Last August 31, the Shareholders’ Association of the Philippines (SharePHIL) held its 4th annual summit at the Dusit Hotel in Makati City.
The summit featured the famous brothers of the Ayala Group, Jaime Augusto and Fernando Zobel de Ayala.
The occasion was a rare feat for any organization: It was the first time the Zobel brothers spoke jointly as principal speakers in one forum. SharePHIL was indeed honored by this distinct privilege.
What was highlighted by the broadsheets and television networks after the summit was the political dimension (unintended) of the summit, i.e., the Zobel brothers’ response to a hypothetical question from the floor on what they would do to get their “dream Philippines” if they were elected president of the country.
Their answers were honest and down to earth: 1) strengthen trust in the government; 2) improve the rule of law, which is so fundamental to make our society functional and productive; 3) develop a robust and progressive educational system to enable our country to survive a world that is rapidly changing; 4) a long-term vision that sees well beyond the six-year political cycle of the country; and 5) more inclusive economic growth to make it more impactful to more Filipinos.
The brothers shared with the audience values that helped the Ayala group survive 183 years of turbulent Philippine history and become what it is today. Among them were: (a) ensuring the next generations know they are not merely owners, but also stewards or fiduciaries; (b) making the family members understand that they will not be awarded a position as a matter of birthright or entitlement; (c) there is a distinction between the “business of business” and “business of family” and there must be sharp focus on quantifiable results and metrics; (d) a family-controlled corporation is not contradictory to a “professionally managed” business; (e) inculcating in the members the value of family unity and stability, which are critical for business continuity; (g) the Philippines has given the conglomerate a platform for growth and the Ayala group should continue to play a key role in the country’s development; (h) good corporate governance enables companies to attract and maintain the best talents and partners; (i) combination of knowledge, experience and expertise at the board level to address market challenges and opportunities; (j) use of transparency as a strategic mechanism to drive competitiveness and long-term growth and value rather than viewed from a mere compliance standpoint; and (k) benchmarking the conglomerate’s corporate governance standards against metrics set by the international community.
We all know that businessmen can portray themselves as having adopted the same principles. It is easier said than done, though.
From SharePHIL’s standpoint, what was more impressive was that these values were amply demonstrated through the years in a country dominated by family businesses and where good corporate governance is mere lip service.
We at SharePHIL earnestly hope our public companies will learn from the Ayala group. By doing so, our companies will create and sustain value for their shareholders.