers said the main protagonists were local organized criminal gangs, often hooded and masked and sometimes carrying weapons like machetes, who target higher-value products like alcohol, boxed chocolates and meat.
But they have also seen an increase in mums hiding goods in prams and pensioners stealing tinned meat and fish as an increase in the cost of living hits many households.
Mr. Jeeva in Scotland said the police did not take action even when he provided clear CCTV evidence of offenses and told them where the perpetrator lived.
“It’s a waste of time,” he said.
NO-GO AREAS A Freedom of Information request by British retailer the Co-op showed the police did not respond to 71% of serious retail crimes reported.
In the six months to June 2023, it recorded almost 1,000 incidents a day of shoplifting and anti-social behavior, a 35% increase year-on-year. It has warned that some local stores risk becoming no-go areas.
The British Retail Consortium lobby group said the industry was losing almost 1 billion pounds ($1.2 billion) a year from theft, despite an industry spend on crime prevention of 700 million pounds in 2021/22.
Mr. Selvaratnam installed reinforced glass and steel barriers in the till area of his shop this year.
Thefts are an increasing problem for Mr. Sunak, whose Conservative Party, lagging in polls after 13 years in power, has traditionally portrayed itself as strong on law and order.
A YouGov poll found 74% of British adults believe the government has badly handled crime, and 22% see it as one of the three most important issues facing the country.
Policing minister Chris Philp recently asked forces to take a zero-tolerance approach to shoplifting, including thefts below 200 pounds.
But London’s police force, the country’s biggest, said that was not realistic.
“Where a crime is being committed, a suspect is on the scene, and the situation has or is likely to become heated or violent, our call handlers will assess this and seek to dispatch officers where appropriate,” it said.
ASSAULT The opposition Labour Party has said if it wins power it will change the law to ensure all thefts are investigated. It will ban repeat offenders from town centers, restore neighborhood policing and create a new specific offense of assault against retail workers.
But Mr. Selvaratnam is not optimistic. As well as a new approach to policing he believes the government needs to address economic hardship, social services and ways to strengthen community ties.
In the eight years he’s owned the shop he has been regularly spat at, and physically assaulted over 20 times. He has been slashed with broken bottles four times and the top part of his ear had to be reattached after it was bitten off.
“It’s out of control,” he told Reuters.
He tried to sell the business, but potential buyers pulled out when their due diligence revealed the extent of losses from theft.
More spending by the biggest retailers on their theft defenses will simply divert crime, Mr. Selvaratnam fears.
“For the small independents like ourselves, we’re just going to get it even more,” he said. — Reuters
SEONGNAM, South Korea – South Korea’s Hanwha Ocean has pitched offers to build submarines to Canada, the Philippines and Poland, a company official said on Wednesday, as the country pushes to become one of the world’s top four defense exporters.
Canada is studying potential builders for new submarines and has expressed interest in Hanwha Ocean among other foreign rivals, Kim Seung-min, leader of Hanwha Ocean’s naval and special ship overseas marketing team, told Reuters in an interview, without naming the competitors.
“We are now checking on our shoelaces at the start line before the race kicks off,” Kim said on the sidelines of the country’s biggest defense show, Seoul International Aerospace and Defense Exhibition (ADEX).
South Korea’s President Yoon Suk Yeol has pledged to step up efforts to boost weapons exports and secure cutting-edge defense technologies as he aims to build the industry into one of the world’s four largest exporters.
Currently, the top four arms exporters are the United States, Russia, France and China, according to the Stockholm International Peace Research Institute think tank.
Hanwha Ocean, formerly known as Daewoo Shipbuilding & Marine Engineering, is a leading South Korean defense contractor that has built submarines for the South Korean and Indonesian navies.
Kim said Hanwha Ocean had responded this year to questions from Poland on its submarine building capabilities, after registering interest in the European country’s tender to build about three submarines.
Last year, South Korea inked a $13.7 billion arms deal with Poland – Seoul’s biggest ever – laying the groundwork for a major military-industrial business.
Hanwha Ocean is also vying to sell diesel-powered submarines to the Philippines, which is looking to acquire two submarines over the 2,000-tonne level, Kim said.
Tensions are rising between the Philippines and China over the South China Sea. The Philippines currently has no submarine fleet.
Kim said the company had proposed supplying the Philippines with submarines with lithium-ion batteries, which allow the subs to stay underwater much longer than those with lead acid batteries – an advantage over French and Spanish submarines. — Reuters
India will allow exports of non-basmati white rice to the Philippines, Nepal, Cameroon, Malaysia, Seychelles, Ivory Coast, and the Republic of Guinea, a government notification showed on Wednesday.
India in July banned exports of non-basmati white rice and later imposed a 20% duty on exports of parboiled rice. — Reuters
President Ferdinand R. Marcos, Jr. answers questions from the media after his first Cabinet meeting at the Heroes Hall of the Malacañan Palace, July 5. — PHILIPPINE STAR/KRIZ JOHN ROSALES
MANILA – Philippine President Ferdinand Marcos Jr has suspended the implementation of a controversial sovereign wealth fund that he fought to bring to fruition, citing the need to make it foolproof.
