Finance Secretary Ralph G. Recto has lauded the Governance Commission for Government-Owned and Controlled Corporations (GCG) for raising the bar of corporate governance in GOCCs, transforming them into profitable partners in national progress through sustained dividend remittances.

“I directly benefit from the rigorous standards and performance measurements established by the GCG for our GOCCs. Because of its Corporate Governance Scorecard and Performance Evaluation System, we no longer operate in the dark,” Secretary Recto said in his remarks during the GCG Awards Ceremony on November 25, 2024, which was delivered by his Chief of Staff and Undersecretary Maria Luwalhati Dorotan Tiuseco.

As Finance Secretary, Recto sits as an ex-officio member of the GCG, the chairperson of six GOCCs, and a member of the Board of Directors of 22 state corporations.

“We have the clarity, the metrics, and the discipline to push our corporations to work harder and to perform better for the Filipino people. And not only are our GOCCs now fulfilling their unique missions effectively, they have also become profitable partners in national progress by contributing more of their earnings to the government in the form of dividends,” he added.

The GCG’s Corporate Governance Scorecard (CGS) evaluates the GOCCs, using a methodology that is benchmarked against globally accepted standards and practices.

It checks the GOCCs’ policies, initiatives, and practices in terms of stakeholder relationships, disclosure and transparency, and board responsibilities and whether they adhere to the best practices and international standards of corporate governance.

Meanwhile, the GCG also institutionalized the Performance Evaluation System (PES) to enable GOCCs to become performance-driven corporations. It appraises the accomplishments of GOCCs in the given fiscal year based on set performance criteria, targets, and weights.

Since then, the GCG has conducted an annual awards ceremony to recognize the top-performing GOCCs in the CGS and the PES.

These reforms were just among the many that were introduced since the creation of the GCG in 2011 through Republic Act No. 10149 or the GOCC Governance Act, which brought order into what was once a largely unregulated sector in the government.

“We all remember 2011 as a major turning point for the public corporate sector. The GOCC Governance Act —which I staunchly supported as a Senator—was brought to fruition to instill accountability, transparency, and purpose in a sector that once operated in the shadows,” the Finance Chief said.

Secretary Recto also pointed out that despite the smaller number of GOCCs compared to 2011, the country is now reaping greater rewards due to better governance.

Since the creation of the GCG in 2011 to 2024, the government has received an average of nearly PHP 56 billion in dividend remittances annually.

The amount is five times more than the average annual remittance of GOCCs from 2002 to 2011 of only PHP 11 billion.

As of October 2024, 52 GOCCs already remitted PHP 95.90 billion in dividends, 51% higher than in the same period last year.

This year, the Department of Finance (DOF) raised the mandatory dividend remittances of GOCCs to the National Government to 75% of their annual net earnings from 50% to accelerate the country’s growth.

GOCC dividends form a major source of non-tax revenues for the government, allowing it to raise more funds without the need to impose additional taxes on the people.

In effect, these additional revenue sources help the government hold down deficits and continue funding the President’s priority programs for the welfare of all Filipinos without having to borrow more.

“This clearly tells us that when we enforce greater transparency and accountability, we do not just strengthen our institutions. We are not just providing more money to the government. But we are delivering more hope, progress, and opportunities to every Filipino,” Secretary Recto said.

The Secretary particularly commended the Land Bank of the Philippines (LANDBANK) for remitting an unprecedented PHP 32.12 billion in dividends to the government in 2024––the highest in its history and among all GOCCs for the year.

In 2023, LANDBANK also garnered the highest rating for corporate governance and was recognized as one of the top-performing GOCCs.

Meanwhile, the Secretary expressed his support for GCG’s current initiative to ensure that women hold at least 30% of the seats on the boards of GOCCs to diversify leadership and allow them to play a bigger role in achieving sustainable development and social equity.

The Finance Chief likewise reminded GOCCs to reaffirm their shared responsibility to do more for the benefit of the Filipino people.

“Ineffectivity and inefficiency are forms of corruption. When we do less of what is expected of us, we rob our people of what they rightfully deserve,” he stressed.

“So let us not rest on our laurels. Let us not be satisfied. Let us strive for more. Let us aim higher. Let us deliver more. Because the Filipino people deserve nothing less, and we are more than capable of giving them the best,” Secretary Recto added.

Executive Secretary Lucas P. Bersamin and GCG Commissioners Atty. Brian Keith F. Hosaka and Atty. Geraldine Marie B. Berberabe-Martinez were present during the event.