Manila Electric Company

2014

Most Socially Responsible Company Of The Year

Manila Electric Company

Most Socially Responsible Company Of The Year

2014

About Manila Electric

“Corporate social responsibility in Meralco is not just about “giving back” but enabling opportunities for many Filipinos to be empowered and rise above the challenges of poverty. And ingrained in the hearts and minds of every man and woman in Meralco is the DETERMINATION TO SERVE which makes volunteerism and giving voluntarily a spontaneous response of our organization.”

The Manila Electric Company, also known as Meralco, is the largest electric distribution utility in the Philippines. At the end of 2013, it has a customer base of 5,367,720 customers and its footprint covers over 9,337 square kilometers – home to approximately 25 percent of the Philippine population. About 50 percent of the Philippine Gross Domestic Product is generated within the Meralco franchise. Sixty percent of the Philippine manufacturing output is also produced within the Meralco franchise. Meralco, an investor-owned electric utility was organized 111 years ago – in 1903 – to provide electric light and power an electric street railway system to Manila and its suburbs. The facilities that Meralco built to provide these two services represented for many years the largest single investment of American private capital and know-how in the whole of East Asia.

For a little more than four decades, Meralco provided Manilans with their first modern mass public transportation system with electric streetcars which in the twenties were supplemented by busses. World War II destroyed the railway system beyond rehabilitation and Meralco gave up its transportation business in 1948, concentrating thenceforth on providing electricity. The electric service it provided powered much of the postwar rehabilitation and early industrialisation of the young republic that became independent in 1946.

In 1961, in a move considered daring at that time, a group of Filipino investors bought Meralco from its American owners, making it the first major American enterprise to be so ‘Filipinised.’ During the decade that followed, the new Filipino management built electric generating and distributing facilities at an unprecedented pace to meet the burgeoning needs of its franchise area.

Meanwhile, major stock transactions in 2009, have placed Meralco on the threshold of exciting initiatives in synergistic partnership with the biggest telecommunications company, the Philippine Long Distance Telephone company. This should augur well not only for Meralco, but for the Philippines as well. The synergistic partnerships can lead not only to increased business opportunities and cost reductions, but also to new, expanded and more affordable service to the public.

Today, Meralco is one of the Philippine’s biggest company. At the end of 2013, its sales revenue was PhP298.6 billion, equivalent to US$7.0 billion. Its market capitalization was PhP282.9 billion (US$6.4billion). The company recorded all-time best levels in sales, operational and financial performance in the same year, living up to its vision of being the country’s total energy solutions provider of choice.

THE MERALCO FOUNDATION: MANILA ELECTRIC’S CSR POLICIES AND IMPLEMENTATION

As Meralco deepens its business footprint in its various growth areas – core electricity distribution service, power generation, retail electricity supplier, franchise expansion, development of its subsidiaries and innovative solutions – it believes that Corporate Social Responsibility and Sustainability (CSR) is an ENABLER of progress to both the business and society at large. This is by ensuring that CSR initiatives are aligned and provides significant value to its customers, the communities where it operates and to the country. This is underpinned by the highest ethical standards in managing its programs. As a concrete expression of good governance, it centralized its CSR program design, management and development through the ONE MERALCO FOUNDATION, its corporate foundation and social development arm which implementedthousands of CSR activities since 2003 and have benefited almost 50,000 marginalized families.

The Meralco Foundation proposes long-term programs and budgets and these are approved according to the plans and implementation strategies. Budgeting for CSR is not a function of profits, but based on the proposed projects’ soundness, significance and sustainability. In 2013, total CSR investment of the foundation was at Philippine Peso 114.8 million.

Core to Meralco’s CSR is the COMMUNITY ELECTRIFICATION program from which all other social development initiatives emanate. While there are other programs such as youth development and disaster response, the Community Electrification focuses on how Meralco creates shared value for all its stakeholders in the work of nation building. The electrification program addresses a very fundamental need in the community without which other opportunities for development might not thrive. The program has been providing safe, reliable and affordable electricity to the most vulnerable and underserved communities – informal settlers, portions of resettlement areas, isolated communities, schools, rural health centers and agricultural centers. The program also develops socialized schemes so that marginalized households will have access to electricity. It also usesits own competencies and its people’s commitment so that the act of helping is inclusive, meaningful and sustainable.

