Key Role and Responsibilities
CHI's Board of Directors is the highest authority in matters of governance and in managing the business of the Company. The Board establishes the vision, strategic objectives, key policies, and procedures for the management of the Company, as well as the mechanism for monitoring and evaluating Management's performance. The Board also ensures the presence and adequacy of internal control mechanisms for good governance.
Composition
The Board consists of nine members who are each elected by Company's stockholders entitled to vote at the annual meeting. The Board members hold office for one year or until their successors are elected and qualified in accordance with the By-laws of the Company.
The Board represents a mix of business, legal, and finance competencies, with each director capable of adding value and rendering independent judgment in relation to the formulation of sound corporate policies. Directors are committed
to the collective decision-making processes of the Board. Decision-making at the board level adheres to an objective process that does not undermine the independence and integrity of judgment of each individual director. The names and profiles of each individual director are found in the Board of Directors section of this Annual Report.
None of the members of the Company's directors and management own two percent or more of the outstanding capital stock of the Company.
Independent Directors
As a publicly-listed company in the Philippine Stock Exchange (PSE), Cebu Holdings, Inc., conforms to the legal requirement to have at least two independent directors or at least twenty percent of its board size, whichever is less. Of the nine directors, Fr. Roderick C. Salazar, Jr., SVD, Enrique L. Benedicto and Hernando O. Streegan sit as the independent directors.
The Company defines an independent director as holding no interests or relationships with the Corporation that may hinder his independence from the Corporation or Management or would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The Company complies with the rules of the Securities and Exchange Commission with regard to the nomination and election of the independent director.
Chairman
The Chairman of the Board is Jaime I. Ayala, who assumed the position in 2004. Francis O. Monera holds the position of President. The existing board structure provides a clear division of responsibilities at the top of the corporation, between the working of the Board and the executive responsibilities for the business. The respective roles of the Chairman of the Board and the President are complimentary and ensures an appropriate balance of power, increased accountability and further provides a greater capacity of the Board for independent decision making. Both the Chairman of the Board and the President attend all Annual General Meetings of the shareholders.
Board Committees
The Board has established committees to assist in exercising its authority including monitoring the performance of the business. Four committees support the Board in the performance of specific functions and to aid in good governance. The committees are the Executive Committee, the Compensation Committee, the Nomination Committee and the Audit Committee.
Executive Committee. The Executive Committee acts in accordance with the authority granted by the Board or in case of absence of the Board on specific matters within the competence of the Board of Directors as prescribed in the Company's By-Laws, except with respect to any action for which shareholders' approval is also required such as distribution of cash dividends; filling of vacancies in the Board or in the Executive Committee; amendment or repeal of By-Laws or the adoption of new By-Laws; amendment or repeal of any resolution of the Board of Directors which by its express terms is not so amendable or repealable; and the exercise of powers delegated by the Board exclusively to other committees.
Compensation Committee. The Compensation Committee establishes a formal and transparent procedure for developing a policy on executive remuneration and for fixing the remuneration packages of corporate officers and directors. It provides oversight over remuneration of senior management and other key personnel.
In 2007, the Compensation Committee considered and approved: 1) the 2006 performance evaluation and promotion of associates, managers and executives; 2) 2006 performance bonus for the associates, managers and executives; 3) the salary adjustments for the qualified Managers and Executives for year 2007.
Nomination Committee. The Nomination Committee's main function is to install and maintain a process to ensure that all directors to be nominated for election at the annual stockholders' meeting have all the qualifications and none of the disqualifications for directors as stated in the By-Laws, the Manual of Corporate Governance of the Company and the pertinent rules of the Securities and Exchange Commission. Also, the Committee is tasked to review and evaluate the qualifications of all persons nominated to positions in the Company which require appointment by the Board.
In 2007, the Nomination Committee considered and approved the final list of nominees for directors for the year 2007-2008.
Audit Committee: As reflected in the Audit Committee Charter, the committee provides assistance to the Board of Directors in fulfilling their oversight responsibility to the shareholders relating to: 1) the company's financial statements and the financial reporting process; 2) the systems of internal and financial reporting controls; 3) the internal audit activity; 4) the annual independent audit of the Company's financial statements; and 5) compliance with legal and regulatory matters. The Audit Committee had three meetings in 2007. During these meetings, the Audit Committee reviewed and approved the following: 1) internal and external audit plans; 2) quarterly unaudited financial statements; 3) re-appointment of SGV as the external auditors of the; 4) the consolidated audited financial statements as prepared by the external auditors Sycip Gorres Velayo & Co. (SGV); 5) internal audit results; and 6) the conduct of an external Quality Assessment Review for the Internal Audit department in compliance with the Manual of Corporate Governance. |
