SEC chief vows to break down barriers
Veteran lawyer Francis Lim is direct with what he wants to achieve under his term as chief of the country’s corporate registrar: “I envision the SEC as a no-nonsense regulator—firm when necessary, but always fair, efficient, reliable and professional.”
This was less than 10 minutes into his speech to his colleagues at the Securities and Exchange Commission (SEC) when Lim officially sat as the agency’s chair on June 10.
After seven years, the lawyer and senior partner at ACCRALAW succeeded Emilio Aquino, who steered the SEC into a new era of digitalization.
Lim was the president of the Philippine Stock Exchange from 2004 to 2010, during which time he pushed crucial capital market and policy reforms. This includes the Personal Equity and Retirement Account Act, a voluntary retirement savings program that supplements existing government pension programs.
A law introducing real estate investment trusts in the country was likewise enacted during his tenure, allowing Filipinos access to a new investment option.
Now leading the other side of capital market development in the country, Lim is looking at revising this law to “better meet market demands.”
Reforms lined up
On his first day as SEC chair, Lim vowed, among many other things, to continue the agency’s legacy of service while also breaking down barriers that have made it difficult for retail investors to penetrate the capital markets.
“Let’s also be honest: the Philippine capital market has been lagging behind,” Lim says in the same speech. “Inclusive growth demands deeper, broader and more accessible capital markets. We will leave no stone unturned to catch up—and with God’s help and our collective will, we will lead.”
Last December, the Organization for Economic Cooperation and Development found that long processes and loose enforcement of governance policies are preventing around 400 private enterprises from braving the local stock market.
This, as the Philippines lagged behind its Southeast Asian peers in terms of capital market development.
It was second to the last among its neighbors when it came to key governance indicators, including corporate and shareholder governance, protection of minority shareholders’ interests and regulatory quality.
For Lim, the change needs to begin within the commission.
Barely a month into his term, the SEC chair slashed by half the fees for corporate document requests, his first major policy change, which analysts called “a very sensible move” that made the regulator more approachable for the public.
“The SEC is becoming more people-friendly,” one analyst says.
A few weeks later, Lim signed a new circular essentially mandating the SEC to be stricter with its processing times. Requests left unaddressed beyond the prescribed period at the SEC will be “deemed approved” to promote ease of doing business.
“I said on Day One that I wanted the SEC to be known not only as a good regulator, but as a good facilitator of doing business,” Lim says. “This policy breathes life into that promise; we are removing bottlenecks, eliminating unreasonable delays and imposing discipline in our internal processes to give entrepreneurs and investors the level of responsiveness and certainty they deserve.”
Financial literacy advocate
He is also a firm believer in beginning financial literacy training as early as high school and exposing the younger generation to investment options, thus creating lasting impact.
During his stint as president of the Financial Executives Institute of the Philippines, Lim pushed for the Capital Market Development Act. While it had been approved at the House of Representatives level, it was not passed at the Senate level.
“I inserted [provisions about] making [financial literacy] mandatory in either senior high school or first year college, and I want to push it,” Lim tells reporters.
“Every student, regardless of the course that they would major in, should have a financial literacy program, knowledge of how capital markets, the stock market, the bond market, how to go about these investments.”
With lots still on his plate and more than six years ahead in his term–including major policy reforms and collaborations–Lim is clear about keeping the SEC at the top of its game.
“We serve with integrity, act with urgency and lead with purpose so the market can trust, investors can thrive and our nation can grow,” he says.
