Lopez Holdings

Keynote Remarks by Oscar M. Lopez, Chairman Emeritus of the Lopez Group of Companies
August 22, 2013
Building Critical Mass Awareness of Climate Change Seminar help at Asian Development Bank, Ortigas Center

Mr. Leon G. Flores III, Undersecretary and Chairman and CEO of the National Youth Commission, Officers and Representatives of the National Youth Commission, the Swedish International Development Corporation, the Asian Development Bank and The Media Alliance, Delegates and Guests, Ladies and Gentlemen, And most particularly, those of you here today who represent the Filipino youth:

Good Morning. I am deeply honored that you have chosen me to deliver the keynote remarks for this most timely and important dialogue.

We are all here today to build critical mass awareness of climate change. Climate change, and its associated topic, global warming, are a broad and complex subject matter. We are, therefore, fortunate to also have with us today technical and scientific experts who can help us understand their impact on our environment and on our lives.

I suppose that, if we were not an island archipelago and if the majority of Filipinos did not live in the strips of littoral lying between our mountains and the sea, vulnerable to flooding, then we might not have to be as worried about climate change and its consequences. Or that if many parts of Metro Manila were not at, or below, sea level, then we should not be as worried about the rise in sea levels. But we would be wrong not to worry even if we were not in what some may regard as a geo-hazard zone. Today major floods occur and recur in many of the world’s large river systems, often as far away from the ocean as anyone could possibly be. Even in mountain ranges like the Himalayas and the Pyrenees, excessive rainfall has caused significant flooding. We are constantly reminded that nobody is spared from the often disastrous effects of climate change.

There are many things that can cause and influence changes in climate, but for our purposes today, suffice it for us to understand the term “climate change” in a rather basic, straightforward way, namely, “changes in the earth's weather, including changes in temperature, wind patterns and rainfall, especially the increase in the temperature of the earth's atmosphere that is caused by the increase of particular gases, especially carbon dioxide.”

You may well ask: what qualifies me to speak on the subject of climate change, particularly when we have experts among us. After all, insofar as this particular subject is concerned, like you, I am just a typical citizen with everyday concerns.

Well, perhaps “typical” is not the right word. For many years, as Chief Executive Officer of the Lopez Group of Companies, I was the principal steward of our businesses, and like other heads of the Lopez businesses before me, businesses heavily affected by weather, I have long been acutely aware of how our climate behaves and has changed. First, we were in large-scale sugar farming. Then, we became the largest private electric utility in the country. On the power generation side, we saw the effects that logging and the destruction of our watersheds had on the performance of the country’s major dams and hydroelectric power plants. In the 1950’s and 1960’s, we had to wean Meralco away from the hydro-electric power sources that it had traditionally relied upon. On the power distribution side, our crisis events always involved major typhoons. More recently, as we have concentrated on large-scale power generation from, among other sources, hydroelectric, geothermal, and soon, wind, our businesses are again heavily affected by weather-related factors and events.

As a result, many of our major corporate initiatives proactively try to influence the environment and its impact on our business operations. In 1987, we undertook our first large-scale reforestation project in Sacobia, Tarlac, under the funding sponsorship of the US Agency for International Development, or “US AID”. We replanted 1,000 hectares of barren mountain slopes with indigenous tree species, a large proportion of which comprised increasingly rare Philippine hardwoods. So successful was this project that we then looked for another one that would be much larger in size and scale.

Unfortunately, we could not find a project that could sustain itself financially without external funding support. We discovered that for all the benefit that reforestation can bring to the country, there are sectors of our society adversely affected by it – not major loggers, but the many poor or marginalized who eke out a living by cutting down a few trees or doing slash-and-burn farming. At the local level, there is a political price to be paid for regenerating and protecting our forests, and the LGUs are often unwilling to pay that price. This was a valuable lesson learned.

So we turned our focus on a related subject, biodiversity, and the fact that the Philippines is recognized as one of the major biodiversity hot spots in the world. My association with Conservation International led me to visit our remaining patches of virgin rain forest, often in the inaccessible areas of Isabela and Aurora, and to a friendship with the late Leonard Co. Walking the forest with Leonard was like taking a Masters course in nature and conservation. Where possible, like in our family-owned farms in Guimaras Island, we planted tens of thousands of mango and hardwood trees, what I refer to as our investment for our future Lopez generations.

Other members of the Lopez Family have pursued similar environmental advocacies. My son Federico, now Chairman and Chief Executive of the First Holdings Group, has long actively supported the Verde Passage Conservation Program and has taken my place at Conservation International. My niece Gina is well known for her leadership in such projects as the rehabilitation and protection of the La Mesa Dam watershed and the cleaning up and de-clogging of parts of the Pasig River, among others.

