The Securities and Exchange Commission is pushing for more transparency reforms in the country and even across Southeast Asia, particularly through disclosures or beneficial ownership data, to promote “financial integrity” and combat corruption.
The SEC said it had already made “significant progress” in implementing its beneficial ownership policies, as these resulted in a “marked increase” in compliance rates from companies, to around 70 percent from only 30 percent five years ago.
Beneficial ownership refers to a person or entity that owns or controls a company, although their names are often not stated in official documents. They are usually the ones who get the most gains from the company’s finances.
The SEC call came after it promoted its policies at a recent anti-corruption and transparency event in Indonesia.
The regulator had previously worked with the United Nations Office on Drugs and Crime to improve the process of disclosing beneficial ownership data among companies in the Philippines. In 2019 and 2020, the SEC mandated the declaration of beneficial ownership data in the general information sheets of domestic and foreign corporations.
The issuance of bearer shares, which make it difficult to track the rightful owner of shares, as ownership can be transferred by delivering the certificate to the buyer, was also prohibited to enhance transparency.
The commission also called on regional cooperation, saying it is crucial to achieving sustainable progress in the fight against the misuse of corporations for crimes.
Transparency reforms that can promote financial integrity and combat corruption are always welcome, especially if our Securities and Exchange Commission can implement such reforms properly. Such successes also give our SEC the track record and influence to encourage further regional cooperation in the fight against corruption and organized crime.
A SEC that can perform well enough in this regard, enough to show the way and influence its regional peers, will surely benefit not just the Filipino people, but Southeast Asia as well.*
