• Executive Leadership Team of 2016 award goes to…



    The Asia CEO Awards held its annual awards night on October 18, 2016 at the Marriot Grand Ballroom. The said Asia CEO Awards, according to the organizers, “promotes leadership excellence and team-building within organizations, and displays Filipino business accomplishments to the world’s business leaders.”

    The Board of Judges of Asia CEO Awards 2016 had chosen former Department of Foreign Affairs Secretary Albert Del Rosario as this year’s Lifetime Contributor-Public Sector awardee. He was recognized for his leadership, under which “the Department of Foreign Affairs was consistently ranked as one of the nation’s top government agencies according to various surveys — despite his term being one of the most difficult in Philippine history.”

    But this is not the surprise of the annual awards.

    The Executive Leadership Team award is given to any profit-making organization, which has attained significant business accomplishments in the country and the world. The leadership team should have demonstrated exceptional leadership skills, and gave rise to the maximization of their stakeholders’ values.These year’s finalists were Acquire BPO, Cognizant Technology Solutions Phils. Inc., Concepcion Industrial Corp., Integrated Micro-Electronis Inc. (IMI), LBC Express Inc., and Subic Bay Metropolitan Authority (SBMA).

    And the winner is … SBMA. The Executive Leadership Team award was received by “former” SBMA Administrator Roberto V. Garcia. Conspicuously absent was newly appointed SBMA Chairman Martin B. Diño.
    What a surprise.

    Management Wrangling Within SBMA

    It can be recalled that Garcia submitted a “courtesy resignation” for the positions of Chairman and Administrator when the new administration of President Rodrigo Duterte took the helm of the government.

    On September 19, 2016 Garcia himself announced that Diño would be appointed Chairman and Administrator of SBMA. However, he (Garcia) would be on a holdover capacity pending the “official appointment” of Diño. Thereafter Diño sent a transition team to Subic to facilitate the smooth turnover of power.

    SBMA’s management problems arose when President Duterte “officially” appointed Diño as the “Chairman” of SBMA on September 30, 2016. Diño assumed office as “Chairman/Administrator/CEO” on October 3, 2016.
    Garcia then countered that the President merely appointed Diño as Chairman, not as Administrator, and hence, he (Garcia) would continue to serve as Administrator in a holdover capacity, pending the appointment of a new Administrator.

    On October 10, 2016 Diño announced that he “is duty bound to assume and perform the duties, powers and functions of the Chairman/Administrator and CEO pursuant to law.” On October 19, 2016 Malacañang accepted Garcia’s resignation as Administrator and designated SBMA Deputy Administrator (DA) for Legal Affairs Randy B. Escolango as Officer-in-charge (OIC) of the SBMA’s Office of the Administrator. On October 24, 2016, Diño lambasted Escolango, in front of the officers and employees of the agency, for what he said was an attempt to grab power from him.

    Meanwhile, PDP-Laban is allegedly pushing for the appointment of Marvin Ted Macapagal as SBMA Administrator. Macapagal was the campaign manager of President Duterte for Olongapo City and Zambales during the 2016 national elections.

    What is happening here? My insight tells me that there is something amiss in all of these appointments.

    Republic Act No. 7227

    SBMA was created by virtue of Republic Act No. 7227, known as the Bases Conversion and Development Act of 1992. With the said Act, it was “declared the policy of the Government to accelerate the sound and balanced conversion into alternative productive uses of the Clark and Subic military reservations and their extension.”
    Under Section 13 of the same Act, the SBMA was created and its functions and composition duly defined. To wit –
    “Sec. 13. The Subic Bay Metropolitan Authority.–

    “(a) Creation of the Subic Bay Metropolitan Authority – A body corporate to be known as the Subic Bay Metropolitan Authority is hereby created as an operating and implementing arm of the Conversion Authority.
    “(b) Powers and functions of the Subic Bay Metropolitan Authority – The Subic Bay Metropolitan Authority, otherwise known as the Subic Authority, shall have the following powers and function:

    “(c) Board of Directors – The powers of the Subic Authority shall be vested in the exercised by a Board of Directors, hereinafter referred to as the Board of Directors, hereinafter referred to as the Board, which shall be composed of fifteen (15) members, x xx

    “The chairman and the members of the Board shall be appointed by the President to serve for a term of six (6) years, unless sooner removed for cause except for the representatives of the local government units who shall serve for a term of three (3) years. In case of removal for cause, the replacement shall serve only the unexpired portion of the term.

    “No person shall be appointed as a member of the Board unless he is a Filipino citizen, of good moral character, and of recognized competence in relevant fields including, but not limited to, economics, management, international relations, law or engineering. Preference in the appointment of the members of the Board shall be given to residents within the Subic Special Economic Zone.”

