THE 175-YEAR-OLD AYALA conglomerate is recalibrating its group-wide business model to make a more significant contribution to society, alongside the traditional goal of sustaining growth and profitability, thus raising the bar for all corporations in the country.

In a press briefing Wednesday, Ayala Corp. chair and CEO Jaime Augusto Zobel de Ayala and president and COO Fernando Zobel de Ayala vowed that under their leadership, the group would pursue more aggressively the so-called “triple bottom line” approach—referring to impact on profit, people and the planet—in measuring corporate success.

This year, six publicly listed companies of the group—Ayala Corp., Ayala Land Inc., Cebu Holdings, Bank of the Philippine Islands, Globe Telecom and Manila Water Co.—published reports for 2008 utilizing the global reporting initiative (GRI) reporting guidelines.

This is the first time that a Philippine conglomerate has published this kind of report for itself and all of its main business units.

The group is also holding a “Sustainability Summit” on Nov. 10 to provide direction and additional impetus for its companies to make significant adjustments to their strategies, business models, products and operations.

“The sustainability report is widening the framework so that on the economic front, we’re saying it’s not just about profits. It’s also about employment statistics; it’s about the taxes we pay, the capital expenditures and investments we’re making. That’s one component,” Jaime Augusto, the elder of the Zobel siblings, said.

“The second is the social impact, how we’re affecting communities and finally there’s environmental impact. We’re taking this new way of looking at the business engagement and it deserves its own report,” he added.

Eleven indicators covering economic performance, indirect economic impact, energy consumption, water use, emissions and waste, products and services, employment practices, education and training and product responsibility are covered in the report, which complies with the level “C” application of the GRI guidelines.

“Businesses are talking beyond more than just mere governance and are starting to talk about what their footprint is in society,” said Fernando, the younger Zobel.

“For a very long time, businesses have focused only on profitability and growth. What you’re gonna see is a more balanced approach to growth,” he said.

The approach, thus, goes beyond mere corporate governance reforms or project-specific corporate social responsibility activities as it incorporates the building of viable enterprises out of deeper social involvement.

Two key examples cited during the press briefing yesterday were the Ayalas’ venture into the water distribution business via Manila Water as well as the recent launch of the first mobile microfinance bank “BPI Globe Banko, A Savings Bank.”

Citing the case of Manila Water, the younger Zobel said: “It’s a business we’ve never been into and was an opportunity to move into an industry that was very inefficient but was a basic need. And it has been profitable for us. It had been very revealing and a great learning process.”

He added that Manila Water was able to come up with a pricing structure that would sustain the business while making it affordable to even the poorest communities to have access to reliable supply of water.

He also noted that Manila Water was now starting to go into waste treatment in order to address environmental issues, without having to wait for any state intervention to clean up the Pasig River, for instance.