Good governance for all, now!
When the code was promulgated in 2009, understandably, the SEC took the cautious, safer but longer route to allow the business community to gradually warm up to the idea of mandatory compliance with good governance regulations
A few weeks ago I wrote a piece on the “Ambivalence of Good Governance.” My message in essence was that “good governance,” although on the surface fairly straightforward, can in fact be sugary sweet for some but deathly bitter for others, as exemplified by some situations I cited such as the Russo-Ukrainian conflict, Elon Musk’s takeover of Twitter and fossil fuel guzzling power plants. It all depends on the point of view one takes in declaring an act as being “good.”
But hold on folks, I may be treading on a slippery slope here. Isn’t that relativism?
Hmm, I wouldn’t want to go into a debate on the truth or falsity of relativism since I certainly am not qualified to even attempt to philosophize on the disparate aspects of relativism that numerous noted philosophers of the past have vainly attempted to pin down. To illustrate this conundrum, with the aid of Mr. Google, let me share what I picked up from the Stanford Encyclopedia of Philosophy.
On one hand, “defenders see the doctrine as a harbinger of tolerance and the only ethical and epistemic stance worthy of the open-minded and tolerant.” Simple language translation, anything goes, it’s a free world! On the other hand, detractors dismiss it for its alleged incoherence and uncritical intellectual permissiveness.” Simple language translation, hey buddy, that’s hogwash morality and downright kindergarten stuff intellectually!
Hmm, see what I mean?
But how in heaven’s name is all that stuff relevant to posit “Good Governance For All, Now”?
Well, notwithstanding my previous article on the relativism of good governance and the likely pushback I will get from a fraternity batchmate who was all praises for that hypothesis, I happen to be a firm believer in the absolute truth of the goodness of an act that engenders happiness for the greatest number of people, is the way to go. And doing Good Governance does just that.
I believe, by and large, given the penchant of most corporations to merely do lip service to ‘comply,’ it will be a long and arduous climb for the Philippines to achieve global governance standards.
This brings me to the point that if good governance sparks off a multitude of virtuous cycles of benefits to so many, with due apologies to Securities and Exchange Commission Chairman Emilio Aquino who, by the way, has done a tremendous job in promoting good governance that has been widely acclaimed both here and abroad, why then does the SEC’s Code of Corporate Governance limit the application of the code to only publicly listed corporations, securities issuers and public companies (unlisted but meeting the threshold of what SEC deems to be sufficiently public). Furthermore, the code in several sections merely recommends certain best practices but does not actually mandate compliance and provides an easy out for corporations to just explain why they are not compliant. There are of course a handful of notable exceptions who live and breathe good governance but, I believe, by and large, given the penchant of most corporations to merely do lip service to “comply,” it will be a long and arduous climb for the Philippines to achieve global governance standards that will meet the expectations of international institutional investors who go way beyond the bottom line in their criteria for investing.
When the code was promulgated in 2009, understandably, the SEC took the cautious, safer but longer route to allow the business community to gradually warm up to the idea of mandatory compliance with good governance regulations for fear of upsetting what then was a fragile capital market.
But it is now 2022, and although there has been definite progress, the world outside our borders has moved at a much faster pace obviously because of the lengthy list of sensational corporate governance mishaps. We are definitely not the only game in town as many in our part of the world are moving more aggressively to attract investments. If we want to truly jumpstart the economy and buttress our teetering capital market, the SEC should just bite the bullet and mandate compliance with the Code, now!
Until next week… OBF!!!