PSE Urged to Cede 51% to Non-Broker shareholders.(Business)
Byline: RYAN G. BORJA
The Philippine Stock Exchange (PSE) is required to amend its present corporate structure, wherein members of the board should be comprised of at least 51 percent non-broker shareholders to fully erase doubts as to the fairness of its management.
Without such divestment and full compliance with this new corporate structure, the country will continue to have an exchange "that might not meet the objectives of demutualization as intended by the securities law, the Securities and Exchange Commission (SEC) said.
SEC chairperson Lilia R. Bautista, in a letter to the PSE, said that while the majority of the board should be composed of independent non-broker shareholders, the remaining brokers should at least be proportionately represented according to their value of trade.
"We trust that you share our concern that the PSE needs to show its willingness to abide by the letter and spirit of the law for a fully demutualized exchange ...we agree that laws, rules and regulations are not panacea for a moribund market, the roots of which, you will agree, may be traced to both external conditions and internal scandals that rocked the local market last year," she said in a letter to PSE president Ernest Leung. …