PSE urged to fill up vacant seat for non-broker director

The Securities and Exchange Commission (SEC) wants the Philippine Stock Exchange (PSE) to immediately appoint a non-broker director to represent the interests of market issuers in the bourse’s 15-man board.

SEC chairman Lilia R. Bautista said the exchange should immediately elect a replacement for WG&A president Enrique M. Aboitiz Jr., who declined his appointment as outside director after some brokers questioned the process by which he was nominated.

At present, the PSE has only 14 directors, seven of whom are brokers and the remaining seven are outsiders or non-brokers.

The outside directors comprise of independent directors including the president, and persons who represent the interests of issuers, investors and other market participants who are not associated with any broker or dealer or member of the exchange for a period of two years prior to his or her appointment.

"The PSE is technically in violation of the Securities Regulation Code which requires that 51 percent of the PSE board must be composed of non-brokers," Bautista said.

To comply with the SRC, Bautista said the exchange, through its board, could either elect a replacement for Aboitiz or hold a special stockholders‚ meeting to elect the 15th PSE director.

Bautista, however, prefers that the PSE board appoint the replacement for Aboitiz to immediately fill in the void in the 15-man PSE board.

Among the PSE broker-directors are Alicia Rita Arroyo, who was re-elected as chairman of the exchange; Vivian Yuchengco of First Resources Management & Securities Corp., Filomeno Francisco of AB Capital Securities, Eddie T. Gobing of Lucky Securities, Marita Limlingan of Regina Capital, Ismael G. Cruz of IGC Securities, and Francisco Villaroman of Securities Specialists Inc.

The non-broker directors, on the other hand, are PSE president Cayetano Paderanga Jr., banker Peter Favila, lawyer Francisco Ed. Lim, UP College of Law dean Raul C. Pangalangan, San Miguel Corp. president Ramon Ang, Philippine Long Distance Telephone Co. treasurer Annabelle L. Chua and Government Service Insurance System president and general manager Winston F. Garcia.