His executive secretary said in an Oct. 12 memo there was a need to study the fund’s implementing rules and regulation, which were already in effect, to ensure that safeguards were in place for “transparency and accountability.”
The factors cited for the suspension were the very same reasons that critics of the fund have cited when they opposed it, which were met by repeated assurances from its backers, including Mr. Marcos, the fund would be managed with prudence.
It was not clear from the memo for how long the rules would remain suspended.
Opposition lawmaker France Castro said on Wednesday the suspension of the fund’s implementation showed the measure was “rushed and flawed in so many levels.”
“It would be better if President Marcos Jr. just scrapped the whole Maharlika law rather than just suspend it,” Mr. Castro said in a statement. “We don’t have excess fund for this.”
The government has envisaged the fund would issue a total of P500 billion ($8.81 billion) worth of preferred and common shares which the national government, state-run firms and banks can purchase.
A shortlist of candidates for the board of directors to help manage the fund was submitted to Mr. Marcos this month.
Mr. Marcos, in signing the bill creating the fund in July, touted it as a key plank of his economic goals to modernise infrastructure and accelerate the country’s growth.
It followed moves by neighbours Malaysia and Singapore and more recently Indonesia in establishing sovereign wealth funds, albeit with mixed results.
In Malaysia, a multi-billion dollar graft scandal engulfed the 1Malaysia Development Berhad (1MDB) fund, causing widespread political repercussions. — Reuters
RUSSIAN PRESIDENT VLADIMIR PUTIN — KREMLIN.RU-COMMONS.WIKIMEDIA.ORG
BEIJING – President Vladimir Putin on Wednesday praised Chinese President Xi Jinping for the Belt and Road Initiative (BRI) and invited global investment in the Northern Sea route which he said could deepen trade between east and west.
Speaking on his second known trip outside the former Soviet Union since the Ukraine war, Putin thanked the Chinese leader for his invitation and said Russia could play a key role in China’s modern day revival of the ancient Silk Road.
Mr. Putin called Mr. Xi his “dear friend” and heaped praise on the Belt and Road Initiative for bringing the world together.
Shortly before Mr. Putin starting speaking, a handful of European delegates, including former French Prime Minister Jean-Pierre Raffarin, walked out of the room, a Reuters witness said.
“Russia and China, like most countries of the world, share the desire for equal, mutually beneficial cooperation in order to achieve universal sustainable and long-term economic progress and social well-being, while respecting the diversity of civilization and the right of each State to its own development model,” Mr. Putin said.
Mr. Putin said the BRI fitted with Russia which he said was developing a host of transport infrastructure to criss-cross the world’s biggest country, notably from the Northern Sea Route which runs from Murmansk near Russia’s border with Norway eastwards to the Bering Strait near Alaska
“As for the Northern Sea Route, Russia does not just offer its partners to actively use its transit potential, I will say more: we invite interested states to participate directly in its development, and we are ready to provide reliable ice breaker navigation, communication and supply,” Mr. Putin said.
“Starting next year, navigation for ice-class cargo ships along the entire length of the Northern Sea Route will become year-round.”
Mr. Putin, who has attended previous BRI summits, brought a senior delegation from Moscow.
Among the senior Russian officials were Foreign Minister Sergei Lavrov, who is due to visit North Korea shortly, Deputy Prime Minister Alexander Novak, his top oil and gas point man, and Deputy Prime Minister Dmitry Chernyshenko.
Also included were Kremlin spokesman Dmitry Peskov, Kremlin economic aide Maxim Oreshkin, Kremlin foreign policy aide Yuri Ushakov, Economy Minister Maxim Reshetnikov and Igor Morgulov, Russia’s ambassador to China. – Reuters
A GENERAL VIEW shows Beijing’s skyline on a sunny day in this file photo. — REUTERS
BEIJING – China’s economy grew at a faster-than-expected clip in the third quarter, while consumption and industrial activity in September also surprised on the upside, suggesting the recent flurry of policy measures is helping to bolster a tentative recovery.
Rapidly weakening growth in the world’s second-biggest economy since the second quarter prompted authorities to roll out support steps over the past weeks, and Wednesday’s batch of data indicated the stimulus is starting to gain traction although a property crisis and other headwinds pose risks to the outlook.
Gross domestic product (GDP) grew 4.9% in July-September from the year earlier, data released by the National Bureau of Statistics showed, versus analysts’ expectations in a Reuters poll for a 4.4% increase but slower than the 6.3% expansion in the second quarter.
On a quarter-by-quarter basis, GDP grew 1.3% in the third quarter, accelerating from a revised 0.5% in the second quarter and above the forecast for growth of 1.0%.
“It seems that all of that stimulus is finally beginning to take effect, with a broad beat from growth, retail sales, industrial production and unemployment,” said Matt Simpson, senior market analyst at City Index in Brisbane.
The economy faltered in the second quarter after a brief post-COVID recovery, dragged by a property downturn and huge debt due to a decades-long infrastructure binge.
Beijing has in recent weeks unveiled a raft of measures, including more public works spending, interest rate cuts, property easing and efforts to shore up the private sector.
The recovery momentum suggests the government’s full year 2023 growth target of around 5.0% is likely to be achieved.
