A Journey in Corporate Governance Leadership

Directing and driving BDO Unibank’s success are its people, whose leadership, expertise, and integrity have taken the bank to unprecedented heights over the years. A pivotal aspect of BDO’s longevity however is client trust and loyalty, a direct result of its focus on corporate governance.

BDO’s Corporate Governance (CG) journey started with the belief that the key to long-term sustainability and success largely depends on having a good name and reputation in the market place. Beyond mere compliance, the years have transformed this belief into an integral commitment, paving the way for the establishment of framework and policies as well as committees and initiatives that keep the bank moving to the right direction and in a safe manner.

BDO believes in the value of corporate governance—that it should be a central element of a healthy, financially-sound and well-managed bank. Today, it is a key driver towards the bank’s sustainable corporate growth and long-term value creation, as it is intrinsically linked to its corporate vision and core values.

A Competitive Advantage

There is no “one-size-fits-all” CG model. Thus, to be holistically effective, BDO customizes its practice, taking into consideration the nature, size, and complexity of its business structure and organizational culture.

Its practice is constantly evolved to support the requirements of the changing business landscape, comply with new regulations, and align with international best practices.

From a business perspective, BDO’s CG philosophy is hinged on empowerment with accountability. Its leaders are given the freedom to move the business forward without undue restraint—but are expected to act with due care, responsibility, and accountability. This freedom allows them to fulfill the bank’s vision and deliver its commitment to its stakeholders.

Three interlinked levels constitute BDO’s CG structure. The board of directors focuses on strategic supervision on behalf of the shareholders while its board committees focus on monitoring and oversight. Meanwhile, the executive management focuses on enhancing the quality, efficiency, and effectiveness of the business.

This structure supports the effective management of BDO’s multiple businesses and retains focus on each one at the same time. It is an underlying strength that gives the bank a competitive advantage and contributes to its overall smooth operations, enabling it to provide its clients with a reliable service and while maintaining its top position in the Philippine banking industry.

A Responsible Corporate Citizen

Leading its environmental initiatives, BDO has a team that focuses on green funding to drive market awareness and interest on renewable and alternative energy. It has partnered with the International Finance Corporation in implementing the Sustainable Energy Finance program which has supported renewable energy projects involving solar, wind, hydro, and biomass. These generate 485.6 MW of clean power and avoid 636,545 tons of CO2 per year.

Other meaningful initiatives include:

A partnership with International Finance Corporation (IFC) via USD 150million in green bonds, the first of its kind in the Philippines, to exclusively finance climate-smart projects and help contribute to the development of climate finance market in the country;
A tie-up with the Japan Bank for International Cooperation (JBIC) for the latter’s Green Facility, a USD50-million re-lending credit facility open to renewable energy, energy efficiency, and green building projects which reduce greenhouse gas emissions;
Partnerships with NGOs on programs primarily for ocean conservation, climate solutions, and species protection;
Complying with Leadership in Energy and Environmental Design (LEED) Standards in constructing its high-rise building in Ortigas to reduce greenhouse gas emissions;
Imposing limits and monitoring exposures to certain industries, such as gaming, tobacco, and alcohol. Lending to other sectors that are deemed to have adverse or harmful effects to the environment and the community is restricted; and
Leveraging its wide ATM network to engage its clients to do their share in protecting the environment.

A Partner of the Community

Through BDO Foundation, its Corporate Social Responsibility (CSR) arm, BDO runs programs that aim to give back to society and make a positive contribution to the broader community.

One of its advocacies is disaster response. BDO is prepared to serve marginalized members of society who are affected by natural or man-made disasters. Some of its projects include: relief operations in disaster-stricken provinces; rehabilitation and reconstruction of rural health centers; construction of houses in resettlement areas, multi-purpose halls, and school buildings; and support for livelihood projects for families with disabled members (or persons with disabilities).

BDO harnesses the power of its over 35,000-strong employee force all over the country by engaging them to volunteer and help out in its activities for the communities that the bank is a part of. Activities include, among others, community building, livelihood/skills training, fund raising, and environmental/green initiatives.

A Preferred and Trusted Bank

As a publicly-listed company, its corporate governance practice is recognized as one of the best in the Philippines. In Asia, the bank is one of the Top 50 ASEAN Publicly-Listed Companies in CG for achieving a high score on the ASEAN CG Scorecard.

BDO’s award-winning CG practice continues to bode favorably among foreign investors. BDO has received an over subscription in its capital market offerings, one of the clear indications that the bank is a good credit risk as an issuer.

Beyond the awards and recognition, BDO’s CG excellence allows it to protect its reputation and the public’s confidence and trust, which contribute to strengthening its financial strength and overall stability as a company.

As BDO continues its journey, it remains committed to its corporate governance philosophy of empowerment with accountability. Its stakeholders can expect it to remain flexible, adjusting its practice with the changing times and new regulations to keep current—but most importantly, to stay at par with the highest global standards on sustainability and corporate governance. This is a deliberate and strategic decision to enable the country’s largest bank to endure and reliably serve its clients and their loved ones for years and years.

Note: Article originally published in Corporate Governance Asia’s Road to Corporate Governance: Inside the Best Corporates in Asia 2018.

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A Journey in Corporate Governance Leadership