Trust in action: The SEC’s firm and future-focused agenda for 2026

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(Part 2)

In the first part of this series, we examined the SEC’s aggressive push to lower the cost of doing business and streamline the “One SEC” digital registration system. But as any investor knows, efficiency means little without trust.

As we look ahead to 2026, the focus shifts from how we trade to why we trust the market. The second half of the SEC’s strategic roadmap focuses on the “Firm” and “Future-Focused” pillars – strict regulatory fidelity, judicial reform and the integration of next-generation technology.

Firm enforcement: Building predictable and fair markets

“Market integrity is very important to me, at least for the capital markets. Market discipline. That can extend to the nation. Kung may discipline lang tayong lahat, things would have been very different,” said SEC chairperson Francis Lim.

At the core of the “Firm” pillar is the belief that investor confidence hinges on predictable, consistent and fair enforcement of rules. Lim has made it clear that exemptive relief – a mechanism for companies to gain exceptions from certain regulatory requirements – will remain the exception rather than the rule.

“Exemptive reliefs, which are exemptions from complying with the law, will be few and far between… We’re not prohibited from granting exemptions for as long as there is a compelling reason. So that’s fair and reasonable,” Lim said, noting that several applications have already been denied to preserve the principle that the rules, not exceptions, govern the market.

Lim also emphasized the importance of balancing enforcement with ease of doing business. “Compliance is an enforcement issue. ‘Yung registration iba. I know it’s good to make payment of penalties, to collect payment, but they should not stand in the way of ease of doing business. Enforce it, but in the meantime, allow it. Kung hindi naman egregious ‘yung penalty, why should it stand in the way in terms of making the registration process easier?”

Judicial reform and market discipline

A key extension of the “Firm” agenda is judicial reform. Lim, who previously chaired the Justice Reform Initiative, has highlighted the importance of expediting the court system to prevent prolonged cases from undermining market trust.

“That’s one reason why I’ve been chairman of the Justice Reform Initiative… to expedite the court system because… the court system is a vital part of capital market development and market discipline,” he explained, referencing long-standing cases of corporate fraud such as Calata.

The SEC recognizes that robust enforcement cannot occur in isolation, with Lim noting that effective prosecution and timely resolution of cases underpin a credible market.

Lim stressed that investigators at the Department of Justice are now well-equipped, but external dependencies remain.

Encouraging local listings and market depth

Lim has also consistently advocated for companies to list domestically rather than seeking foreign exchanges.

“For me, you have to list in your home country, so we can properly guide you… There’s enough liquidity here. If the company is really attractive, they would do well in this market rather than go elsewhere to list, but that’s a business decision of the board, and we have to respect it.”

This emphasis on domestic listings ties directly to Lim’s broader goal of deepening the Philippine capital market. By liberalizing listing rules and providing clear guidance, the SEC hopes to reduce barriers for companies while simultaneously protecting investors through transparent disclosure.

Lim noted the shift introduced by the Securities Regulation Code from merit-based to disclosure-based regulation, while acknowledging that court interpretations have created a hybrid approach.

“Let the market decide, for as long as there’s fully accurate and not misleading disclosure… You have to disclose properly, fairly, completely, but there is also that rule that disclosure should not be misleading.”

These measures aim to make local listings more attractive, reduce regulatory ambiguity and allow investors to make informed decisions – foundational elements of a trustworthy market.

Future-focused: Technology, sustainability and financial literacy

Looking forward, the SEC is embracing next-generation technologies to support market integrity and sustainability.

Lim mentioned plans to integrate artificial intelligence in regulatory functions while cautioning against misuse: “On artificial intelligence, we will definitely make use of it. That’s already part of the plan, but we have to be careful… Beefing up, we have a lot of plantilla… Let’s try to automate everything.”

Sustainability is another pillar of the SEC’s forward-looking agenda. Lim emphasized the need to monitor greenwashing while supporting genuine ESG initiatives: “Sustainability is very important to us, and we’re also aware that there’s greenwashing. We’re watching that… Global investors look at how we do our sustainability things. It’s one way of making a stock market more attractive even to those global investors that are strong in sustainability targets.”

In tandem with technology and sustainability, Lim has advocated broader financial literacy to cultivate a culture of informed investing. He has long championed mandatory financial education for senior high school and college students, noting its potential to build long-term investor confidence.

“Mahirap ‘yung learning it on the job. There should be basics muna. I think it will help a lot when we are able to have financially literate students graduating from college.”

Operational streamlining and shared responsibility

The SEC is also working behind the scenes to remove operational bottlenecks that hinder market activity. Lim described the development of a tracking system to manage workloads and applications, a process he called “a work in progress.”

Moreover, he has pushed to streamline pre-clearance and monitoring, ensuring that only justified requirements remain in place.

“That will be part of the streamlining process. For as long as we list the requirements and the requirements are complete, we will deem it accepted. But I think the challenge there is… if you cannot justify that particular document that we are requiring, let’s remove it because the mere fact that you cannot justify it means it’s not important.”

Lim repeatedly underscored that market development is a shared responsibility: regulators, the private sector, government and investors all have roles to play.

“We will try our damn best in the SEC to move things, but we cannot do it alone. It should be a shared commitment… Let’s just help each other. I think things will happen. I have seven years to do it.”

A holistic vision for 2026

By combining firm enforcement, judicial reform, domestic market focus, technological integration, sustainability and financial literacy, the SEC is charting a comprehensive path for 2026. These initiatives aim not just to streamline processes, but to embed trust into the very fabric of the Philippine capital market.

As Lim observed, small details accumulate over time and shape investor perception.

“Our capital market is like this because we have done little things we were not supposed to do, and we have not done little things we were supposed to do. If I were an investor, and small important things aren’t done in the Philippines, why should I entrust my money there?”

For 2026, the SEC’s “Firm” and “Future-Focused” pillars signal that the agency is determined to ensure that trust, transparency and forward-looking governance are no longer optional – they are central to the Philippines’ vision of a modern, resilient and globally competitive capital market.

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