“The improvement in Q3 economic data makes it less likely for the government to launch stimulus in Q4, as the growth target of 5% is set to be achieved,” said Zhiwei Zhang, chief economist at Pinpoint Asset Management.
“The focus of the government and the market will shift to the growth outlook for next year. The key issue is what growth target the government will set and how much fiscal easing will take place.”
Industrial output in September grew a stronger than expected 4.5% from a year earlier, but the pace was unchanged from August, according to the data. Analysts had expected a 4.3% increase.
Growth of retail sales, a gauge of consumption, also beat expectations, rising 5.5% last month, and accelerating from a 4.6% increase in August. Analysts had expected retail sales to expand 4.9%.
Fixed asset investment grew 3.1% in the first nine months of 2023 from the same period a year earlier, versus expectations for a 3.2% rise. It expanded 3.2% in the January-August period.
Property investment in the first nine months of 2023 fell by 9.1% from a year earlier, after slumping 8.8% in January-August, the data showed. – Reuters
SYDNEY – Fiji and Australia will cooperate on cyber security, with Australia also boosting aid to its Pacific Islands neighbor under an enhanced partnership, Australian Prime Minister Anthony Albanese said after meeting his Fijian counterpart on Wednesday.
Fiji Prime Minister Sitiveni Rabuka, on his first three-day official visit to Australia since becoming leader in December, said the relationship with Australia was warm.
Under Rabuka’s government, Fiji has put a decade-old policing agreement with China on hold, and sought to increase defence ties with Australia.
“We are more comfortable dealing with traditional friends. We have similar systems of government, our democracies are the same brand of democracy,” Mr. Rabuka told reporters in Canberra.
Fiji wanted the Pacific to be a “zone of peace”, he added.
In a speech on Tuesday evening to the Lowy Institute, Mr. Rabuka noted rivalry between the United States and China was intensifying, and the Pacific Islands countries, which span more than 30 million square kilometers (11.5 million square miles) of ocean, had a duty to carry the banner of peace.
“Pacific unity is central to the relationship in our region and Fiji plays a critical leadership role,” said Mr. Albanese.
Mr. Albanese said Australia had agreed to provide more budget support to Fiji “to help economic recovery and to boost growth”, and would sell it 14 Bushmaster protected vehicles to support the Fiji military’s peacekeeping operations around the world.
Fiji will also be included in a pilot of streamlined visa processing to make it easier for Fijians to travel to Australia. – Reuters
A view shows houses and buildings destroyed by Israeli strikes in Gaza City, Oct. 10, 2023. — REUTERS
GAZA – A Gaza health ministry spokesman said hundreds were killed in a blast at a Gaza City hospital on Tuesday that Israeli and Palestinian officials blamed on each other and that ignited protests in the West Bank and around the Middle East.
Health authorities in the Hamas-ruled Gaza Strip said an Israeli air strike caused the blast while Israel’s military attributed it to a failed rocket launch by the Palestinian Islamic Jihad militant group.
The health ministry spokesman, Ashraf Al-Qudra, said early on Wednesday that hundreds were killed and rescue workers were still removing bodies from the rubble. In the first hours after the blast, a Gaza civil defence chief said 300 people were killed, while health ministry sources put the figure at 500.
Reuters could not independently verify who was responsible for the blast or how many people were killed.
Before Tuesday’s blast, health authorities in Gaza said at least 3,000 people had died in Israel’s 11-day bombardment that began after a Hamas Oct. 7 rampage on southern Israeli communities in which 1,300 people were killed and around 200 were taken into Gaza as hostages.
Gaza, a 45 km-long (25-mile) enclave home to 2.3 million people, has been ruled since 2006 by Hamas, an Islamist group that is a U.S.-designated foreign terrorist organization.
The blast took place on the eve of a visit by U.S. President Joe Biden to Israel to show support for the country in its war with Hamas and to hear how Israel plans to minimize civilian casualties. One U.S. aim is to keep the conflict from spreading.
Regardless of who is found responsible for the explosion, which Hamas said had killed patients and others left homeless by Israeli bombardment, it will complicate efforts to contain the crisis.
In one sign of this, Jordan’s foreign minister, Ayman Safadi, cancelled a summit his country was to host in Amman with Biden and the Egyptian and Palestinian leaders.
In another, Palestinian security forces fired tear gas and stun grenades to disperse protesters in the occupied West Bank city of Ramallah who were throwing rocks and chanting against Palestinian President Mahmoud Abbas as popular anger boiled.
The blast drew condemnation across the Arab world, and protests were staged at Israel’s embassies in Turkey and Jordan and near the U.S. embassy in Lebanon, where security forces fired tear gas toward demonstrators.
Television footage showed protests in Yemen’s southwestern city of Taz, as well as in the Moroccan and Iraqi capitals.
Lebanon’s Iran-backed Hezbollah militant group denounced what it said was Israel’s deadly attack on the Al-Ahli al-Arabi hospital in Gaza, run by the Anglican church, and called for “a day of unprecedented anger” against Israel and Biden’s visit.
CLAIMS AND COUNTER CLAIMS
There were competing claims and denials from Israeli and Palestinian officials over who was responsible.
