THE business sector does not need anymore the Implementing Rules and Regulations (IRR) of the Securities Regulation Code (2015 SRC) that Chairman Teresita Herbosa boasted in her press release. The IRR is not as urgent as Herbosa and her fellow commissioners may think it is. As a matter of fact, businesses will continue operating in this country even without an IRR. All they need is an investment climate that would encourage investments and not a government that tolerates an oppressive agency pretending to be regulatory.
What are rules for? There is no need to cite instances when the SEC as a whole has even defied the Supreme Court for the sake of a friend, be it a he, a she or a stock corporation. It is up to Herbosa and company to review their official actions on certain issues if they want to know what SC decisions they have totally ignored.
Unluckily, many, if not all investors, particularly the foreigners, fear the government’s many impositions that are too rigid for them to follow. Will the SEC ease the burden of over regulation that private companies have to contend with?
Too late for IRR
What is an IRR for when the SEC has already lost its jurisdiction over corporate intramurals? When stockholders go to war for control of the board, they do not need any of the IRR provisions to achieve corporate peace. Their fight no longer falls under SEC jurisdiction but under regular courts, where judges would rule accordingly based on the law and not based on the IRR.
In short, the IRR should have been conceived a long time ago when the SEC still exercised quasi-judicial power.
Unbeknown to the present breed of SEC officials led by Herbosa and her four fellow commissioners, the commission previously had a high batting average of almost 100 percent in having its decisions affirmed by the high court.
As a litigator when she was a practicing lawyer, Herbosa should know how difficult it was to engage in a corporate battle all the way up to the SC after losing a case at the SEC, whether before a panel of hearing officers or before the commission en banc.
As the 2015 SRC, the IRR has been a big waste of government money that should have been spent instead on improving SEC services by increasing the salaries of the commission’s rank-and-file workers. As has been the policy of the present national leadership led by Malacanang’s temporary chief occupant, only the presidential appointees deserve pay increases.
Pay and perks
As head of the SEC’s five-person commission, Herbosa must be a very busy government executive based on her annual compensation collated by the Commission on Audit. Last year, the government paid her P7.45 million, which translates to P621,840 a month, or P25,910 a day, or P5,182 per hour of five working hours only. (I assumed the number of hours because that is the length of time she and her co-commissioners spend at the SEC.)
Among the five members of the commission, Herbosa—again—must be the most industrious because P2.49 million separated her gargantuan compensation from that of two other highly paid SEC commissioners. Manuel Huberto B. Gaite and Antonieta F. Ibe received P4.96 million each in 2014. That’s P413,088 a month for the two commissioners, or P17,212 a day, or P3,442.40 an hour at five hours of active work per day.
What sets Herbosa apart from her counterparts in other government agencies is her basic salary. Herbosa’s basic pay in 2014 was P6.38 million , or 85.6 percent of her total pay and perks of P7.45 million. This made her the second highest-paid government official, next only to Robert G. Vergara, president and general manager of the Government Service Insurance System. In 2014, Vergara’s basic salary was P7.4 million, which represented 58.9 percent of his annual compensation of P12.6 million.
(Note: For those interested in knowing whether Herbosa and company are overpaid, please surf www.coa.gov.ph. You will be amazed by the numbers.)
Finally, here is Due Diligencer’s take on the SEC officialdom. The question that I have raised a number of times already is this: Does the SEC commission need five members for the agency to function effectively?
The answer is no. As it is today, its regulatory powers having been clipped by law, the SEC could perform its task as a depository of corporate files even without the entire commission. This may be seen as an exaggeration but it is not. (More on this in the next piece.)