The Securities and Exchange Commission (SEC) said Wednesday it is working to rebuild investor confidence after a flood control project scandal wiped out P1.7 trillion in market value of listed firms over the past three weeks.
SEC chairman Francisco Lim said the recent sell-off was not due to the poor earnings of listed companies but to a deeper breakdown in public trust.
“Investors aren’t fleeing because of weak fundamentals; they’re fleeing because of weak integrity. It’s a stark reminder that corruption is a weapon of mass wealth destruction,” Lim said in a speech during the 57th Annual FINEX Conference in Makati City.
The Philippine Stock Exchange Index fell to as low as 5,905 in September following the flood control scandal.
The SEC warned that the situation reflects a broader crisis of confidence in the capital markets. “Our stock market is a laggard. Sadly, this reflects something deeper — a crisis of confidence,” said Lim.
“This is not just a market issue. It’s a trust issue and rebuilding that trust is one of the SEC’s most urgent missions,” he said.
To restore trust, the SEC is strengthening corporate governance through tighter rules for independent directors, making Real Estate Investment Trusts (REITs) more accessible, reforming the Personal Equity and Retirement Account (PERA) and pushing for financial literacy to be taught in schools.
“Each reform we make is a promise that trust will again be our strongest currency, and that every Filipino, not just a few, will share in the nation’s growth,” Lim said.
The upcoming reforms include expanding access to capital, enhancing investor protection, modernizing regulation through digital innovation and strengthening the institution’s internal capacity.
“When markets are trusted, capital flows. And when capital flows, the economy grows,” he said.
The SEC earlier reduced by 50 percent the fees to access SEC corporate disclosures, offered discounts on registration and capital increase fees for micro, small and medium enterprises and implemented a policy where applications are deemed approved if the SEC does not act within the set timeframe. It also expanded the OneSEC digital platform and launched the Philippine Green Equity Guidelines, the first in Southeast Asia, to promote sustainable investments.