Abbas said that targeting the hospital was a “hideous war massacre,” adding that “Israel has crossed all red lines.”
Israeli Prime Minister Benjamin Netanyahu blamed Palestinian militants for the explosion.
“The entire world should know: It was barbaric terrorists in Gaza that attacked the hospital in Gaza, and not the IDF,” he said, referring to the Israel Defense Forces. “Those who brutally murdered our children also murder their own children.”
Briefing reporters early on Wednesday, Israeli military spokesperson Rear Admiral Daniel Hagari cast doubt on the Palestinian death count, asserted that there was no direct hit on the hospital, and said Israel had intelligence proving its claim that Gaza militants were responsible.
The IDF blamed Palestinian Islamic Jihad which, like Hamas, is viewed by the United States as a foreign terrorist organization.
“The IDF did not strike the hospital in Gaza,” Hagari said in a video statement. “The hospital was hit as a result of a failed rocket launched by the Islamic Jihad terrorist organization.”
Another IDF spokesman, Lieutenant Colonel Jonathan Conricus, told CNN Israel had intercepted conversations among militants showing “they understand that it was a rocket that misfired.”
He said the Israeli government would share its intelligence with Biden and would make the intercepts public.
Speaking earlier, Daoud Shehab, a spokesman for Islamic Jihad, denied his group was responsible.
“This is a lie and fabrication, it is completely incorrect. The occupation is trying to cover for the horrifying crime and massacre they committed against civilians,” he told Reuters.
Clashes with Palestinian security forces broke out in a number of other cities in the West Bank, which is ruled by Abbas’ Palestinian Authority, late on Tuesday, witnesses said.
After Hamas officials initially blamed Tuesday’s hospital blast on an Israeli air strike, Arab countries, Iran and Turkey swiftly condemned it. – Reuters
STANFORD, California – The Five Eyes countries’ intelligence chiefs came together on Tuesday to accuse China of intellectual property theft and using artificial intelligence for hacking and spying against the nations, in a rare joint statement by the allies.
The officials from the United States, Britain, Canada, Australia and New Zealand – known as the Five Eyes intelligence sharing network – made the comments following meetings with private companies in the US innovation hub Silicon Valley.
US FBI Director Christopher Wray said the “unprecedented” joint call was meant to confront the “unprecedented threat” China poses to innovation across the world.
From quantum technology and robotics to biotechnology and artificial intelligence, China was stealing secrets in various sectors, the officials said.
“China has long targeted businesses with a web of techniques all at once: cyber intrusions, human intelligence operations, seemingly innocuous corporate investments and transactions,” Mr. Wray said. “Every strand of that web had become more brazen, and more dangerous.”
In response, Chinese government spokesman Liu Pengyu said the country was committed to intellectual property protection.
“We firmly oppose to the groundless allegations and smears towards China and hope the relevant parties can view China’s development objectively and fairly,” the spokesperson for China’s embassy in Washington said in a statement to Reuters.
The US has long accused China of intellectual property theft and the issue has been a key sore point in US-China relations. But this is the first time the Five Eyes members have joined publicly to call out China on it.
“The Chinese government is engaged in the most sustained scaled and sophisticated theft of intellectual property and expertise in human history,” said Mike Burgess, the Australian Security Intelligence Organisation’s director-general.
While China’s intention to innovate for its own national interest was “fine and entirely appropriate”, Burgess said “the behaviour we’re talking about here goes well beyond traditional espionage.”
Last month, his department busted a Chinese plot to infiltrate a prestigious Australian research institution that involved planting an academic there to steal secrets, he said.
“This sort of thing is happening every day in Australia, as it is in the countries here,” Mr. Burgess said.
The Five Eyes statement follows the group’s warning in May of a widespread Chinese spy operation it said was targeting critical infrastructure and various other sectors.
Mr. Wray said China had “a bigger hacking program than that of every other major nation combined” that together with Beijing’s physical spies and stealing of trade secrets from private businesses and research institutions gave the country enormous power.
“Part of what makes it so challenging is all of those tools deployed in tandem, at a scale the likes of which we’ve never seen,” Mr. Wray said.
The officials called for private industry and academia to help in countering those threats, chief among which they said were artificial intelligence tools.
“We worry about AI as an amplifier for all sorts of misconduct,” Mr. Wray said, accusing China of stealing more personal and corporate data than any other nation by orders of magnitude.
“If you think about what AI can do to help leverage that data to take what’s already the largest hacking program in the world by a country mile, and make it that much more effective – that’s what we’re worried about,” he said. – Reuters
Board of trustees of the Institute of Corporate Directors and esteemed guests gather for a toast during the Golden Arrow awarding ceremony. — Photo from facebook.com/ICDPh
2023 Golden Arrow Recognition honors Philippines’ exemplary PLCs, insurers
By Chelsey Keith P. Ignacio, Special Features and Content Senior Writer
Instituting good corporate governance, which concerns practices to manage an organization and relations with its stakeholders, is valuable in establishing a company’s trust and reputation. Organizations with exemplary corporate governance were honored in the 2023 ACGS and CGS Golden Arrow Recognition, carried out by the Institute of Corporate Directors (ICD) at Okada Manila Hotel in Pasay City last Sept. 28.
