Lopez Holdings


Keynote Remarks of Lopez Holdings chairman emeritus Oscar M. Lopez at the 3rd Annual Summit of the Shareholders’ Association of the Philippines on June 17, 2016
Mayuree Ballroom, Dusit Thani Manila Hotel, Makati City

Directors and Officers of SharePhil,
Ladies and Gentlemen:

A very good afternoon to all of you.

The Lopez Group of Companies, such as it is today, was first established on June 12, 1928 as a dual proprietorship by my father, Eugenio Lopez, Sr. and his brother, former Philippine Vice President Fernando Lopez. It was called E & F Lopez, Inc. Particularly after the Second World War, my father largely took charge of business affairs while my uncle dedicated his life to public service. All the risks and fruits of their businesses were shared 50-50 between them through the next 47 years, till my father passed away. The Lopez Group of Companies today pertain to the Eugenio Lopez, Sr. side of the family.

My father was one of the leading business figures of his generation. He established his reputation as a leading entrepreneur, first in Iloilo City, then in Manila.

In Iloilo, apart from managing inherited and acquired properties and sugar farms, he pioneered in air, land and sea transport, newspaper publishing, movie theaters and ice cream making, among others. He quickly understood that he could not build a business empire based on the planting of sugar, subject to vagaries of weather and international pricing that he had no control over. Rather, he had to invest in businesses where advancements in technology gave him an edge. This was especially true in the case of aviation industry, where he invested in opening the first inter-island airline, ‘Negros Air Express’ or INAEC.

The Second World War destroyed all these businesses, but my father was undeterred. After the war ended, he concentrated on building new businesses, this time centered in Manila. Initially, he went back to the businesses that he knew – newspaper publishing, through the acquisition of Manila Chronicle, and air transport, through the establishment of Far East Air Transport Inc. or FEATI, the Philippines’ first airline, antedating Philippine Airlines in the postwar era. Then, with the acquisition of Binalbagan-Isabela Sugar Company, he led the formation of a powerful coalition of sugar millers across the country.

But his greatest successes were yet to come. At the urging of my brother Geny, he started investing in media companies, first with the establishment of Chronicle Broadcasting Network for radio in 1956, followed by the acquisition of Alto Broadcasting and Monserrat Broadcasting for television in 1957. In 1967, these merged to become ABS-CBN. Then, his pursuit of Victorias Milling in 1960 instead led him to the chance to acquire Manila Electric Company in 1961 from its American owners. It was for his leadership of Meralco that he is best remembered today.

My father was known for the force of his personality and ideas. He placed his newspaper publishing business, and later his media assets, not at the service of his businesses, but at the service of his ideas and principles. He was not attached to wealth as his sole objective in life, and therefore never hesitated to take on a cause or advocacy that he believed in, even if it meant banging heads with those in power. He understood that if you were in the newspaper publishing business, you were in politics, and he relished playing that game as much as he relished building his businesses.

Throughout his life, he demonstrated a strong nationalist sentiment, something he had in common with, and served as basis of his deep friendships with, other renowned nationalists like Claro M. Recto and Manuel L. Quezon. He believed that Filipino managers, with the proper education and training, were the equal of anyone in the world. He was a product of Ateneo, U.P. College of Law and Harvard Graduate Law School. He was a major sponsor and contributor to the establishment of the Asian Institute of Management.

My father was never reluctant to pioneer in businesses that had previously been reserved for the colonial masters, such as air transport and power generation and distribution. There were a number of things he was very particular about. He believed that the foremost objective of his businesses was to serve the public good, and the Lopez companies today continue to ascribe to the motto “In service of the Filipino people”. He was also averse to borrowing from government institutions.

For our purposes today, I suppose it helps that my father was quite influential and charismatic, because many of his letters, memoranda and speeches have been recorded and preserved. Through them, we have a window into the principles he valued and stood for. Let me cite a few from speeches he made on various occasions at Meralco, and I quote:

“…We believe that the growth of a company should run parallel with the progress of the community, and we further believe that part of the earnings of a corporation should be returned to the public in the form of charity, civic projects, and community service, and that a company that fails to do this does not deserve public support.”

