Board of Directors

The Board is primarily responsible for the governance of Meralco. Corollary to setting the policies for the accomplishment of the corporate objectives, the Board also provides an independent oversight on Management. The Board establishes Meralco’s vision, mission, strategic objectives, policies and procedures that guide its activities, including the mechanisms for effective monitoring of Management’s performance. The Board also ensures that internal control mechanisms for good governance are adequate.
 

Board Composition

The Board consists of 11 directors who are elected by the stockholders during the AGM. The Board represents a mix of disciplines in the area of business, finance, operations and legal competencies, with each director capable of adding value and exercising independent judgment. Of these directors, two are independent directors, eight are non-executive directors, and one is an executive director. The composition of the Board clearly delineates their responsibilities with those of Management

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Board Independence

Meralco complies with Rule 38 of the Implementing Rules of the SRC on the qualifications, nomination and election of independent directors. Each elected independent director has no business or other relationship with Meralco that could, or could reasonably be perceived to, materially interfere with the exercise of his independent judgment in carrying out his responsibilities as a director.
 

The Chairman of the Board and the President and CEO

To further strengthen the Board’s independence, the position of the Chairman of the Board is separated from the President and CEO. Each position has distinct and separate duties and responsibilities in accordance with Meralco’s amended By-Laws and Revised Manual of Corporate Governance. The Chairman of the Board is Manuel V. Pangilinan, while the President and CEO is Mr. Oscar S. Reyes.
 

Election of Directors

In accordance with the provisions of the Company’s By-Laws and Manual of Corporate Governance, the Corporation Code of the Philippines and the SRC, nominees for board directorship go through a nomination and screening process. The final list of nominees is determined after pre-screening and evaluation. The directors are elected by stockholders who are entitled to vote during the AGM. They serve for a period of one year and until their successors are qualified and elected.
 

Board Remuneration

Meralco’s directors do not receive any compensation other than the Board-approved per diem for their attendance in Board and Committee Meetings. In 2012, each director was entitled to a director’s fee of Php120,000 for each Board meeting attended. Each member or advisor of the Audit and Risk Management, Remuneration and Leadership Development (formerly Compensation and Benefits), Finance, Nomination and Governance Committees was entitled to a fee of Php20, 000 for every committee meeting attended.
 

Board Performance

The Board holds monthly meetings and special Board meetings, if so required, with agenda that include updates by the Chairman of the Board and the Board committees, reports on financial performance by the Chief Finance Officer or CFO, and operational performance by the President and CEO, the Senior Executive Vice President and Chief Operating Officer, or COO, among other major issues of Meralco.

The Board has a pre-determined schedule of the Board meetings before the beginning of the year, which is regularly held during the last Mondays of the month. During Board meetings, discussions are open and independent views are given due consideration. In 2013, there were 13 Board meetings and each director has attended at least 77% of these meetings.

The Board has a pre-determined schedule of the Board meetings for the ensuing year, which is regularly held during the last Mondays of the month. The following table shows the participation of the Board in the AGM, Organization Meeting and its regular meetings:

 
Director Designation May 28, 2013 Board Meetings
Annual General Meeting Organizational Meeting
Manuel V. Pangilinan3 Chairman Present Present 13/13
Ramon S. Ang Vice-Chairman
and Director
Present Present 10/13
Manuel M. Lopez Director Present Present 13/13
Jose Ma. K. Lim Director Present Present 12/13
Ray C. Espinosa4 Director Present Present 13/13
Estelito P. Mendoza Director Not Present Not Present 11/13
Artemio V. Panganiban2 Independent
Director
Present Present 13/13
Vicente L. Panlilio* Director Present Present 10/12
Eric O. Recto* Director Present Present 12/12
Oscar S. Reyes Director Present Present 13/13
Pedro E. Roxas1 Independent
Director
Present Present 12/13
James L. Go** Director N/A N/A 1/1
Lance Y. Gokongwei** Director N/A N/A 1/1
1  Chairman, Nomination and Governance Committee
2  Chairman, Audit and Risk Management Committee
3  Chairman, Remuneration and Leadership Development Committee
4  Chairman, Finance Committee
*  Messrs. Eric O. Recto and Vicente L. Panlilio resigned effective December 11, 2013.
** Messrs. James L. Go and Lance Y. Gokongwei were elected on December 16,2013.

The Board recognizes the importance of a regular performance assessment, individually and collectively as part of their accountability. Assessments were done to evaluate their specific and overall performance for the past calendar year. The assessment of their 2013 board and board committee performance was conducted on February 24, 2014. The Board evaluated their individual and collective performances regarding the Board and its committees’ structures, processes and responsibilities. The assessment likewise identified the training and skills development program needed by the Board.

The Board reviewed the 2013 performance of the President and CEO on April 30, 2014. It was based on the attainment of target corporate goals for 2013.

Four (4) assessment instruments were accomplished by the directors:
  1. Board Self-Assessment - each director assessed the board performance as a whole and their individual performance.

  2. General Board Committee Performance Assessment - each director assessed the overall performance of the different committees.

  3. Board Committee Self-Assessment - each committee member assessed their performance vis-à-vis their respective charters.

  4. President & CEO Performance Assessment – each director assessed the performance of the President & CEO vis-à-vis the attainment of corporate goals and key performance indicators.
     

Details of the process, criteria and copies of the assessment instruments used are available for viewing and download below. 

Board Self-Assessment
Board Committee Self-Assessment
President and CEO Performance Assessment
General Board Committee Performance Assessment