Golden Arrow is awarded to publicly listed companies (PLCs) in the country with good corporate governance performance based on the 2022 ASEAN Corporate Governance Scorecard (ACGS) as well as to insurance firms based on Corporate Governance Scorecard (CGS) Assessment Results.
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ICD Founder and Chairman Emeritus Dr. Jesus P. Estanislao — Photo from facebook.com/ICDPh
ICD Founder and Chairman Emeritus Dr. Jesus P. Estanislao lead the toast during the ceremony. — Photo from facebook.com/ICDPh
SEC Commissioner Atty. Emilio B. Aquino — Photo from facebook.com/ICDPh
This year’s ACGS and CGS Golden Arrow Recognition was held at Okada Manila Hotel last Sept. 28. — Photo from facebook.com/ICDPh
More than a hundred recognitions were awarded in this year’s Golden Arrow Recognition. — Photo from facebook.com/ICDPh
Companies garnering at least 80 points in these assessments would receive recognition. A 5-arrow recognition would be given to companies that achieved a score of 120 to 130 points; a 4-arrow recognition for those with 110 to 119 points; a 3-arrow recognition for 100 to 109 points; a 2-arrow recognition for 90 to 99 points; and a 1-arrow recognition for companies that reached 80 to 89 points.
With the ACGS and CGS assessments, a firm’s corporate governance is examined on enabling the rights and equitable treatment of shareholders; its relation to various stakeholders; ensuring transparency and accountability by disclosing material information at the right time; as well as the board’s guidance to the company, supervision of the management, and accountability to shareholders and the firm.
Weight allocated to each area of the ASEAN Corporate Governance Scorecard for the Golden Arrow Awards
By looking at the country’s publicly listed companies and insurance companies through these areas, it seeks to improve corporate governance standards and practices in the Philippines and draw investors toward well-governed organizations.
The value of good governance
Such a Golden Arrow recognition from ICD could further give corroboration for these companies’ reputation and their governance.
InLife Executive Chair Nina D. Aguas — Photo from facebook.com/ICDPh
“The award is an affirmation of our good reputation and the quality of our engagement with our various stakeholders,” Insular Life (InLife) Executive Chair Nina D. Aguas told BusinessWorld.
“Since 2018, InLife has received consistent recognition from the ICD, a testament to our unwavering commitment to corporate governance principles and practices. These accolades not only bolster our reputation as a reliable institution but also foster trust among our stakeholders,” she expressed.
InLife Executive Chair Nina D. Aguas (third from left) receives InLife’s 4-Golden Arrow Award for good corporate governance during the ASEAN ACGS and CGS Golden Arrow Recognition Ceremony by the Institute of Corporate Directors (ICD). With her are (from left) ICD Chairman Atty. Cesar A. Villanueva, ICD Vice-Chair and President Ma. Aurora Geotina-Garcia, and Deputy Insurance Commissioner Ferdinand George A. Florendo. — Photo from facebook.com/ICDPh
InLife is one of the two insurance companies that recieved a 4-Golden Arrow Award in this year’s recognition.
With the company garnering such regard, Ms. Aguas said that it boosted InLife employees’ and agents’ motivation to do their work and “take pride” in belonging to the recognized organization.
“This newfound sense of value in their work results in a higher quality of performance both within and outside the workplace,” she said.
But aside from establishing a reputation upheld by the Golden Arrow award, ensuring good governance itself could already have an impact on the organization’s performance.
“Our dedication to strong corporate governance not only enhances stakeholder confidence but also contributes to our financial performance and long-term sustainability,” said Ms. Aguas.
Given such contributions to a company, it can be valuable to commit to promoting upright corporate governance. And commitment to good governance is significant for InLife’s competitiveness in the insurance industry, said Ms. Aguas.
“Good corporate governance for InLife represents the bedrock of our commitment. It is not just about compliance; it is a way of life. It encompasses the principles of transparency, accountability, and ethical behavior. At its core, it’s about fostering a culture where trust is paramount,” she said.
Best practices
Various practices are established and implemented to ensure good governance within an organization. But while a large part of this seemingly depends on the leadership, its implementation would also hinge on employees’ support.
At InLife, the board of trustees and senior management are playing a crucial role in setting the tone for the company, said Ms. Aguas. The executive chair also gives credit to InLife employees who observe the firm’s policies and procedures, as well as InLife’s agency force members for their support to driving the business.
“Most importantly, our policyholders are at the core of all our efforts. We continually adapt and innovate to better serve them, reinforcing our commitment, nurturing long-term relationships, and building their trust,” she added.
Ms. Aguas also said that equality, diversity, and inclusion are promoted in InLife, as well as highlighting the company’s furthering adoption of ESG (environmental, social, governance) sustainability.
“We firmly believe that corporations that act responsibly will continually garner the trust and confidence of customers, stakeholders, and the public, thus underpinning the business’ sustainability,” she said.
Also stating its commitment to promoting exemplary corporate governance, Cebu Landmasters, Inc. (CLI), the leading developer in VisMin which received a 2-Golden Arrow Recognition this year, shared several efforts it has undertaken to substantiate such a commitment.
