IN last Monday’s Due Diligencer, I identified Bienvenido E. Laguesma and Eliza Bettina Antonino as SSS nominees to the 11-person board of Philex Mining Corp.
The piece drew a reaction from Joe Cortez, a media colleague, who informed me that Laguesma indeed received the compensation from Philex but turned it over to the SSS treasury.
In a text message, Joe wrote: “Re SSS Com Laguesma’s earnings from Philex Mines, remitted to SSS treasury.” Com is short for commissioner, Laguesma being a member of the Social Security Commission, which is SSS’ policy-making body.
Joe’s email included two certifications issued by SSS saying that Laguesma gave up the pay and perks he received from Philex, thereby beefing up by P2.2 million the accumulated contributions of SSS members.
I went over the details of the compensation of Laguesma as one of the 11 directors of Philex. From my reading, I concluded that the disclosure of executive payrolls should not be limited to “group compensation” as is the present practice. Instead, all listed companies should be required to individualize the salaries, bonuses and undefined “others” in the compensation filing for the information of the public.
If in 2015 Philex paid Laguesma P1.29 million, it may not necessarily follow that it also paid the other 10 directors the same amount. For instance, did Manuel V. Pangilinan receive only what the other Philex directors got last year? Probably not. As chairman, he should be getting more.
As the chief executive officer, Pangilinan was among the five highest-paid executives of Philex only in 2012. He disappeared from the list starting in 2013 until 2015.
In 2012, Pangilinan and four other Philex top executives as a group received a total of P74.83 million —salary, P36.04 million and bonus, P38.8 million. Anyone among the public stockholders of Philex would have to divide the total to get the average pay of about P15 million each. Did Philex pay MVP only this much?
From the readers
Sin of omission on future deficit of SSS, which appeared in this space on Monday, drew some reactions from readers of The Manila Times. Virgilio V. Hernandez even asked: “Shouldn’t an ordinary SSS member also be represented in the SSS board’s main policy body?”
Perhaps the reader meant to ask if an ordinary SSS member is qualified to get appointed to the Social Security Commission, which is the government body that promulgates the policies that govern SSS.
My response to Hernandez: Why not, but with reservation.
First, you must possess the most important qualification for membership in the six-person commission. You may also qualify to get appointed as the chairman.
An ordinary SSS member may aspire to any of the seven posts. As I responded “why not,” I am posing a follow-up question to “with reservation.”
Is an ordinary SSS member that close to anyone among Malacanang’s temporary tenants, led by their chief? Closeness to the appointing powers is what gets one appointed to a lucrative and powerful government post.
As the saying goes, it is not what you know but whom you know that usually gives you the advantage over others. Remember, we are in a democracy that survives on favoritism from the top to bottom in a government hierarchy.
Another reader claimed to be paying SSS the maximum contribution but now doubts the funds’ future benefits that would accrue to him. He said (assuming the reader is a he) it would be wiser for him to put his money in an investment that would make a “direct impact to my financials.”
The other comments may not please SSS top executives led by Emilio de Quiros as president and chief executive officer.
“SSS is a giant juice extractor,” another reader commented. “Members are squeezed of hard-earned money,” adding that the state-run pension fund’s executives enjoy millions in pay and perks including “director fees derived from investing members’ money.”
At this point, I have to explain that it is not wrong to invest SSS members’ money in listed stocks. The only question I raised in my column was: Should SSS continue to invest so much in stocks to the extent that it would be entitled to a board seat?
It is time to stop the practice of gaining representation on the boards of listed companies and go back to the basics of investing, which is to make money. In the case of SSS, the members’ contributions should be able to grow to meet the requirements of present and future retirees.
If SSS is not able to earn as much as its actuarial studies project it to generate, then by all means it should go somewhere else where its investible funds could yield more. It should not rely so much on its nominees turning over their director’s fees to its treasury.