The New Aboitiz
It was a bold, ambitious move for the Basque adventurer Paulino Aboitiz when he decided to sail across the world one hundred years ago to start a new life on a small island in Southeast Asia.
But it was a move that had more than paid off. Aboitiz began a simple business trading hemp in Ormoc, Leyte in the late 1800s. After a century marked by two world wars, several political upheavals, economic turbulence, a near bankruptcy, a global pandemic, and many other devastating moments in Philippine history, the Aboitiz Group has now become one of the country’s largest, most successful conglomerates.
Such challenges are par for the course, but only a select few—even within the elite crop of Philippine companies operating for over a century—can manage to weather the storm and expand exponentially the way Aboitiz had done and continues to do, and in the process earn the respect and admiration of the business community.
Today, the Aboitiz Group already has massive investments in power generation and distribution, renewable energy, banking and financial services, food, construction, infrastructure, real estate, and more recently—and perhaps most crucially—data science and artificial intelligence (DSAI).
For this growing corporate giant however, the best is clearly yet to come.
Sabin M. Aboitiz, a fourth generation Aboitiz now at the helm of the group, attributed their business longevity to the family and firm’s strong focus on innovation, and commitment to find better ways to remain resilient and relevant.
“The Aboitiz Group has survived many trials. After World War I, when the price of abaca plummeted, the company found itself on the brink of bankruptcy, with huge losses and debt. The company’s founder, Don Ramon Aboitiz, was pressured by his relatives, friends, and employees to cut his losses and shut down the company, but he refused,” shared the president and CEO of the Aboitiz Group.
“Instead, guided by his palabra de honor, Don Ramon borrowed money from banks and friends, giving only his word as commitment to pay back his debts. If not for his word which he kept, we might not have known the Aboitiz we know today. And this is still the word we keep now, after over a century and having grown into a much bigger and more diversified group of companies. It’s called integrity,” Aboitiz explained.
Currently, Aboitiz Equity Ventures, recognized as one of the best-managed companies in the Philippines and in the region, is the holding company for all of the Group’s interests and investments.
AboitizPower, covers investments in power generation, distribution, and retail electricity services. With its partners, it is the largest owner and operator of renewable energy based on installed capacity in the Philippines.
Its banking arm, Union Bank of the Philippines (UnionBank) continues to dominate and innovate in the Philippine digital banking space. Aboitiz InfraCapital, meanwhile, is the infrastructure arm that builds with a goal of developing a greener and more technologically advanced Philippine economy.
Other businesses include food units Pilmico and Gold Coin; AboitizLand, which develops fully integrated smart communities; and Aboitiz Construction, which has a 46-year track record of value construction and engineering.
Last year, at the height of the pandemic, the Aboitiz Group launched Aboitiz Data Innovation (ADI), which aims to create competitive advantages for the conglomerate’s business units through the adoption and application of data science and artificial intelligence (DSAI) solutions.
The Great Transformation
According to Aboitiz, the company’s critical industrial transitions from abaca to transportation, energy and banking were all turning points that led to what could be their biggest one yet—the “Great Transformation into the first Philippine techglomerate.”
“This transition for the entire group represents a new point of view and a fresh perspective. The past inspired us for the last hundred years, but the future will drive us through the next hundred,” he said.
While the Group’s time-honored values continue to guide them forward as they advance business and communities, a new set of values based on open minds, entrepreneurial spirits, and hyper-innovation will help them do this faster, better, and stronger.
“For us, a techglomerate maximizes the use of technology and innovation wherever it adds value. It incubates new ideas and disruptive new tech startups to add to our business portfolio, and takes a proactive role in helping the public sector transform its own systems, processes, mindsets, and institutions into the most modern, efficient, and progressive they can be,” he further explained.
The Great Transformation also dovetails with the Group’s Environmental, Social, and Governance (ESG) efforts. AEV was one of the winners of the 2022 AIBP ASEAN Tech for ESG Awards for its initiatives to accelerate pathways towards sustainability through DSAI.
Playing a central role in the Aboitiz Group’s Great Transformation is DSAI, which will inject fresh models, processes, and solutions across all businesses. These include promoting financial inclusion through the use of enhanced AI-powered alternative credit scoring and risk models at UnionBank, and improving operational efficiency and environmental sustainability in cement manufacturing plants through the 28-Day Predictive Strength Model.
Other projects like the Data Science Upskilling Program under AboitizPower’s Data Acquisition, Reporting and Analytics Program also pave the way for the development of future-ready talents.
Aboitiz however stressed that the Great Transformation remains to be about the people and their growth, success, and fulfillment. It is something the organization needs to not only thrive in an increasingly complex and unpredictable future, but to survive in it as well.
“Our people have always been our strongest and most valuable asset. And as wide and comprehensive as this transformation is, the bottom line is that it starts and ends with them,” Aboitiz concluded. #