In 2013, the Foundation energized 3,079 households belonging to 22 communities within the Meralco franchise area. These households belong to marginalized families which could not afford the initial cost of electrification. Entrepreneurial families have started small businesses to improve their household income now that they have access to affordable and reliable electricity. In San Miguel, Bulacan, the further development of a very promising moringa farming program spearheaded by non-profit organization Green Earth Heritage Foundation was hampered by the lack of a sustainable means of irrigating their farmland. Because the farm was located miles away from the last electrical post, channeling electricity to power an electric water pump would be too costly and inefficient. Determined to help save the livelihood of the 36 farming families, OMF installed two solar-powered water pumps which now deliver water to the farm’s export-quality crops. The farm is the only United States Department of Agriculture (USDA)-certified moringa tea producing farm in the Philippines.

The connection between energy and education cannot be underestimated. In the age of computers and new media, introducing new technologies to students at the earliest stage possible gives them the tools they need to prepare for the future. Technology is powered by energy. Unfortunately, many schools in the country have no access to this valuable resource. Stirred by its determination to help these children leverage their capabilities and skills on technology, the foundation energised 60 public schools located in remote and island communities in the past three years. This benefited thousands of school children who are now able to experience hands-on learning using new ICT tools.

These projects did not just provide a means to access electricity. It helped households, remote communities and schools turn their potential into productivity.

Meralco Employees’ Volunteerism as key driver of CSR. Service defines the company’s culture and every individual employee’s character. This is best expressed in the active volunteerism of its employees which is a major sustainability pillar of Meralco’s CSR programmes. Rooted in its corporate value of Malasakit or genuine concern for others, it has engaged 2,724 Meralco employees logging more than 25,000 volunteer hours to serve 33,396 families in 2013.

For example, its immediate response in times of calamity rely on the strong “makabayan” or patriotic spirit of its employee volunteers who are always ready to serve. Apart from calamities, the volunteers also undertake activities throughout the year which help preserve the environment and promote progress in the communities. These include repainting of classrooms and pedestrian lanes, tree planting, shoreline clean-up, and other similar projects simultaneously done during our annual community days. Volunteer activities prioritized are based on the expressed interest of the employees and based on their competencies. Each year, three corporate-wide Makabayan Days (Community Action Days) are scheduled.

The year 2013 was particularly challenging as it was the year when Typhoon Haiyan, the biggest typhoon in history, made landfall. Its employees donated a day’s worth of their salary for the reconstruction of schools through the “1 Day2Give” program. This resulted to the construction of 18 classrooms in heavily devastated areas. A portion of the fund was also donated for the repair of damaged churches. Plus, 200 volunteers made up four power restoration teams which were sent to the most damaged areas to help in the recovery of 25,000 families in a number of towns and provinces.

How do we measure the results of your CSR work? The foundation looks at the impact on productivity in the lives of its beneficiaries. This is reported in its annual report at www.onemeralcofoundation.org. It will also partner with third party research organisations and the academe for formal measurement activities. CSR activities are part of many departments’ traditions and employee engagement. It is also part of our individual development and performance assessment.

We see two ways for sustaining our initiatives. First, it is resolved to provide focus on energy-related programmes. This is to make sure that it is able to significantly contribute in addressing the energy access for the marginalised and the low-income families. By providing quality, clean and sustainable energy in community infrastructures that drive development it multiplies exponentially the positive effects of electrification. This will be in both forms of infrastructure and people development (through energy education).

The second pillar of sustainability is developing a sound strategy and governance practice within the foundation’s organisation. Given its mission to effect social change, it requires continued engagement with stakeholders as well as demands the foundation be efficient and results oriented by bringing in the capable people and the necessary resources. It uses every resource, from grants to strategic communications, to help its projects and partners achieve impact.

Manila Electric Company

2014

Most Socially Responsible Company Of The Year

Manila Electric Company

Most Socially Responsible Company Of The Year

2014

About Manila Electric

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