Cebu Landmasters’ Corporate Governance Team, composed of Chief Finance Officer Grant Cheng, First Vice-President for Legal & Strategic Landbanking Atty. Larri-Nil Veloso, and Legal Counsel and Compliance Officer Atty. John Edmar Garde, received the developer’s 2-Golden Arrow Recognition given by the ICD. — Photo from facebook.com/ICDPh
“Cebu Landmasters, Inc. has always approached corporate governance as an integral component and a cornerstone program in doing business. It is viewed and considered in CLI as an organizational responsibility and commitment, hence, the established corporate governance principles and programs are embedded in the core and fabric of the CLI Way,” Atty. John Edmar Garde, legal counsel & compliance officer of CLI, told BusinessWorld.
While CLI’s board of directors institute and oversee the implementation of corporate governance practices and initiatives, the organization also established its Corporate Governance Committee to provide assistance to the board. The management team, meanwhile, also supported the board and the committee for the implementation through collaborative efforts with the departments, offices, and employees.
Among the efforts made by CLI concerning its corporate governance is to improve its reporting and disclosures, such as through its Integrated Annual Corporate Governance Reports (I-ACGRs).
“The improvement of the disclosures in CLI’s I-ACGRs was cited by ICD as among the key factors in the improved corporate governance rating of CLI over the past couple of years, culminating in the conferment of the organization’s first-ever Golden Arrows,” Atty. Garde shared.
The property developer has also sought to enhance corporate governance by putting in place policies and programs including its Whistle-Blowing Policy, updated Executive Committee Charter and Limits of Authority, updated Handbook on Employee Discipline, and Code of Business Conduct and Ethical Standards, among many others.
And to maintain an effective performance among those in leadership, CLI also conducts annual performance evaluation and assessment on the board, individual directors, board committees, and the management team.
Meanwhile, to ensure transparency and accountability, the developer assured public and timely disclosure of all material information that could affect the viability or interests of its stakeholders.
Possessing knowledge of the best practices and learning from experts could also help organizations in improving their corporate governance.
“It is also important that organizations have a keen interest and understanding of the recommended best practices and principles in corporate governance. As the saying goes, ‘Gaining knowledge is the first step to wisdom,’” Atty. Garde shared.
“The best practices established and publicly disclosed by other PLCs can also serve as [a] guide, as well as collaboration and learning from esteemed practitioners in corporate governance, which includes — among others — the ICD, are very helpful tools as the organization progresses in its corporate governance journey,” he added.
The Golden Arrow recognition also inspires SM Investments Corp. (SMIC), which received a 4-Golden Arrow recognition, to excel in corporate governance.
From L-R: ICD Chairman Atty. Cesar L. Villanueva; SM Investments Corp. Chairman of the Board Amando M. Tetangco, Jr.; ICD Vice-Chair & President Ma. Aurora D. Geotina-Garcia; and Securities and Exchange Commission Chairperson Atty. Emilio B. Aquino. — Photo from facebook.com/ICDPh
“This honor inspires us to continue advocating best practices in corporate governance in serving our stakeholders and communities,” said SMIC Chairman of the Board Amando M. Tetangco, Jr. was quoted as saying in a statement.
Photos from facebook.com/ICDPh
Alongside SMIC, several companies from the SM Group were also accorded Golden Arrow recognitions. These are: 2GO Group, Inc., APC Group, Inc., Atlas Consolidated Mining and Development Corp., China Banking Corp., BDO Unibank, Inc., Belle Corp., Pacific Online Systems Corp., Premium Leisure Corp., and SM Prime Holdings, Inc.
Effective and transparent corporate governance is necessary for fostering investor confidence and driving sustainable economic growth. It is the foundation of a strong business climate, promoting ethical practices and upholding accountability across the globe.
The Association of Southeast Asian Nations (ASEAN) recognizes the importance of corporate governance, introducing the ASEAN Corporate Governance Scorecard (ACGS) as a framework to enhance corporate governance practices in its member countries.
Established by the ASEAN Capital Markets Forum (ACMF) and the Asian Development Bank (ADB) in 2011 to raise corporate governance standards, ACGS serves as an instrument for assessing and ranking publicly listed companies (PLCs) in six participating ASEAN countries, namely Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam.
The scorecard system is based on international best practices, encouraging publicly listed companies to go beyond national legislative requirements, giving greater global visibility to well-governed ASEAN PLCs and promoting ASEAN as an asset class.
The 2015 revised Principles of Corporate Governance by the Organization of Economic Cooperation and Development (OECD) has brought the ACGS in line with the latest developments and emerging corporate governance standards. Hence, the revised ACGS comprises five parts: rights of shareholders, equitable treatment of shareholders, role of stakeholders, disclosure and transparency, and responsibilities of the board.
Philippine corporate governance at a glance
In the Philippines, the Securities and Exchange Commission (SEC) is the primary regulatory agency responsible for enforcing corporate governance standards. SEC, along with the Philippine Stock Exchange (PSE) and Insurance Commission (IC), has implemented various initiatives to promote good corporate governance standards and practices, including the adoption of the ACGS in 2012.
