Philippine SEC Seeks Independent Board at Stock Exchange

Source: Regulation Asia Editors, Regulation Asia 2020-07-02

The Philippine Stock Exchange currently has three independent directors on its 15-seat board. Under the proposed rules, a majority of the directors will have to be independent.

The Philippine SEC (Securities and Exchange Commission) has proposed to adopt new rules prescribing that the independent directors constitute a majority of the board of directors of exchanges and other organised markets in the country.

The Revised Corporation Code of the Philippines, which took effect in February 2019, authorised the SEC to “prescribe the number of independent directors” of exchanges, and empowered the regulator to “promote corporate governance and the protection of minority investors, through among others, the issuance of rules
and regulations consistent with international best practices.”

Best practices of major and comparable markets typically have non-executive and independent directors filling the majority of seats on the boards of their exchanges. These include Bursa Malaysia, SGX (Singapore Exchange), ASX and the SET (Stock Exchange of Thailand), among others.

Under the SEC’s previous rules, Philippine exchanges were required to have at least three independent directors. The PSE (Philippine Stock Exchange) currently has three independent directors on its 15-seat board.

The Philippine SEC

Philippine SEC Seeks Independent Board at Stock Exchange

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