FILAMER CHRISTIAN UNIVERSITY

GRADUATE SCHOOL
AUTONOMOUS STATUS-CHED
Roxas Avenue, Roxas City 5800
Tel. No. (036) 6212-317 Fax No. (036) 6213-075

MBA 408: Business Policy

CARMEL GRACE B. LINGA PROF. VIOLETA BARREDO, CPA

MBA STUDENT COURSE FACILITATOR

CASE STUDY 6
Jaime Zobel De Ayala and the Ayala Corporation

Jaime Zobel De Ayala is the president and chairman of the Ayala Corporation. The said
$1.2B company is the holding organization for the following: Ayala Malls, Avida, Alveo, Ayala
Land, Ayala BusinessScapes, Ayala Hotels, Makati Development Corporation, Ayala Property
Management, Bank of the Philippines Islands, Globe Telecoms, Manila Water Company
(Maynilad), Integrated Microelectronics, Inc., Azalea Technology Investments, Inc., Ayala
Automotives Holdings, Inc. (Honda Cars Makati And Isuzu Automotive Dealership, Inc.), Ayala
International Pte, Ltd., Integreon Managed Solutions, Inc., Ayala Foundation, Inc., and
eTelecare.

Aside from his membership in the board of the Ayala Group of Companies, he is a
member of other international organizations: JP Morgan International Advisory Council, the
Mitsubishi Corporation International Advisory Committee, the Toshiba International Advisory
Group, the Asia Society, and the Asia Business Council.

As an alumnus of Harvard University, he is a member of the Harvard University Asia

Center Advisory Committee, Harvard Business School Asia Committee, and the Board of
Trustees of the Asian Institute of Management.

Jaime studies at Harvard University where he earned his BA in Economics (cum laude) in
1981 and his MBA in 1987.

Ayala planted the seeds of fruitful hard work and discipline coupled with sound
management principles as early as 1834.

In this kind of industry, perseverance and determination helped in the pioneering of real estate
development and banking in the country.

As a huge contributor in building the Philippine economy, Ayala fostered financial

strength, high product quality, and professionalism.

QUESTIONS TO ANSWER
1. What are the qualities of Jaime Zobel de Ayala which made him to pioneer in Urban
Development through real estate?

Jaime Zobel de Ayala is the Chairman and CEO of Ayala Corporation, one of the largest
conglomerate in the Philippines. And noting that Ayala corporation is also of the leading names
in real estate in the Philippines. In this competitive industry, one leading this type of
corporation must possess qualities that would enable him to lead such organization. Jamie
Zobel de Ayala has determination, perseverance, accountability, tenacity and a clear perception
of the needs of the people and incorporating it to the company’s growth. Ayala Land is a
leading organization which boasts it’s mission by developing integrated, masterplanned and
sustainable mixed-use communities in vibrant growth centers all over the country, and strive to
continually elevate the quality of life for all of their customers.

“For Asia 2025, an Asia House publication launched on March 8, the Chairman and Chief
Executive Officer of Ayala Corporation Jaime Augusto Zóbel de Ayala plh contributed his
thoughts on the challenges and opportunities for urban development in the Philippines.”

The sustained economic growth and urban sprawl have resulted in overcapacity in
infrastructure and increased vulnerability to disasters. However, population density per
se is not the problem. In addition to hard infrastructure, we need to ensure that the right
level of governance, urban management and planning is in place to support Metro
Manila. I believe there is need for the creation of a central institution that would
spearhead a cohesive and strategic planning and execution of a national urban agenda,
where clear accountabilities are defined. Second, there is a growing importance for
government and private sector collaboration to address some of the key urbanization
challenges, particularly in critical sectors such as infrastructure and shared value
creation.

As a final note, as this unprecedented positive environment taking place in the Philippine
economy is poised to continue in the next few years, it is imperative that we act together
to intensify our efforts to address the rapid urbanisation. I believe that to a large extent,
this entails collaborative efforts across multiple sectors – the government, the private
sector, the civil society, and multilaterals. This, combined with a healthy sharing of
expertise and best practice among peers, can well fortify our efforts in dealing with
urbanisation challenges.

2. Trace the various industries that Ayala ventured into through the internet. Trace the financial
strength, high quality and professionalism he has inculcated in these businesses. Make your
own comments on these.