    Very clearly, the members of the Board should be of good moral character, has competence in relevant fields such as economics, management, international relations, law or engineering. Did the appointees of the present administration possess such characteristics?

    Paragraph (d) of the same Section 13 is unequivocal on whom the President should appoint. It states in part,
    “(d) Chairman/Administrator – The president shall appoint a professional manager as administrator of the Subic Authority with a compensation to be determined by the Board subject to the approval of the Secretary of Budget, who shall be the ex officio chairman of the Board and who shall serve as the chief executive officer of
    the Subic Authority.”

    Question: Who should the President appoint?
    Answer: The Administrator.

    Question: What are the concurrent capacities of the Administrator?

    First Answer: The Administrator is the ex officio Chairman of the Board.

    Second Answer: The Administrator is likewise the Chief Executive Officer (CEO).

    “Ex Officio” is a Latin term, meaning literally “from the office”, and the sense intended is “by right of office”. Thus, if position “A” is derived by virtue of position “B”, then it does not follow that position “B” can be derived from position “A”. The reverse is not always correct.

    The appointment of Diño, as signed by the President, under date of September 23, 2016 (please see accompanying photo), states –

    “xxx you are hereby appointed as CHAIRMAN, BOARD OF DIRECTORS, SUBIC BAY METROPOLITAN AUTHORITY, for a term expiring on 30 June 2022 x xx”

    So there you are. Clear as the light of the day, Diño was appointed as Chairman. However, as pointed out earlier, the President cannot appoint the Chairman. The President should appoint the Administrator, who in turn, by virtue of his office, shall serve as the Chairman and the CEO.

    Diño was right in lambasting Escolango. The appointment of Escolango supercedes Diño’s appointment and it worsened the legal situation. When Escolango was appointed OIC of the Office of the Administrator, by operation of the law, he also serves as OIC Chairman, and OIC CEO.

    So, is Diño still the Chairman when on a later date an OIC Chairman was appointed? As a lawyer, I don’t think so.

    Executive Order No. 340 series of 2004

    Former President Gloria Macapagal-Arroyo issued Executive Order No. 340, thereby reorganizing the Board of Directors of the SBMA and defining the powers, functions and duties of the Chairman of the Board of Directors and the SBMA administrator.

    In there, the then President separated the personas of the Chairman and the Administrator – in contravention of the provisions of R.A. No. 7227.

    Is this allowed by the Constitution? Section 1, Article VI of the Constitution provides that the legislative power shall be vested in the Congress of the Philippines, which shall consist of a Senate and a House of Representatives. Article VII mandates that the executive power shall be vested in the President of the Philippines. Finally, the judicial power shall be vested in one Supreme Court and in such lower courts as may be established by law (Article VIII). This set up allocates authorities to each of the three equal branches of government to ensure political independence for each branch and provides adequate checks and balances against the concentration of power in any one branch.

    Admittedly, the President can “legislate” in some instances. Title I, Book III, of the Administrative Code of 1987 delegates to the President certain ordinance powers in the form of presidential issuances, which include executive orders, administrative orders, proclamations, memorandum orders, memorandum circulars, and general and special orders. These issuances have the force and effect of laws. Executive Orders are acts of the President providing for rules of a general or permanent character in implementation or execution of constitutional or statutory powers.

    However, elementary is the legal rule that the President cannot change a law, which had been duly legislated. It is only the Congress, which can amend and modify existing laws. The role of the President is simply to implement the law, and not to modify it.

    Even E.O. 340 recognized the juxtaposition of the positions of Administrator, Chairman, and CEO. Its third whereas clause, posits “WHEREAS, Section 13 of RA 7227 provides that the SBMA Administrator who shall serve as the Chief Executive Officer thereof, shall also be the ex officio Chairman of the SBMA Board of Directors”

    So it goes, that according to R.A. No. 7227, the Administrator shall serve as the Chief Executive Officer and shall also be the ex officio Chairman of the SBMA.

    Under E.O. 340, the SBMA Administrator shall serve as ex-officio Vice-Chairman of the SBMA Board. Likewise, the Administrator shall be the Chief Executive Officer of the SBMA.

    I believe that the Administrator, if we follow E.O. 340, has greater powers to wield than that of the Chairman. For one, the Administrator has the function “to execute, on behalf of the SBMA, all contracts, agreements and other instruments affecting the interests of the SBMA duly approved by the SBMA Board”. Second he has the power “to represent the SBMA in all dealings with offices, agencies and instrumentalities of the Government and with all persons and entities, public or private, domestic or foreign.”

    With this, the Chairman is relegated to be titular in nature, though he is the recognized head of the agency. There are other legal questions that came about out of the separation of these personas. I will no longer belabor about these other issues in my present column.

