Point of Law

Francisco Ed. Lim

If one of the Zobels led PH

Francisco Ed. Lim

September 26, 2017

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.