Creating Shared Value Map


To be the most relevant, innovative, and enduring Philippine-based business group, enabling shared value and prosperity for the many stakeholders we serve


To be profitable and create value and synergies while forging partnerships and alliances


  • Integrity
  • Long-term Vision
  • Empowering Leadership
  • Commitment to National Development


  1. Outside-in
  2. Bold leadership
  3. Impact at scale
  4. Focus
  5. Public-private partnership


Reinventing businesses, Transforming communities


To improve lives through resilient businesses and risk-calculated investments that have a meaningful and lasting impact on the country’s economic and social landscape


Our transformation path emphasizes strengthening our environmental, social, and governance aspects in alignment with SDGs to create meaningful and lasting impacts that address marginalization, untapped potential, and irresponsible growth.


  • Micro and Macro Economics
  • Megatrends
  • Leading Sustainability Practices


The risk management initiatives for the year centered on supporting our commitment to the TCFD recommendations and understanding how macro trends and material ESG themes shaped the evolving risk landscape.

More about Our Risk Management




Ayala sits on the Board of the Global Compact Network Philippines and supports the UN Global Compact and its 10 Principles.

Ayala is the first Philippine company to become a member of WBCSD and support its goal of transitioning to a sustainable world.

Jaime Augusto Zobel de Ayala participates as a steward with other CEOs in this Vatican-led council, to promote sustainability and inclusivity globally.

Maximizing relevance and impact through focus

More about Our Sustainability Blueprint


Ayala addresses structural and societal gaps by building impactful businesses and transforming them into industry-leading subsidiaries. Our long-term value creation is driven by a robust financial strategy with sustainability at its core. Over decades, this framework has enabled us to create strong franchises by identifying opportunities in nascent or disrupted sectors.

The 2023 Three-Point Strategic Agenda

In 2021, we laid out a three-point strategic agenda to strengthen and recalibrate our portfolio and position ourselves for economic recovery.

  • 1 Support the continued expansion of our core value drivers Ayala Land, BPI, Globe, and ACEN, which we believe are well positioned to take advantage of the fundamental shifts prompted by the pandemic.
  • 2 Scale up our emerging businesses AC Health and AC Logistics to create new sources of growth and value.
  • 3 Sharpen our portfolio with an increased focus on value realization to fund future investments and strengthen our balance sheet, targeting to raise US$1 billion in proceeds by 2023.
Learn More in the Report of the President

Our financial strategy execution is driven by four elements: Our strategic business development agenda continues to refine our existing business strategies and identify new opportunities by leveraging our financial, intellectual, human, and social and relationship capital. Our capital allocation process utilizes quantitative and qualitative criteria and a multi-step management approach to fund new or existing businesses. We employ active portfolio management to constantly rebalance our holdings to crystalize value and achieve optimal returns in the long term. Finally, our active balance sheet management allows us to stay nimble and drives our capacity to grow. These are done in the context of key global, regional, and local trends that will impact markets, sectors, and businesses in which we choose to invest and operate.

We remain committed to ensuring that we give value to our stakeholders through constant corporate governance, and management of our environmental and social impacts. Our approach is aimed at continuous improvement for our people and the communities we serve. Our business leadership for almost two centuries is driven by our rigor and discipline, keeping us focused on our vision to be the most relevant, innovative, and enduring business group in the Philippines.


Our Vision Pillars will lead us to achieve our three-point strategic agenda.

More on Our Vision Pillars





Strategic Business Development123
Strategic Business Development123

At Ayala, we constantly look for new investment areas, identify opportunities, and assess emerging markets and economic trends. This process includes a thorough analysis of the performance of a business and weighing this against competition, the business landscape, and our approved budget plan. This process determines capital allocation decisions.

All investment proposals that progress beyond the business unit or the Corporate Strategy group and the Finance group are presented to the Investment Committee composed of Ayala’s key senior officers and other senior group executives invited to provide insight. The Investment Committee then reviews the business plan and the strategy for execution. A thorough discussion on risks is carried out and responsible persons are identified to execute the business plan. If the proposed investment is approved, it is then endorsed to the Finance Committee of the Board.

Capital Allocation123
Capital Allocation123

In practice, investment decisions are weighed upon whether they can deliver significant value over time. We follow a rigorous process that evaluates opportunities and tests for business and financial viability. Once capital is approved and deployed, management designates a responsible management team for implementation. Business performance is reviewed on a regular basis, and our gating process involves many groups within the company, including Corporate Strategy and Development, Finance, the Investment Committee, the Board’s Finance Committee, and the Board of Directors.

Portfolio Management13
Portfolio Management13

The Investment Committee and the Board’s Finance Committee review the performance of each business unit through a portfolio strategy cycle throughout the year. This starts with a Group CEO session to align on our outlook, followed by a portfolio review to study our existing assets set against the current macroeconomic backdrop, regular deep dives on specific business units, and an assessment of performance against annual targets. This process provides Investment Committee a platform to determine whether to increase or hold capital allocation or realize value from certain investments. Beyond equity capital, Ayala provides critical support to businesses where necessary, including deploying key talents and corporate infrastructure for sustainability, audit, risk management, legal, strategy, and corporate finance functions.

Balance Sheet Management3
Balance Sheet Management3

The continued prudence and active management of our balance sheet helped cushion the impact of the ongoing pandemic especially that it has become long and drawn out. With the coordinated effort of government and private organizations on the vaccination front, we continue to hope for a strong recovery moving forward and have tailored our balance sheet and financial management strategy to ride on this growth momentum. Our strategy involves the diversification of our funding sources in the loan and capital markets and a sharper focus on liability and financial risk management. These initiatives are in anticipation of broad-based recovery and rising interest rates.

