Minority investors can add agenda items in company meetings
MINORITY INVESTORS are now empowered to add items to the meeting agenda of publicly listed companies, according to the Securities and Exchange Commission (SEC).
The corporate regulator issued Memorandum Circular No. 14 on Tuesday giving shareholders of listed companies representing at least 5% of outstanding capital stock to include items in regular or special stockholders’ meetings.
If the shareholders, whether alone or together, are qualified based on this criteria, the items they include in meeting agendas will be classified as “Other Matters.”
The new rule is set to take effect after two weeks from the memorandum’s publication in newspapers of general circulation. The SEC said this new guideline is meant to “promote good corporate governance and the protection of minority investors.”
If any officer or agent of a publicly listed company refuses to allow the shareholders to exercise this right, the company may be punished with administrative sanctions as listed in the Revised Corporation Code.
Among the penalties in the code are up to a P2-million fine, a cease and desist order, suspension or revocation of certificate of incorporation, and dissolution of the corporation and forfeiture of its assets.
“The newly issued rules promote good corporate governance and the protection of minority investors, in line with our mandate as the overseer of the corporate sector and the champion of the investing public,” SEC Chairperson Emilio B. Aquino said in a statement.
“The rules also bolster the reforms that the Commission and other government agencies have been pursuing to further improve the ease of doing business in the Philippines and make our economy more competitive globally,” he added.
The recent delistings of Melco Resorts and Entertainment (Philippines) Corp. and Travellers International Hotel Group, Inc. drew criticism from minority investors as the companies bought their shares at a much lower price than when they originally purchased them.
This eventually pushed the bourse operator Philippine Stock Exchange, Inc. to work on rules that would change the required approvals and tender offer price for voluntary delistings. — Denise A. Valdez
