Beruflich Dokumente
Kultur Dokumente
DEPARTMENT OF FINANCE
Ito\ us lioulknaid Curia Pahl() ()camp, Si Street
M11,uuld 101)1
2015
respectively, in terms of company practices employed in ensuring that directors are fit
and proper to hold such position. These guidelines shall include criteria on integrity,
experience, education, training and competence, and shall be consistent with the
standards herein set forth.
The implementation of the ranking system and the standards set forth in this
Department Order shall be without prejudice to, and shall be consistent with, all
applicable laws and existing rules and regulations of the IC and the SEC.
Section 2. Annual Ranking and Recognition. IC and SEC shall, on an annual
basis, rank covered entities in accordance with the ranking system respectively
promulgated pursuant to Section 1 hereof. The annual ranking generated by the IC and
SEC shall be used as basis for recognizing insurance companies and public companies
employing the highest standards in ensuring that their directors are fit and proper to
hold such position.
Section 3. Definition of Terms
The term "insurance company" shall include all partnerships, associations,
cooperatives or corporations, duly authorized by the IC to transact insurance business
in the Philippines, excepting mutual benefit associations. For purposes of this
Department Order, the term shall also include professional reinsurers, or entities that
transact solely and exclusively reinsurance business in the Philippines.
The term "public company" shall refer to a corporation duly registered with the
SEC having the following characteristics:
a. Has a class of equity securities listed on an Exchange; or
b. Has assets in excess of Fifty Million Pesos (P50,000,000.00) and having
two hundred (200) or more holders, at least two hundred (200) of which
are holding at least one hundred (100) shares of a class of the
corporation's equity securities.
Section 4. Ideal Minimum Qualifications of a Director. A director shall ideally have
the following minimum qualifications:
a. At least twenty-five (25) years of age at the time of his election or
appointment;
b. At least a college graduate or has at least five (5) years experience in
business;
c. Has attended a special seminar on corporate governance for board of
directors conducted or accredited by SEC or IC as may be applicable; and
d. Must be fit and proper for the position of a director of the covered entity,
taking into account the following factors: integrity/probity, competence,
relevant education/training (e.g., financial literacy), physical and mental
fitness, diligence, and knowledge/experience.
RE: Adoption of Guidelines Prescribing the Fit and Proper Rule for
Directors of Insurance Companies and Public Companies
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has not engaged in any activity that, under existing rules, disqualifies a person from
being elected as independent director in the same entity. The former independent
director who has undergone the aforementioned cooling period may be re-elected to
another term of five (5) years. After serving for a cumulative period of ten (10) years, an
independent director is ideally perpetually barred from being elected in the same
covered entity.
Section 8. Ideal Remuneration. A fixed amount of remuneration shall ideally be
given to independent directors at the level sufficient to attract and retain the quality of
directors to run the company successfully. Entitlement to such fixed amount shall ideally
be based on the results of an independent ratings mechanism which shall be
established for purposes of evaluating the performance of independent directors. Stock
options and performance benefits of any kind shall ideally not be included in their
remuneration package.
Section 9.
Separability Clause. If any part of this Department Order is
declared by the courts as unconstitutional or contrary to existing laws, the other parts
shall remain in full force and effect.
Section 10. Effectivity. This Order shall take effect immediately and all
concerned shall be guided accordingly.
CES R
I IMA
Secretary
025873
RE: Adoption of Guidelines Prescribing the Fit and Proper Rule for
Directors of Insurance Companies and Public Companies
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