MANILA, Philippines — Makati Business Club chairman Edgar Chua has defended his nomination as independent director of Shell Pilipinas Corp. as concerns over corporate governance and the independence of board nominees have been raised ahead of the oil giant’s stockholders’ meeting this week.
“I take my election as independent director in any company very seriously. My actions ultimately are the true test of my independence,” Chua told The STAR.
He said his election as an independent director underwent a process of due diligence, legal and financial, among others.
He said the Securities and Exchange Commission (SEC) requires a cooling off period of two years before a former executive/officer or non-independent director can be elected as an independent director of the same company.
“I retired end-October 2016 but stayed as non-executive chairman until May 2017,” he explained.
Stockholder and independent director nominee Jordan Pizarras on May 7 formally asked the SEC to review what he described as “potential irregularities” in the listed company’s upcoming board elections on May 12, 2026.
Pizarras, a lawyer, expressed concerns over the nomination and possible election of Chua, a former Shell Pilipinas country chairman, as an independent director.
Chua served as country chairman of Shell in the Philippines from 2003 to 2016.
“This level of prior involvement in management creates a strong and continuing association with the company,” Pizarras said.
Pizarras claimed that Chua’s previous role as the company’s top executive could cast doubt on his ability to exercise independent judgment, a key requirement for independent directors under corporate governance standards.
Under existing SEC rules and corporate governance standards, an independent director must be free from any relationship that could interfere, or be perceived to interfere, with the exercise of independent judgment.
“In this case, Mr. Chua’s long tenure as a senior executive may reasonably be viewed as impairing such independence. The issue is not only actual independence, but also the appearance of independence,” Pizarras said.
In his letter, Pizarras also questioned what he described as a potential conflict of interest in the nomination process itself.
Citing details from the company’s information statement, he said Chua is a member of the nomination committee, which is responsible for screening and endorsing board nominees, and is also a nominee for election as an independent director.
“This suggests that he effectively participated in the nomination process that led to his own endorsement; in other words, he nominated himself,” Pizarras said.
“This creates the anomalous situation where a nominee participates in the evaluation process that determines his own eligibility. While this may not be expressly prohibited, it raises serious concerns about conflict of interest, as well as the objectivity and integrity of the nomination process,” he said.
The STAR reached out to Shell Pilipinas for comment, but it has yet to provide a response.