MANILA, Philippines—President Benigno Aquino III has given provisional authority to the Presidential Commission on Good Government (PCGG) to dismiss government-appointed directors in sequestered corporations and replace them with new ones.
Executive Order No. 42, signed by Mr. Aquino and Executive Secretary Paquito Ochoa Jr., on May 9, said the dismissed directors may be replaced with up to two members from the PCGG.
According to the EO, the provisional authority is to be exercised by the PCGG chair and the appointment of the provisional director will be valid until the President appoints a permanent replacement.
The justification for the dismissal is that a number of nominee-directors occupying positions in the sequestered positions were doing so in a holdover capacity from the Arroyo administration.
“There is a need to ensure that the directors appointed to these positions are faithful in the discharge of their fiduciary duties and in serving and safeguarding the interest of the Philippines and the Filipino people,” the EO said.
All government-nominated directors will be required to submit to the PCGG monthly reports or as often as may be required on the affairs, developments and transactions affecting the respective corporations, the EO said.
The PCGG is to submit a detailed summary of these reports “from time to time” to the President.
According to the President, the EO is meant to prevent paralysis in the sequestered firms while making sure that the government’s interest is adequately represented.
Deputy presidential spokesperson Abigail Valte said Malacañang is confident that EO 42 can withstand legal scrutiny.
“We believe that, again, should it be taken to task, it will stand judicial scrutiny,” Valte said.
A number of Mr. Aquino’s executive orders have been challenged before the courts.