Implementation of the Self-Rating System on Corporate Governance

April 3, 2003 SEC MEMORANDUM CIRCULAR NO. 05-03 IMPLEMENTATION OF THE SELF-RATING SYSTEM ON CORPORATE GOVERNANCE In order to assess the level of compliance with the leading practices and principles on good corporate governance, the Commission hereby directs the following companies to submit their duly accomplished Corporate Governance Self-Rating Forms (CG-SRF) not later than July 31, 2003: HAECID a.) Issuers of registered securities to the public whether or not listed in the Philippine Stock Exchange (PSE); b.) Public companies or those with assets of at least Fifty Million Pesos (P50,000,000.00) or such other amount as the Commission shall prescribe, and having Two hundred (200) or more holders each holding at least One hundred (100) shares of a class of its equity securities; c.) Finance companies; d.) Investment houses; e.) Brokers and dealers of securities; f.) Investment companies; g.) Pre-need companies; h.) Subsidiaries or branches of foreign corporations which operate in the Philippines and are listed in the PSE; i.) Stock and other securities exchange/s. The duly accomplished CG-SRF shall be a one-time submission. Any change therein shall be disclosed in a current report (SEC Form 17-C) by companies covered under paragraphs (a) and (b) above. Companies under paragraphs (c) to (i) shall report said change in a formal letter addressed to the Commission. Any company deviating or not complying with its Manual on Corporate Governance is hereby ordered to give its explanation thereto and/or reasons therefor. Issued this 3rd day of April, 2003 at Mandaluyong City, Philippines. (SGD.) LILIA R. BAUTISTA Chairperson CORPORATE GOVERNANCE SELF-RATING FORM (CG-SRF) GENERAL INSTRUCTION (1) Application of SRC Rule 72.1: Requirements for Filing Forms SRC Rule 72.1 contains general rules and regulations which are applicable to reports on forms to be filed with the Commission and should be carefully read and observed in the preparation and filing of this form. cHESAD (2) Preparation of this Filing (a) This document may be considered as a blank form to be filled in except if the responses would require more spaces in which case, separate pages with the proper captions shall be submitted with the form. (b) This page containing general instructions is not to be filed with the form. (3) Signature and Filing of Report (a) Five (5) complete copies of this document shall be filed with the Commission. At least one complete copy, shall, where any class of securities of the issuer is listed on a Stock Exchange, simultaneously be filed with that Stock Exchange. At least one complete copy of the report filed with the Commission and one such copy filed with the Exchange shall be manually signed. Copies not manually signed shall bear typed or printed signatures. (b) See also paragraphs 2 and 3 of SRC Rule 72.1 concerning copies, binding, signatures, paper, printing, language, and pagination. (4) Period Covered The assessment shall cover the period from January 1, 2003 to June 30, 2003. (5) Self-Rating Criteria The rating shall be from zero (0) to five (5), in accordance with the following criteria: Rating Description Zero (0) Leading practice or principle is not adopted in the company's Manual of Corporate Governance. One (1) Leading practice or principle is adopted in the Manual but compliance has not yet been made. Two (2) to Leading practice or principle is adopted in the Manual and three (3) compliance has been made but with major deviation(s) or incompleteness. Four (4) Leading practice or principle is adopted in the Manual and compliance has been made but with minor deviation(s) or incompleteness. Five (5) Leading practice or principle is adopted in the Manual and full compliance with the same has been made.