“The company must make profits, yes. But a good portion of this must be returned to the public… A company cannot be called progressive if it accumulates only profits, with utter disregard to its moral and social obligations to the public and its employees. A company of that kind cannot and should not deserve the support of the public.”

Finally: “We maintain that in case of doubt in a controversy arising between labor and management, this doubt must always be resolved in favor of labor. We further maintain that human values are above and far superior to material values … The company that is prosperous and rich while labor lives in misery has neither the right to exist nor the right to claim public support.”

Not too long ago, we distilled our collective memories of my father’s lifetime as founder and leader of the Lopez Group into a statement of The Lopez Values, as follows:

“In our service to the Filipino people, we will be guided by the following distinct Lopez values:

  • A pioneering entrepreneurial spirit
  • Business excellence
  • Unity
  • Nationalism
  • Social justice
  • Integrity
  • Employee welfare and wellness

We know from generations of experience that it is by living according to these values that a company can be built to last.”

Each Lopez Group employee is provided these values and a statement that we call “The Lopez Credo” on a plastic card that they are encouraged to carry with them at all times, and we take every opportune corporate occasion to recite our credo and values together, as members of one unified corporate family.

We are now into our third generation of Lopez leaders in our group. My father and his brother were the first; my brothers Geny, Manolo, Robbie, my sister Presy, and I were the second; and now Gabby and Piki and their siblings and first cousins are the third. Jamie, Gabby’s son, is the first of the fourth generation to be employed in our group, and he certainly won’t be the last.

We may well ask: are the values we inherited from my father still relevant today? I would argue that they are every bit as relevant today as they were in the fifties and sixties. Perhaps more so, as we safeguard the freedoms we lost during the martial law period and regained after the EDSA revolution, and as we strive to bring the Philippines into the global economic mainstream.

What you have to understand is that the businesses that we returned to after the end of martial law, after they had been taken from us by the dictatorship, were like the rubble of Intramuros after the Second World War. Worst than that, my father died in San Francisco in 1975 mainly as a result of the harassment given him by the Marcoses regime to give up his properties during that martial law years. My brother Geny was imprisoned for more than 5 years and used as a hostage until he made his escape together with Senator Serge Osmeña and they flew to the U.S. and all of us children were robbed of close to 15 of our most productive years by the martial law era. These businesses were in terrible shape and many were virtually bankrupt. It wasn’t as if they were restored to us in good condition. Worse, we had to fight to regain ownership and control, from the government, from creditors and from the usurpers including up to now. We had to rebuild. So things were very much like they were during my father’s prime before martial law, and we had to fall back on the same values and principles to carry us through. Some things did not change. Less than ten years ago, we fought a losing battle to protect our ownership control of Meralco against a presidency determined to take revenge on us because ABS-CBN had revealed for all the world to see how they had stolen the presidential elections. So you see, even today in this period of plenty and optimism, the barbarians are always at the gate.

Do we attribute specific interpretations to our corporate values today that are different from those during my father’s era? I would say interpretations, not so much, but points of emphasis, certainly. For example, today, environmental consciousness and responsibility are much more a part of business excellence, as is good and transparent governance.

And so we come to the question – what happens to the values moving forward? I believe that part of what makes the DNA of the Lopez companies is the DNA of the Lopez family. For as long as there are qualified Lopez family members who can serve as leaders of our businesses, then there will be a sense of constancy and continuity in our values. Note that I emphasize the word qualified. For to be qualified to lead our major businesses, a person would have to have the talent, the vision, the discipline, the education, the training and preparation, the experience. The talent, you have to be born with. Everything else, you need to work hard to develop and acquire. It took Piki the better part of thirty years to do so.

And, therefore, it is with great pride, pleasure, and, I assure you, relief, that I now turn the discussion to his care. I do believe that he will now have much more influence than I, on how our corporate values will continue to evolve.

Thank you, and again, a very good afternoon to you all.

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Lopez Holdings Corporation 
16/F North Tower, Rockwell Business Center Sheridan, Sheridan St. corner United St., 1550 Bgy. Highway Hills, Mandaluyong City, Philippines

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