In the 2022 ACGS assessment published on Institute of Corporate Directors (ICD) Philippines’ website, the ICD reported an average score of 76.64 for 272 publicly listed companies in the Philippines, which is higher than the country’s average score during the 2021 assessment. With this increasing growth, the corporate governance performance of the PLCs in the Philippines has continued to improve steadily.
Moreover, the Top 100 PLCs by Market Capitalization scored an average of 90.68, compared to 2021’s 87.55 points. Most PLCs score above 70 points, with 60 companies rating between 70 and 79.99.
According to the report published by the ASEAN, the Philippines needs to significantly improve its commitment to upholding shareholder and stakeholder rights. The report advises that Philippine PLCs should comply with all mandatory disclosures set by regulators and work towards protecting internal and external stakeholders for sustainable development.
Meanwhile, the 2022 ACGS Assessment on the insurance industry assessed 111 insurance companies in the Philippines, with an overall result of 55.13 points, an increase of 3.57 points from the 2021 assessment.
Among the 111 insurance companies, 22 scored 80 points and above, and 80 companies were able to improve their overall score.
The Golden Arrow Awards
To recognize the outstanding Philippine publicly listed companies in corporate governance based on the ACGS, ICD holds the annual ACGS Golden Arrow Awards.
To be eligible for the award, companies must score a minimum of 80 points in the ACGS Assessment. This indicates that the company has demonstrated adherence to the Philippine Code of Corporate Governance and internationally recognized corporate governance practices endorsed by the ACGS.
Moreover, five levels of performance in corporate governance will be conferred, with each ascending level depicted by an increasing number of golden arrows.
This year, 130 companies were awarded golden arrows at the ACGS and CGS Golden Arrow Recognition, which brought together the corporate governance community and advocacy champions in the regulatory and business sectors.
Four PLCs received the highest award of 5-arrow recognition for achieving a score range of 120 to 130 points. The awardees are Ayala Land, China Banking Corp., Globe Telecom, and SM Prime Holdings.
Meanwhile, two insurance companies bagged the 4-arrow recognition for scoring 110 to 119 points. Included in the awardees are Insular Life Assurance Company, Ltd. and Pru Life Insurance Corp. of UK.
With these initiatives, the ICD actively promotes the adoption of good corporate governance not only to enhance the global competitiveness of the Philippines but also to strengthen the profitability and development of local companies.
Furthermore, the ACGS and the Golden Arrow Awards serve as a benchmark for companies to improve their corporate governance practices and attract investors.
Future of Philippine corporate governance
Corporate governance in ASEAN countries is collectively improving, with international best practices being incorporated into national corporate governance blueprints and strategies.
The implementation of the ACGS provides a rigorous methodology for assessing corporate governance practices, which can help companies identify areas for improvement and attract more investors.
The Asian Development Bank has continued to emphasize the importance of good corporate governance practices since these standards reduce vulnerability to financial crises, reinforce property rights, lower capital costs, and promote greater capital market development. Investors will also have greater confidence in companies with good governance and in markets that are backed by sound legal and regulatory regimes.
The implementation of the ACGS can also help improve the investment climate in the Philippines by promoting transparency, accountability, and good governance among publicly listed companies. This way, the Philippines can attract more investors and increase the visibility of the country as a wise investment destination.
As suggested by the ASEAN in their recent report on corporate governance, Philippine companies can enhance their competitiveness and attract foreign investment to fund their growth, which can help to build a vibrant private sector and lead to sustainable economic development in the Philippines.
Furthermore, the active promotion and adoption of good corporate governance practices in the government and private companies can enhance the country’s competitiveness and attract more foreign investment to fund growth.
For instance, amendments to the Public Services Act and Foreign Investment Act have opened up the market, making foreign direct investment simpler and more rewarding. Foreign investors can now own 100% of their ventures in certain critical industries in the Philippines, including infrastructure such as telecoms, airports, seaports, rail, and renewable energy projects.
In addition to good corporate governance standards and practices, these major changes can help build a strong and sustainable economy in the country. — Mhicole A. Moral
Boxes of fake cigarettes are seen at a police station in Manila. — PHILIPPINE STAR/MIGUEL DE GUZMAN
THE PHILIPPINE government could lose at least P60 billion in revenue this year due to illegal tobacco trade, which has severely undermined gains from the sin tax reform passed almost a decade ago, a lawmaker said.
Authorities are now doubling efforts to curtail the illegal trade of tobacco products, which are also being manufactured inside industrial hubs and openly sold in online stores.
House of Representatives Ways and Means Chairman Jose Maria Clemente S. Salceda said excise tax collections from cigarettes fell by 7.8% to P160.4 billion in 2022 from P173.9 billion in 2021, describing the downward trend as deeply alarming.
He noted the decline in excise tax collections was the biggest since the enactment of the sin tax reform law in 2012, which increased the taxes imposed on cigarettes and alcohol.
Despite the higher taxes, smoking prevalence only slipped to 23% in 2020 from 23.4% in 2019, which means “something else happened,” Mr. Salceda said at a forum on illicit tobacco trade on Tuesday.
“A decline of one billion sticks could not have been accounted for by an incidence decline of just 0.4 percentage point alone,” he said.
