Church ownership of stocks
If an award were to be given for sound investment strategy in stocks, some Catholic archdioceses would be strong contenders for the citation.
In the wake of the Senate investigation on alleged unauthorized donations by the PCSO to some bishops for the purchase of utility vehicles, several archbishops were reported to own shares in Bank of the Philippine Islands, Philippine Airlines, San Miguel Corp. and Philex Mining Corp.
Aside from being blue chip and listed on the stock exchange, these companies have a common denominator—they are big names in their respective fields and whose growth is closely linked to our economic history.
Except for Philex, the rest of the stocks are believed to have been handed down from the Spanish friars who once controlled the country dioceses until Filipino priests took over in the 1960s.
The presence of the friars in the roster of stockholders may be attributed to the fact that these companies were started by Filipinos with Spanish parentage.
It made good business sense for the succeeding stockholders to keep the shares as their market value has risen exponentially in recent years.
Why sell when these companies are able to declare cash and stock dividends regularly, except during the times our economy was in bad shape.
Ownership
It is unclear though as to under whose names the subject stocks are registered. That of the incumbent archbishop, or the archdiocese that the archbishop heads?
If the stocks are in the archbishop’s name alone, title over them and the right to receive dividends, including the proceeds of their sale, rest with the archbishop concerned.
The stocks will be treated as His Excellency’s personal property which he can sell, alienate or convey as he may desire.
The story is different if they are listed as owned by an archdiocese that is registered with the Securities and Exchange Commission either as a corporation sole or an incorporated religious society.
Contrary to popularly held belief, an archdiocese or bishopric (or in the case of other religious sects, local or district) does not automatically acquire a juridical personality upon its organization.
That status may be gained only upon the issuance by the SEC of a certificate of incorporation to the subject religious entity or organization. It does not evolve, nor is it created, from long years of existence or continued public representation about its supposed legal personality.
The rules on acquisition of juridical or legal personality are defined by law and strictly applied because that status gives rise to certain rights, duties and responsibilities.
Organization
A corporation sole is “formed for purposes of administering and managing as a trustee the affairs, properties and temporalities of a religious denomination, sect or church that are derived from donations, collections and other similar sources.”
Unlike ordinary stock corporations that should have at least five incorporators, a corporation sole may be organized by the presiding elder of a religious denomination, sect or church, such as archbishop, bishop, priest, minister, pastor or rabbi.
Its Articles of Incorporation should contain, among others, its rules of discipline and the manner by which any vacancy in its top post shall be filled up.
Although a corporation sole’s leadership is singular in character, its head is, strictly speaking, “merely the administrator of church properties that come to his possession and which he holds in trust for the church.”
In recognition of the corporation’s “divine mission,” the law grants it the right to exist and operate perpetually unless it voluntary decides to dissolve itself.
Thus, once registered, the corporation sole will, as long as its rules on succession are scrupulously observed and its membership remains intact, continue to enjoy the benefits of its juridical personality.
In addition to that privilege, it is not required to separately file its by-laws as a condition for registration because its rules and regulations on discipline already serve the purpose of the by-laws.
Societies
If the faithful, however, are wary about their elder, pastor or what-have-you taking on dictatorial airs in a corporation sole arrangement, they can organize themselves instead into an incorporated religious society.
The right to acquire such juridical personality is available to religious societies or orders, dioceses, synods and district organizations of any religious denomination, sect or church.
In contrast to the corporation sole, this type of corporation is obliged to have at least five, but not more than 15, trustees in its board.
At least in theory, it’s the board of trustees, not just the supreme religious leader, that supervises the activities of the incorporated religious society.
Of course, it is common knowledge that when somebody thinks he or she received a message from God to preach His teachings, that “anointed” person makes sure that his or her hold over the faithful remains firm, regardless of the legal structure of their group.
In terms of existence, an incorporated religious society, like a corporation sole, has no term limit. Its juridical personality remains intact until its members decide to terminate its existence.
Understandably, to the unquestioning believer, his bishop, priest, pastor, minister or rabbi can do no wrong or that he will misappropriate the assets or money entrusted to him by the flock.
But as the political saying goes, trust but verify. Some men and women of the cloth have feet of clay too.
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