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WITH the cause of consumers very much in the
forefront of the current battle between the Lopez clan and the
Government Service Insurance System (GSIS), Rep. Emmylou Taliño-Mendoza
of Cotabato, vice chairperson of the House Committee on Legislative
Franchises, has come up with the brilliantly practical idea of
requiring the Manila Electric Co. (Meralco) and all other utilities
to reserve at least one seat in their governing boards for
consumers.
“This way, consumers will have
someone whom they can count on, who will consciously look after
their interests at all times, in every board of every utility,
whether a distributor of electricity or a water concessionaire,”
Taliño-Mendoza said.
In the case of Meralco and other
utilities whose shares are traded on the Philippine Stock Exchange (PSE),
Taliño-Mendoza said they should be mandated to set aside for
consumers at least one of the two board seats allotted for
“independent directors.”
Under Securities and Exchange
Commission rules, publicly listed companies such as Meralco must
give two “independent directors” at least two board seats.
An “independent director” is
a non-executive member of the board of directors who is not directly
associated with a major investor in the corporation, and who is not
affiliated with the firm in any other capacity.
Taliño-Mendoza’s proposal came
on the heels of Meralco disclosing that retired Chief Justice
Artemio Panganiban—who was spotted last week occupying a front row
seat at an Italian fashion show held in Rustan’s—had been
nominated as an independent director of the firm, along with former
banking executive Vicente Panlilio.
The nominations of Panganiban and
Panlilio came as the Lopez family and the GSIS engaged in a stormy
proxy fight during Meralco’s May 27 annual meeting which lasted
for 14 hours.
The GSIS has been aggressively
pushing Meralco’s management to pursue reforms that would
intentionally drive down excessive electricity rates.
Taliño-Mendoza lauded the
resolve of the GSIS, which controls 23 percent of Meralco, to assume
the role of an activist shareholder of the country’s largest
distributor of electricity.
The Mindanao lawmaker said she is
totally behind the state-run pension fund’s initiative to lower
electricity rates.
“This clearly demonstrates that
the interests of shareholders and consumers need not be conflicted,
and that in the end, all shareholders are consumers first,” Taliño-Mendoza
said.
“We are all consumers first.
This is why the interests of consumers are paramount at all
times,” she added.
In a PSE filing, Meralco said two
existing independent directors on the firm’s board, Washington
SyCip and Federico Puno, “recently withdrew their acceptance of
and conformity to their nomination as independent directors of the
company.”
Meralco senior assistant vice
president Anthony Rosete told the PSE said that both Panganiban and
Panlilio “underwent the internal process for nomination in
accordance with the company’s amended by-laws and amended manual
of corporate governance.”
At present, Meralco has a board
of directors with 11 members, composed of Manuel Lopez, Felipe
Alfonso, Jesus Francisco, Christian Monsod, Peter Garrucho Jr.,
Generoso Tulagan, Winston Garcia, Bernardino Abes, Cesar Virata,
Washington SyCip and Federico Puno.
Abes and Garcia are GSIS chairman
and president, respectively, and represent the pension fund in the
Meralco board.
PSE records show that Abes,
Garcia, Tulagan, Virata, SyCip and Puno are listed as “independent
directors” of Meralco. Tulagan is a former three-term congressman
representing the third district of Pangasinan.
The rest of the board members are
considered representatives of the Lopez family, who control more
than one-third of Meralco.
Lopez, Alfonso and Francisco are
chairman-chief executive officer, vice chairman and president-chief
operating officer, respectively, of the firm.
Meanwhile, legislative headaches
keep piling up for the utility company, with the bicameral
Congressional Power Commission launching a new probe on allegations
that Meralco has been overpricing the electricity that it
distributes to more than 20 million people in 25 cities and 86
municipalities in Metro Manila and outlying districts.
rjottings@yahoo.com
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