Governance

Self-Assessment

An active and independent can successfully point out deficiencies or loopholes in the company operations and help solve issues internally on a timely basis.

Transparency and Full Disclosure, Accountability, Corporate Control

Basic principles of Effective corporate governance

Participation, Rule of Action, Transparency, Responsiveness, Consensus Oriented, Equity & Inclusiveness, Effectiveness &Efficiency, Accountability

Characteristics of Good Governance

Securities and Exchange Commission (SEC)

Ensure the accuracy, timeliness and fairness of public reporting of financial and other info for public companies

Equity and inclusiveness

Ensures that all its members feel that they have a stake in it and do not feel excluded from the mainstream of society.

Rule of Law

Impartial enforcement of laws requires an independent judiciary and an impartial and incorruptible police force

Transaparency

It also means that enough information is provided and that it is provided in easily understandable forms and media.

consensus oriented

It also requires a broad and long-term perspective on what is needed for sustainable human development and how to achieve the goals of such development.

Corporate Governance

It basically involves balancing the interests of a company's many stakeholders, such as shareholders, management, customers, suppliers, financiers, government and the community

Effective corporate governance

It is concerned in both the long-term earning potential as well as actual short-term earnings and holds directors accountable for their stewardship of the business.

Participation

It is important to point out that representative democracy does not necessarily mean that the concern of the most vulnerable in society would not be taken into consideration in decision making

Transaparency

It means that information is freely available and directly accessible to those who will be affected by such decisions and their enforcement.

Accountability

Not only governmental institutions but also the private sector and civil society organizations must be accountable to the public and to their institutional stakeholders.

Fair and equitable treatment of shareholders, Self-Assessment, Increase Shareholder's Wealth, Transparency and Full Disclosure

Objectives of Corporate Governance

Management

Operations and Accountability. Manage the organization effectively, provide accurate and timely reports to shareholders

Facilitate effective, entrepreneurial and prudent management that can deliver long-term success of the company, & Enhance shareholders' value and protect the interests of other stakeholders by improving the corporate performance and accountability.

Purpose of Corporate Governance

Board of Accountancy

Set accounting and auditing standards dictating underlying financial reporting and auditing conceptss

Principles, Recommendations and Explanations

The Code is arranged as follows: ___________________, ______________________, _______________________

"one size fits all"

This Code does not in any way, prescribe a "_______________________________________" framework. It is designed to allow boards some flexibility in establishing their corporate governance arrangements.

Increase Shareholders' Wealth

This only reflects the positive perception that good corporate governance induces potential investors to decide to invest in a company.

November 10, 2016

When did the SEC approved the Code of Corporate Governance for publicly-listed companies

Securities and Exchange Commission (SEC)

Who approved the Code of Corporate Governance for publicly-listed companies

Accountability

_________________________________ cannot be enforced without transparency and the rule of law.

Executive director

a director who has executive responsibility of day-to-day operations of a part or the whole of the organization.

Non-executive director

a director who has no executive responsibility and does not perform any work related to the operations of the corporation.

Conglomerate

a group of corporations that has diversified business activities in varied industries, whereby the operations of such businesses are controlled and managed by a parent corporate entity.

Management

a group of executives given the authority by the Board of Directors to implement the policies it has laid down in the conduct of the business of the corporation.

Independent director

a person who is independent of management and the controlling shareholder, and is free from any business or other relationship which could, or could reasonably be perceived to, materially interfere with his exercise of independent judgment in carrying out his responsibilities as a director.

Internal control

a process designed and effected by the board of directors, senior management, and all levels of personnel to provide reasonable assurance on the achievement of objectives through efficient and effective operations, reliable, complete and timely financial and management information, and compliance with applicable laws, regulations, and the organization's policies and procedures.

Enterprise Risk Management

a process, effected by an entity's Board of Directors, management and other personnel, applied in strategy setting and across the enterprise that is designed to identify potential events that may affect the entity, manage risks to be within its risk appetite, and provide reasonable assurance regarding the achievement of entity objectives.

Related Party Transactions

a transfer of resources, services or obligations between a reporting entity and a related party, regardless of whether a price is charged. It should be interpreted broadly to include not only transactions that are entered into with related parties, but also outstanding transactions that are entered into with an unrelated party that subsequently becomes a related party

Transparency and Full Disclosure

aims at ensuring a higher degree of transparency in an organization by encouraging full disclosure of transactions in the company accounts.

Governance

all processes of governing, whether undertaken by a government, market or network, whether over a family, tribe, formal or informal organization or territory and whether through laws, norms, power or language

Fair and equitable treatment of shareholders

all shareholders deserve equitable treatment and this equity is safeguarded by a good governance structure in any organization

Stakeholders

any individual, organization or society at large who can either affect and/or be affected by the company's strategies, policies, business decisions and operations, in general.

"comply or explain" approach

approach combines voluntary compliance with me disclosure

Regulators

are a response to Society's wishes to ensure that organizations, in their pursuit of returns for their owners, act responsibly and operate in compliance with relevant laws.

Recommendations

are objective criteria that are intended to identify the specific features of corporate governance good practice that are recommended for companies operating according to the code.

