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The Corporation Code contains its own set of “corporate governance (CG) principles,” which can be summarized into the following general statements:
What is the score of global hunger in ASEAN?
In a previous article entitled “Fiduciary Duties of the Board of Directors and Management under SEC’s Codes of Corporate Governance,” we discussed how the corporate governance reforms undertaken by the Securities and Exchange Commission (SEC) in the sector of publicly held and publicly listed companies have expanded the duties and obligations placed upon the Board of Directors and Management and formally increased the constituencies they serve, beyond just the stockholders, thereby subjecting directors and senior officers to greater personal liabilities for misfeasance and nonfeasance in relation to such fiduciary duties and obligations. It is fitting, therefore, that in the face of such increased professional and personal responsibilities, SEC has, in tandem, increased the powers of administrative supervision of the Boards over their members to ensure that directors act with full transparency, responsibility and accountability, with the utmost degree of professionalism and effectiveness.
Low tax rates can mean high revenue collections if implemented and administrated correctly. But to do that, the taxes first need to actually be collected. Based on the BIR’s 2017 Annual Report, most of the tax collections for individuals came from withholding taxes on wages. Of the P390.85 billion collected from individuals, P317.74 billion came from the withholding tax on compensation income earners.
2018 is a subdued year for many world-traded commodities. Prices are down. The Philippine countryside was not spared, as it is reeling from the effects of low farm prices of coconut oil palm and rubber. The bitter part is that farmers and workers are saddled with high food prices.
As shown hereunder, it seems clear that ultimately the Corporate Governance (CG) Code for Publicly-Listed Companies (PLCs) places the ability to prevent corporate opportunism squarely on the shoulders of the independent directors (IDs), whether such attempts at corporate opportunism be on the part of the controlling stockholders acting through a majority of the members of the Board, or through Management.
High-value commercial crops refer to “those crops that have competitive returns on investment when traded in fresh form vis–a–vis alternative investment opportunities. These crops are characterized by defined regular or niche market or potential domestic and/or export markets, command high prices, with value added or are good foreign exchange earners. High-value commercial crops are also called non-traditional crops. (High Value Crops Farmer Guidelines – Department of Agriculture (DA) – CAR).
In contrast to the Revised Corporate Governance (CG) Code for Public Companies (PCs) which refers only to the role of independent directors in exercising independent judgment as against “management,” the CG Code for Publicly Listed Companies (PLCs), in defining an independent director clearly delineates between “management” and “controlling shareholder,” thus.
It is worth pointing out that the Securities and Exchange Commission (SEC), in formally adopting the Corporate Governance (CG) Code for Publicly Listed Companies (PLCs), effectively provides that the Revised Code of CG, “shall remain in effect for other covered companies, when applicable.” There currently exists, therefore, two separate and distinct CG regimes in the Publicly Held Companies (PHC) sector, namely.
The Comprehensive Tax Reform Program seeks to implement a fairer, simpler, and more efficient tax system. Toward this end, it has implemented relatively lower tax rates under Tax Reform for Acceleration and Inclusion (TRAIN) Law and also targeting to lower tax on corporate income under Tax Reform for Attracting Better And High-quality Opportunities (TRABAHO). Unfortunately, this comes at the cost of increasing other tax rates.
For most Filipino companies, diversity and inclusion (D&I) is hardly a top priority. Although Corporate Philippines generally welcomes women and LGBT into the workforce -- unlike other societies where they are overtly excluded -- there is hardly any effort to ensure that office rules and policies promote D&I.
Since the Securities Regulation Code’s (SRC) promulgation, there have arisen many issues regarding the rationale or efficacy of the system of independent directors (IDs), with passionate advocates on both sides of the debate.
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THE Securities Regulation Code (SRC) institutionalized within the PHC (publicly held corporation) sector the system of “independent director” (ID) which it defines as “a person other than an officer or employee of the corporation, its parent or subsidiaries, or any other individual having a relationship with the corporation, which would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.”
THE corporate system of “Independent Directors” does not exist under the current version of the Corporation Code of the Philippines, where the aspect of “minority representation” is covered by the requirement of cumulative voting, which makes it mathematically possible for minority shareholders to pursue minority representation in the Board of Directors. This is understandable since the primary role of the Corporation Code (CC) since its enactment in 1980 is to be the “general enabling law” referred to in our Constitution by which private corporations of all types may be organized for private interests, covering all types of corporations, stock and nonstock, close or family-owned, and not merely limited to “publicly-held corporations” (PHCs).
Under the GOCC Governance Act, the corporate governance standards for directors/trustees and officers of GOCCs have by expressed statutory imprimatur far exceeded those for the directors/trustees and officers in PHCs under the Corporation Code, the Securities Regulations Code, and the SEC Code of Corporate Governance, as follows.
PACKAGE 2 of the Tax Reform for Acceleration and Inclusion (TRAIN) has been met with protests, especially from the Philippine Economic Zone Authority (PEZA) and the Board of Investments (BoI). One of the notable features which remains to be the most controversial portion of the Comprehensive Tax Reform Program is the incentive reform.
The GOCC Governance Act requires of directors, trustees, and officers in the GOCC Sector to “[a]ct with utmost and undivided loyalty to the GOCC,” and to “[a]void conflicts of interests and declare any interests they may have in any particular matter before the Board.”
In the private corporate sector as currently governed by common law developments under the Corporation Code, the “business judgment rule” pervades in defining the duties, responsibilities, and liability of directors, trustees and officers. The rule proceeds from the corporate set-up of Centralized Management which grants to the Board the sole authority to determine policy and conduct the ordinary business of the corporation within the scope of its charter. As long as the Board acts honestly and in good faith, the courts will not interfere in their judgments and transactions; and that minority members of the Board and the stockholders cannot come to the courts to change the course of the administration of the corporate affairs.
By and large, current management principles and practice are a throwback from a relatively placid era long gone. Their intellectual moorings are largely the handiwork of legendary management guru Michael Porter whose Five Forces model of the business enterprise, to this day, continues to dominate management thinking and practice -- three and a half decades since the publication of his classic work, “On Competition.”
The GOCC Governance Act formally characterizes the members of the Governing Boards and Officers of GOCCs as “fiduciaries of the State” with “the legal obligation and duty to always act in the best interests of the GOCC, with utmost good faith in all its dealings with the property and monies of the GOCC.”
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