The Securities and Exchange Commission (SEC) allowed the July 27 meeting—postponed from May 28 originally—to proceed, while “deferring or excluding” the election of directors from the agenda, the company said on Friday.
First Philippine Holdings is the publicly-listed parent of companies such as Rockwell Land Corp. and First Gen Corp. It is led by CEO Federico “Piki” Lopez, who is facing an ongoing ouster move by the Lopez family majority, led by his cousin, Eugenio “Gabby” Lopez III.
Rare SEC-approved setup
Annual stockholders’ meetings are important corporate events where shareholders review company performance, approve key decisions and elect directors who will run a company.
The SEC exemption keeps the current board in place for now.
“It only makes sense that the shareholders should agree among themselves first before deciding on leadership,” corporate governance expert Alexander Escucha told InsiderPH on Friday.
Escucha, the president of the Institute for Economic Development and Econometric Analysis, said he could not recall a similar case, although the SEC approval suggests the setup is legally allowed amid the dispute.
First Philippine Holdings must immediately call a separate stockholders’ meeting for board elections once the intra-corporate dispute is resolved or if a court orders the company to proceed with elections.
Beyond corporate governance
Business strategist Jonathan Ravelas said the deeper issue inside the Lopez group goes beyond standard corporate governance.
“The Lopez companies are not suffering from a lack of corporate governance. They are suffering from the absence of family governance,” said Ravelas, senior adviser at Reyes Tacandong & Co.
He said this refers to the lack of clear structures within the family itself for resolving disputes, handling succession, and making long-term strategic decisions before conflicts spill into the operating companies.
Lessons from other tycoon families
Escucha said families that have incorporated formal family governance structures within their organizations include the Sy, Zobel, and Aboitiz families.
Speaking from his personal experience at Sy-led China Banking Corp., where he helped establish governance frameworks, Escucha cited the Sy family as an example of how large conglomerates manage internal family decision-making.
“The Henry Sy family has a very strong fully functioning ‘family board’ — not officially incorporated — that meets every week, consisting only of the siblings, where the real decisions are made for each of the businesses and how they synergize with each other,” he said.
“It is a no holds barred meeting, and every one gets to comment, critique or contribute to every aspect,” he added.
What happened before?
The conflict erupted earlier this year after Lopez Inc., the family holding company that controls First Philippine Holdings, voted 5-2 to remove Piki Lopez over loss of trust.
A court later stopped the ouster through a temporary restraining order, freezing attempts to replace management while legal proceedings continue.
The dispute has drawn intense investor attention because it centers on multibillion-peso deals between First Gen and tycoon Enrique Razon Jr.’s Prime Infrastructure.
These transactions, which were not initially disclosed to the public, also included so-called poison pill provisions which could trigger financial consequences for the Lopez Group.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
