~=1=~-~ ===........,.,.~-~~ . . . .-====-==,:~-~~·=.,..,_.. -==~---===--'" =~=·= =- =·= =-= --·"-----"'·'-===-~~~ First, in discussing the challenges and recommendations on effectively redressing violation of stakeholders' rights, the SEC said: "With regard to relations with creditors, suppliers, and contractors, dealings should always be conducted in a professional and objective manner, in line with the Code of Ethical Conduct that the company has formulated and adopted. In the selection of suppliers and contractors, both economic and non-economic factors, such as environmental, social or human rights, should also be considered. Creditor rights should also be protected by adopting policies for their proper and fair treatment. " (Emphasis ours) Second, as regards the recommendations about company objectives and non-financial information that would enhance disclosure in annual reports, the SEC stated: "Information is not limited to financial matters. Company objectives, mission, vision, core values, and strategic priorities (which the Board review annually) as well as other non-financial information also need to be disclosed. In addition to their commercial objectives, companies are encouraged to disclose policies relating to business ethics, the environmen~ human rights, including where relevant within their supply chain, and other public policy commitments." (Emphasis ours) Nevertheless, the way the statements are phrased may give the impression of voluntary compliance rather than mandatory directive. At any rate, relevant to a discussion on corporate governance and accountability is an emphasis on the rule on summons under Philippine civil procedure. Rule 14, Section 11, of the Rules of Court requires that when the defendant is a corporation, partnership or association organized under the laws of the Philippines with a juridical personality, service of summons may be made on the president, managing partner, general manager, corporate secretary, treasurer, or in-house counsel. This rule on summons is important because a court of law generally acquires jurisdiction over the person of a defendant upon service of summons, and the cited procedure is pointing to such officers of a juridical entity for a valid service thereof. 66 On the other hand, when the defendant is a foreign private juridical entity which has transacted business in the Philippines, service may be made on its resident agent designated in accordance with law for that purpose, or, if there be no such agent, on the government official designated by law to that effect, or on any of its officers or agents within the Philippines. 67 Clearly, the current state of procedural law in fine print is dear as to how private entities would initially be held to account, and that is in so far as service of summons is concerned. As such, it is also important to note that Sections 127 and 128 of the Corporation Code require from a foreign corporation68 the appointment of a resident agent as a condition precedent for the issuance of the license to transact business in the Philippines. A resident agent may be either an individual residing in the Philippines or a domestic corporation lawfully transacting business in the Philippines. Particularly for an individual resident agent, good moral character and sound financial standing are required. Furthermore, the foreign corporation applying for license to transact business must execute and file with the Securities and Exchange Commission a written agreement or stipulation, executed by the proper authorities of said corporation, consenting that service of summons or other legal processes may be made upon the Securities and Exchange Commission if at any time the foreign corporation shall cease to transact business in the Philippines, or shall be without any resident agent. 66 ''The court's jurisdiction over a defendant is founded on a valid service of summons. Without a valid service, the court cannot acquire jurisdiction over the defendant, unless the defendant voluntarily submits to it. The defendant must be properly apprised of a pending action against him and assured of the opportunity to present his defenses to the suit. Proper service of summons is used to protect one's right to due process." (Manotoc vs. Court of Appeals, et al., G.R No. 130974, August 16, 2006) 67 Rule 14, Section 12, Rules of Court 68 Corporation Code, "Section 123. Definition and rights of foreign corporations. -For the purpose of this Code, a foreign corporation is done, formed, organized or existing under any laws other than those of the Philippines and whose laws allow Filipino citizens and corporations to do business in its own country or state. It shall have the right to transact business in the Philippines after it shall have obtained a license to transact business in this country in accordance with this Code and a certificate of authority from the appropriate government agency." 32