Self-Assessment

assess their behavior and actions before they are scrutinized by regulatory agencies

Stakeholders

can be anyone who is influenced, whether directly or indirectly, by the actions of a company.

Principles

can be considered as high-level statements of corporate governance good practice, and are applicable to all companies.

Efficiency

covers the sustainable use of natural resources and the protection of the environment.

shareholders/owners

delegating shareholders/owners delegating responsibilities through an elected board of directors to management and, in turn, to operating units with oversight and assistance from internal auditors.

Effectiveness

doing the right things

Efficiency

doing things right

Shareholders

effective oversight through election of board members, approval of major initiatives such as buying or selling stocks, annual reports on mgt compensation

Board of Directors

ensure that the organization is run according to the organization's charter and that there is proper accountability

Fair and equitable treatment of shareholders

ensures equitable and fair treatment of all shareholders of the company

Board of Directors

ensuring long term viability, enhancing the fs, implementing corporate strategies, approving plan or budget, monitoring or assessing assessments, overseeing management framework

Board of Directors

establishes corporate mission, vision and strategy; may engage in strategic planning

Financial transparency

financial statements that are clear with full disclosure and that reflect the underlying economics of the company.

Management

has always had the primary responsibility for the accuracy and completeness of an organization's financial statements.

Stakeholders

has an interest in the quality of corporate governance because it has a relationship to economic performance and the quality of financial reporting

Stewardship

including how well the company protects and manages the resources entrusted to it.

Accountability

is a key requirement of good governance.

Corporate Governance

is a system of direction, feedback and control using regulations, performance standards and ethical guidelines to hold the Board and senior management accountable for ensuring ethical behavior - reconciling long-term customer satisfaction with shareholder value - to the benefit of all stakeholders and society.

Code of Corporate Governance

is intended to raise the governance standards of Philippine corporations to a level at par with its regional and global counterparts.

Effective corporate governance

is transparent, protects the rights of shareholders and includes both strategic and operational risk management.

Code of Corporate Governance for publicly-listed companies

its goal is to help companies develop and sustain ethical corporate culture and keep abreast with recent developments in corporate governance

Non-Executive or Independent Director

its role is the same as the broad role of the entire board of directors

Management

manage the company's human, physical and financial resources, develop, implement and manage the organizational risks, policies and procedures, act as a conduit to the board

Transaparency

means that decisions taken and their enforcement are done in a manner that follows rules and regulations.

Effectiveness and Efficiency

means that processes and institutions produce results that meet the needs of society while making the best use of resources at their disposal.

board of directors and its audit committee

oversee management and, in that role, are expected to protect the shareholders' rights

Board of Directors

overseeing the management team, recommending auditors

Participation

participation of both men and women is a key cornerstone of ggod governance

Internal Auditors

perform audits of companies for compliance with company policies and laws, audits to evaluate the efficiency of operations, and periodic evaluation and tests of controls

External Auditors

perform audits of company fs to ensure that the statements are free from material misstatements including misstatements due to fraud

Governance

process of decision making and the process which decisions are implemented

Governance

process whereby elements in society wield power, authority and influence and enact policies and decisions concerning public life and social upliftment

Increase Shareholders' Wealth

protect the long-term interests of the shareholders

Audit Committees of the BoD

provide oversight of the internal and external audit function and the processes of preparing the annual fs as well as public reports on internal control

Rule of Law

requires fair legal frameworks that are enforced impartially

consensus oriented

requires mediation of the different interests in society to reach a broad consensus on what is in the best interest of the whole community and how this can be achieved.

Responsiveness

requires that institutions and processes try to serve the needs all stakeholders within a reasonable time frame.

Related Party

shall cover the company's subsidiaries, as well as affiliates and any party (including their subsidiaries, affiliates and special purpose entities), that the company exerts direct or indirect control over or that exerts direct or indirect control over the company; the company's directors; officers; shareholders and related interests (DOSRI), and their close family members, as well as corresponding persons in affiliated companies. This shall also include such other person or juridical entity whose interest may pose a potential conflict with the interest of the company.

Explanations

strive to provide companies with additional information on the recommended best practice.

Corporate Governance

system of rules, practices and processes by which business corporations are directed and controlled.

Code of Corporate Governance for publicly listed companies

the first of a series of Codes that is intended to cover all types of corporations in the Philippines under supervision of the Securities and Exchange Commission (SEC).

Board of Directors

the governing body elected by the stockholders that exercises the corporate powers of a corporation. conducts all its business and controls its properties.

Corporate Governance

the system of stewardship and control to guide organizations in fulfilling their long-term economic, moral, legal and social obligations towards their stakeholders.

shareholders/owners

they also require accountability as to how well the resources that have been entrusted to management and the board have been used.

Non-Executive or Independent Director

understand the organization, apply expertise and skills, assist management to keep performance objective at the top of its agenda

Board of Directors

understanding and protecting organization's fs, requiring and monitoring legal and regulatory compliance, approving financial reports, ensuring effective system of internal control

Publicly listed companies

whose ownership is organized via shares of stock which are intended to be freely traded on a stock exchange or in over-the-counter markets.