Ayala Corporation as one of the leading conglomerate that has established their legacy
in so many industries. In relation to their vision of enabling shared values and prosperity
for the many stakeholders they serve and their mission that ensures to fulfil long-term
profitability and value creation, and with Ayala Corporation’s strategic management and
investment planning they ensure that these will be realized.

a. Real Estate: Ayala Land (49.5%)

One of the leading players in Real estate development industry in the Philippines. It has
engaged in various diverse projects from residential to commercial properties. Most
probably one of the most notable brands when it comes of real estate. Ayala Land
posted a net income of P403 million for the first quarter of 2021, 60% higher than last
year, driven by stable operations and the contribution of newly-acquired assets. With a
high occupancy rate of 99% and strong 95% collection rate, total revenues reached P608
million, 52% more year-on-year.

Ayala Land is also one of the main developers of Bonifacio Global City (BGC) and turned
it into an area most desirable for residents and business owners. Being one of the
leading companies in real estate, Ayala has shown it’s prowess in the real estate
industry

b. Financial services: BPI-Bank of the Philippine Island (48.5%)

BPI being the first bank in the Philippines established in 1851, it has established a brand
of trust in the Philippines. The second largest Philippine bank in terms of market
capitalization and the third largest when it comes to total assets. Being affiliated with
BPI during its establishment and eventually becoming the major shareholder and
eventually Ayala’s flagship of its financial entities, it gave Ayala a sense of lead when it
comes to this industry. With proofs of its years of service and experience in the industry
and how it was involved with several mergers and acquisitions of several banking
institutions.

c. Telecommunications: Globe Telecom (30.8%)

Globe Telecom, Inc., commonly shortened as Globe, is a major provider of

telecommunications services in the Philippines. The company operates the largest
mobile network in the Philippines and one of the largest fixed-line and broadband
networks.
Globe posted a Net Income After Tax of ₱34.6 billion in 2022, a 46% increase year-on-
year, while our consolidated EBITDA stood at ₱79.1 billion, 6% higher than in 2021,
enabling an overall healthy EBITDA margin of 50%.

The company's principal shareholders are Ayala Corporation and Singtel.

d. Energy: ACEN
 Formerly AC Energy, is the energy firm under the Ayala Group. One of the fastest
growing energy companies in the region and aspires to be the largest listed renewables
platform in Southeast Asia.
ACEN made initial investments in the power sector in the Philippines—an investment in
a wind farm at Ilocos Norte (Northwind Project), a stake in a CFB thermal power plant in
Batangas province (SLTEC), a second wind farm in Ilocos Norte (North Luzon
Renewables), a limited partnership in a coal-fired plant at Bataan and Lanao del Norte
(GNPower Mariveles), respectively, and a limited partnership in two supercritical coal-
fired power plant also in Bataan (GNPower Dinginin).
With ACEN and its mission in relation to renewable energy, it highlights Ayala
Corporation’s Social Corporate Responsibility towards its environment and its
constituents.

e. Electronics manufacturing, Automotive retail and enabling technologies: AC

Industrials

AC Industrial Technology Holdings Inc. or simply AC Industrials is Ayala Corporation's

holding company for its current and future investments in industrial technology. It is
formerly known as Ayala Automotive Holdings Corporation.

With three major business lines – global manufacturing, enabling technologies, and
automotive distribution and retail – AC Industrials seeks to develop, commercialize, and
scale up an integrated portfolio of businesses across the mobility, connectivity, and
smart energy spaces.

f. Non stock, non-profit organization: Ayala Foundation

As the social development arm of the Ayala group of companies, Ayala Foundation
envisions communities where people are creative, productive, self-reliant, and proud to
be Filipino. Ayala Foundation is committed to community development, working closely
with communities in identifying compelling developmental needs and providing suitable
solutions with measurable outcomes. Its programs are under the following thematic
areas—Education, Sustainable Livelihood, and Love of Country.

 Ayala Corporation’s history and diversity when it comes to companies and its industries
is strongly related to its corporate mission of anchored values of integrity, long-term
vision, empowering leadership, and with a strong commitment to national
development. They ensure to take into consideration the interest of its stake holders in
all industries they tackle which also relates to it’s mission of creating synergies as it
builds mutually-beneficial partnerships and alliances with those who share its
philosophies and values.