Fortunately, when we won the privatization of Energy Development Corporation, we became inheritors of what is probably the most extensive, continuing reforestation program in the country today, the answer to my dreams. Preserving and prolonging the productive lives of the geothermal fields upon which EDC’s core geothermal power business is built requires that we conserve the forest watersheds in which these fields are located. The earth’s mantle provides the heat for geothermal energy, but the watershed provides the water that is converted to the geothermal steam that we extract to generate power. “BINHI”, as the program is called, has already succeeded in reforesting close to 11,000 hectares of open and denuded land, supported by company nurseries with an aggregate capacity of more than one million seedlings, among them, many endangered hardwood species native to our forests. With each passing year, more hectares are reforested.

As we’ve learned, forests are nature’s carbon sinks, its means of scrubbing carbon dioxide from our atmosphere, thereby neutralizing the greenhouse or global warming effect. In regenerating our forests, in planting trees, we contribute to this process. But the process is infinitely slow, compared to the rate at which mankind is currently generating greenhouse gasses. And as we’ve also learned, the Philippines releases an insignificant percentage the greenhouse gasses compared to that generated by industrialized countries. So even if we were carbon neutral as a country, which we are not, we would not be able to arrest the current pace of global warming and of climate change.

The weather-related natural disasters we’ve suffered during the past several years told us that it was not enough to merely exercise environmental responsibility. Every year, we’ve had to spend large amounts of money repairing damage to our assets by flooding, landslides, soil erosion and high winds. Every year, we’ve had to spend large sums in contributing to disaster rescue and relief operations for victims of natural disasters in and close to our areas of operation.

To avoid having to incur these costs repeatedly, we have endeavored to relocate our people and our assets to safer ground. But how about the majority of the people, the other affected communities? Unlike equipment and facilities, communities cannot be easily transplanted. They are tied to locations from which they grow, catch, produce, or otherwise earn their sustenance. If they are in harm’s way, where will they relocate and who will take care of their needs?

We began to focus on just one aspect of the problem: how do we generate better and earlier forecasts of weather and geologic events so that we could, in our businesses, act to mitigate the resultant risks, and outside our businesses, so that we could warn communities earlier to move themselves out of harm’s way? In the process of looking at the problem, we discovered two things: first, considering that we are one of the countries most affected by climate change and geo-hazards, being in the so-called “ring of fire” and right smack in the inter-tropical convergence zone, very little research was being done and published on how to mitigate the risks to our people and property. Second, even where we had expertise and resources addressing the issues, there was not much collaboration and dialogue going on between them.

There was already another initiative, “Project Noah” addressing the issue of providing earlier and more accurate forecasts of excessive wind and rain, to supplement the work done by Pagasa. We thought that we could best contribute by providing a meeting place, whether physical or virtual, where research could be encouraged and where the fruits of research could be shared, discussed and translated into effective interventions. And so, begging your indulgence for oversimplifying what actually happened and pressing the fast-forward button, thus was born the OML Center. It is named after me, to honor my stewardship of the Lopez businesses before I retired into the role of Chairman Emeritus. It is a partnership between the First Holdings Group of Companies and three of the country’s leading learning and research institutions: the University of the Philippines, Ateneo de Manila University and De La Salle University.

We looked near and far for the right person to head the OML Center as Scientific Director, and we found him in the person of Dr. Rodel Lasco. Our conference hosts today have very kindly agreed to allow Dr. Lasco to deliver a brief presentation of the OML Center, what it does, what its mission and objectives are, and what it has accomplished so far. With your indulgence, I will leave it to Rodel to talk about the OML Center. Suffice it for me to say that, in my view, the center has accomplished so much in such a short time and has exceeded all our expectations thus far, so much so that we are very excited about the contributions that it will make to our manner of coping with climate change in the future.

By way of a brief introduction, Dr. Rodel D. Lasco has nearly 30 years of experience in natural resources and environmental research, conservation, education and development at the national and international level. His work has focused on issues related to natural resources conservation, climate change and land degradation. He is a member of the IPCC, the 2007 co-winner of the Nobel Peace Prize. Dr. Lasco is the Philippines Coordinator of the World Agroforestry Centre since April 2004 and concurrently, the Scientific Director of the OML Center. He is also a member of the National Academy of Science and Technology (NAST) in the Philippines.

In ending, I would like to recall a plea that went out to the world almost fifty years ago, to help save animals inhabiting a section of rainforest in Central America that was about to be inundated by a hydroelectric dam project nearing completion. The simple call went out to the world: “Time is short, and the water rises.” That plea resonates just as loudly today, but this time, it is a plea that goes out to our people, to get themselves out of harms way.

Thank you and I wish you a fruitful, exciting conference. The doors of the OML Center are open to all of you.

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