    Questioning Escolango

    Randy B. Escolango, who hails from Olongapo City, joined the Philippines Bar on May 3, 2002. Atty. Bart Q. Dalangin Jr. , on the other hand, passed the Bar in 2008.

    According to Subic Bay News, published on October 10, 2016, the Supreme Court had cleared Escolango of all the charges lodged against him. It seemed that the brouhaha stemmed from the complaint filed by Escolango’s former law partner, Atty. Dalangin Jr. The same source said, “On November 10, 2010, then SBMA Administrator and Chief Executive Officer (CEO) Armand C. Arreza, issued to Escolango a copy of the Formal Charge and Order of Preventive Suspension for the Administrative Offenses of Grave Misconduct, Dishonesty, Falsification of Official Document, Oppression, Conduct Prejudicial to the Best Interest of the Service and Violation of Section 9, Divestment of RA 6713 of the Code of Conduct and Ethical Standards for Public Officials and Employees.”

    It continued, “He was exonerated from the Charge of Falsification of Official Document for insufficiency of evidence. Grave Misconduct carries the penalty of dismissal, thus, Arreza dismissed Escolango, who filed an appeal to the Civil Service Commission (CSC).”

    The same publication claimed that the Supreme Court ruled the case (G.R. Nos. 220197-198) with finality, in favor of Escolango, on April 13, 2016. However, an online search of the Supreme Court jurisprudence bore no such records.

    The same online search revealed that in A.M. No. P-06-2130, a case filed by oneSusana E. Flores, Escolango was her counsel. The case Decision contained this portion,

    “On March 21, 2006, complainant, through her counsel Atty. Randy B. Escolango, filed a Manifestation with Motion manifesting that she would file a Reply to controvert the respondents allegations in his comment, at the same time asking for an extension of fifteen (15) days for the filing of her reply. Despite several extensions granted, Atty. Escolango failed to file the complainants reply. He was required to show cause why he should not be disciplinary dealt with or held in contempt for his failure,and was later imposed a fine of P2,000.00.”

    On the one hand, a search for Dalangin exposed that in Canadian Opportunities Inc. vs. Dalangin (G.R. No. 172223), the Supreme Court declared – “To our mind, four weeks was enough for the company to assess Dalangins fitness for the job and he was found wanting. In separating Dalangin from the service before the situation got worse, we find the company not liable for illegal dismissal.”

    It continued, “Dalangin was barely a month on the job when the company terminated his employment. He was found wanting in qualities that would make him a proper and efficient employee or, as the company put it, he was unfit and unqualified to continue as its Immigration and Legal Manager.”

    Anyway, the findings of the Court of Appeals in CA-G.R. SP Nos. 126397 and 128865, which the Supreme Court did not touch at all, confirmed the following,

    “But we take exception to the conclusion of the CSC that while Atty. Escolango is not liable for the charges of Grave Misconduct, Dishonesty and Violation of Section 9 of RA 6713, he is, nonetheless, liable for conduct prejudicial to the best interest of the service.”

    By the way, Escolango was an originally appointed to his post at SBMA by the Aquino administration.
    So, who do we believe? Escolango or Dalangin? Well, you decide.

    A Better Recourse

    In one of the front-page articles of another newspaper published on October 26, 2016, it quoted Executive Secretary Salvador Meldialdea as saying, “We’ll leave it to the courts to decide, but if there is no ruling yet, we’ll proceed with the current setup.”

    If this pronouncement is true, then Mr. Diño will be on the losing end.

    As clearly pointed out in this column, it is the Administrator, whom the President should appoint. In accordance with the provisions of the law, the appointed Administrator is the ex officio Chairman of the Board.The appointed Administrator is likewise the CEO.

    A better recourse for this Administration, to correct the perceived errors, and prevent management wrangling in SBMA in the very near future, is to 1.) revoke the appointment of Escolango, 2.) void the original appointment of Diño, and 3.) issue a new appointment to Diño as the SBMA Administrator. Voila, no more legal problems.

    * * *

    I met with Ka Leon Peralta of the Anti-Trapo Movement (ATM) and discussed with him at length the complaints that he filed against some present and former officials of the Philippine Charity Sweepstakes Office (PCSO). I am supposed to write about it in today’s column but space and time constrained me not to. Please wait for it in my subsequent columns.

    Lest it be misunderstood, we agreed that every Filipino should support the present administration of President Duterte. However, we should be vigilant at all times and observe the actions, and inactions, of the President’s appointees. Exposing what lies beneath these public officials should not be construed as anti-administration but as our contribution to good governance.

    It is the job of good men to question things that are not clear. Anything less is a sin.

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