“It is more logical to suspect that illicit trade accounted for much of the decline in licit removals. The 2022 figures stare us in the face, with the problem becoming more undeniable,” he said, noting the illicit trade would likely hit 2.026 billion sticks by end-2023.
Mr. Salceda estimated the government revenue losses due to illicit trade in cigarettes at P60.6 billion this year if the trend persists.
The illicit cigarette trade will further worsen the smoking prevalence among Filipinos, he said, with the health costs of smoking-related diseases possibly swelling to P217 billion this year.
“The [government’s] revenue base will continue to shrink and there is a chance that prevalence might actually increase as a result of cheaper illicit alternatives,” Mr. Salceda said. “This is a serious national crisis.”
Bureau of Internal Revenue Commissioner Romeo D. Lumagui, Jr. said the illicit tobacco trade was estimated to have reduced the Philippines’ gross domestic product (GDP) by an average of 0.39% and cut employment by 4.9% between 2018 and 2022, citing a recent study by University of Asia and the Pacific and Federation of Philippine Industries, Inc.
He said the government stands to lose about P30.57 billion in revenues this year, 16.7% more than P26.19 billion in foregone revenue last year.
“This will also mark the fourth consecutive year that lost revenues have increased in volume,” Mr. Lumagui said.
He said foregone revenues are estimated to increase to P33.7 billion next year, P36.8 billion by 2025, P39.8 billion by 2026, and jump to P42.54 billion in 2027.
“To give an idea of the impact of these revenue losses on the country, just consider that the P26.19 billion in lost revenues in 2022 could have funded the construction of 57,000 socialized housing units, 8,642 classrooms and 75 hospitals,” he said.
Mr. Lumagui said the illicit tobacco trade happens in many forms, citing illegal manufacturing, counterfeit production, smuggling and bootlegging, which refers to the practice of buying cigarettes in large quantities from countries where taxes are low and selling them in countries where taxes are high.
The BIR has been conducting major raids to address the illicit trade, confiscating about P5.8 billion worth of fake cigarettes.
Mr. Lumagui said the Philippines’ location as a “gateway” to the Asia-Pacific region is both a boon and a burden because perpetrators have exploited the country’s “strategic location.”
“Our location makes it a considerable challenge to monitor — much less control — the movement of illicit ‘whites,’” he said. “For this reason, it is imperative that the Philippine government improve its border defenses, to support the tax administration in its efforts to control the illegal trade of cigarettes.”
Mr. Lumagui noted that a significant number of illicit cigarettes come from Malaysia and other neighboring countries. Industrial parks and economic and freeport zones have also been used in the illicit tobacco trade.
Many online stores are also illegally selling tobacco products.
Mr. Salceda said online stores have been selling unstamped cigarettes “at prices less than half those of their licit counterparts” — placing them under unrelated categories such as “Asian herbs” and “T-shirts.”
“On the review page, buyers indicated that they bought these cigarettes for their sari-sari stores, indicating that the purchase of these cigarettes online is meant for resale to the retail market,” he said.
In Facebook marketplaces, brands like San Marino, Casablanca, Cannon, Fort and Bravo sell for as low as P350 per ream, which is way lower than their mainstream counterparts, like the brand Marlboro, which sells for P1,750 a ream.
Illicit trade also happens at the high-end market, he added. For example, cigarettes by Chunghwa, a luxury tobacco brand in China, are available without tax stamps in Binondo for P350 a pack, Mr. Salceda said.
“There is no challenge to buying these brands. And they sell at as low as one-fifth the price of illicit cigarettes. Even fakes of premium brands are becoming easier to come by,” he added.
The BIR chief said they would intensify the monitoring of supply chains and distribution channels of tobacco products and enhance the track and trace system as well as the security features of the Internal Revenue Stamp Integrated System (IRSIS), which covers the internal revenue stamps that are currently in use.
The agency also plans to coordinate with local government units and various law enforcement agencies.
“We shall also endeavor to coordinate with our Asian neighbors, and work to form alliances with our counterparts in Malaysia, Indonesia, Vietnam, Taiwan and China,” he added.
Mr. Lumagui said the government would review and update rules and explore the possibility of imposing stiffer penalties.
“We will soon issue a Revenue Memorandum Circular updating the schedule of penalties and fines for violations of the excise tax provisions of the National Internal Revenue Code of 1997.”
Meanwhile, Mr. Salceda said he is looking to file a comprehensive anti-illicit tobacco trade bill, which would also authorize the blocking of all e-commerce platforms that allow the sale of tobacco products.
“We must attack the problem in its complete form — in every stage of the value chain,” he said. “That is why I am considering a comprehensive tobacco illicit trade bill that addresses everything from smuggling through the de minimis loophole and through our ecozones, to leakage of tobacco declared for export or transshipment, to the manufacture of fake cigarettes.”
At the same forum, advocacy group HealthJustice called for the implementation of a track and trace system that would record the movement of tobacco products throughout the entire value chain.
“This system should provide real-time monitoring and should be maintained by the BIR and the Bureau of Customs,” it said. “The need for a funding mechanism for this should be prioritized in a separate bill.” — Kyle Aristophere T. Atienza