We continue to ensure that our balance sheet remains strong with significant debt capacity and a well–spread-out maturity profile that gives us the flexibility to fund growth opportunities. This is augmented by optimal foreign exchange and interest rate exposure management and diversified funding sources to manage our liquidity requirements. Dividends from Ayala’s portfolio of core businesses also augments our capacity to service operating expenses, interest obligations, and dividends obligations. Our diversified portfolio of businesses also play a key role in mitigating portfolio risk.

Ayala’s loan to value ratio, which compares our net debt to the market value of our investments, is a good measure of our relative indebtedness and our capacity to take on or service our obligations. Tracking this ratio daily helps the Investment Committee in deciding on whether to recycle capital by selling assets to prune our debt levels or take on additional debt to buy undervalued assets during period of uncertainties. The value realization initiatives Ayala executed in 2021 helped fund new investments including our buyback of AC and ALI shares. Our pipeline of value realization initiatives will further strengthen our balance sheet and financial positions.

At the end of 2021, our loan to value ratio decreased to 6.7 percent from 9.2 percent in 2020. The improvement can be attributed to the significant increase of the market values of our assets.

We are comfortable with our loan to value ratio, which indicates that for every ₱6.70 of debt we carry, we have ₱100 of assets behind it. The ratio does not include the impact of our fixed-for-life perpetual bonds as these are perpetual securities and do not have to be repaid. Gross debt was at ₱135.2 billion, while our net debt ended at ₱115 billion. We continue to maintain a high cash position of ₱20.2 billion which not only gives us comfort during challenging times, but also enables us to act quickly on growth opportunities and fund our capital expenditure requirements. At the parent level, net debt to equity ratio stood at 0.90 to 1.

At the end of 2021, our blended cost of borrowings improved to 4.3 percent per annum from 4.5 percent per annum in the previous year. The refinancing of some of our higher interest loans and bonds optimized our financing costs in a rising interest rate environment. We actively managed our obligations and ensured that we mitigate liquidity, foreign exchange, and interest rate risks. In line with this is a quarterly assessment of our potential risk exposures where we calculate the volatility impact on interest rates and foreign exchange. We also adopted hedge accounting to support our currency risk management initiatives. We ensure that our debt maturities are well spread out and in compliance with our internal policy of not having maturities exceeding 20 percent of total debt annually. This ensures that an external event that might affect refinancing in any given year does not cause substantial liquidity exposures.

We maintain a minimum ratio of fixed rate loans to floating rate loans to ensure that our cost of capital carries a similar characteristic with our long-term investments. Our fixed to floating rate mix of 87.6/12.4 reflects our strategy of capitalizing on lower interest rates and puts Ayala in a favorable position in a rising rate environment. This is a conscientious move on our part, anticipating a change in monetary policy and the gradual transition from Libor which may affect our floating rate obligations. Philippine Peso obligations are 58.9 percent of our total obligations and our US Dollar denominated obligations are more than offset by US Dollar cash and long-term foreign currency investments. Hedging is done if non-peso debt is used to fund peso investments. For prudence, foreign currency denominated debt is used to finance foreign-currency denominated investments.

Percentage of Total Parent Debt including Debt Guaranteed by Parent

Our sound financial management practices allow us flexibility in our investment decisions. Our strategy with regards to financing is to raise debt opportunistically in the public markets and rely on strong and transparent banking relationships in the loan markets.

Lastly, our strong credit is shown in our capital raising activities and supported by continued wide access to bank loans even during the pandemic. In May 2021, we successfully raised ₱10.0 billion in fixed rate bonds, marking the first tranche of our ₱30.0 Billion Debt Securities Program. Ayala successfully priced the issuance at the tightest side of the range given high investor interest. In September, we tapped the international bond markets with the issuance of US$400.0 million fixed- for-life senior perpetual securities priced at coupon rate of 3.9 percent. The offering was met strongly by the market, being 4.4 times oversubscribed despite being the lowest yielding unrated perpetual fixed-for- life notes ever in Asia. Finally, in November, we signed the agreement for a US$100 million Social Bond and launched the first social bond for AC Health through a private placement that helped broaden our funding sources in the capital markets. Our diversified financing sources allows access to a unique and dependable funding base in times of market stress and offers the flexibility to take advantage of the expected Philippine recovery. We maintain ample cash and maintain high level of credit facilities from both local and foreign banks to ensure we have available sources of funds to finance new investment opportunities.

Share Price Performance

2021 continued to be a challenging year for the Philippines as the COVID-19 pandemic widened its spread. Quarantine measures throughout the year fluctuated with the rise and fall of daily infections, affecting the flow of mobility, business operations, and social activity. Despite the volatility, enterprises and individuals alike grew more accustomed to such circumstances, resulting in a generally more stable and predictable economic environment over the year. This was helped in large part by an improvement in vaccination rates when the government’s inoculation program kicked off in March. By the end of the year, over half of the Philippine population was vaccinated. This resulted in better business confidence and was reflected in GDP growth which hit 5.6 percent for the year, reversing from a 9.6 percent decline in 2020.

Throughout the year, Ayala’s share price and Philippine stock market moved with the ebb and flow of daily COVID infections, reaching twin troughs in May and August when surges were worst, and peaks early and late in the year when cases were at their lowest.

From the start of the year all the way through May, Ayala saw its share price steadily drop as infections post-holidays climbed steadily. By March when the increase in infections grew more evident, Metro Manila was placed under the stricter enhanced community quarantine, two steps higher from the general community quarantine it was under. This further dragged on Ayala’s share price, causing it to dip below the ₱700/share mark at its lowest point. Although the government’s inoculation program begun during this same period, vaccine procurement was inadequate and the focus was instead put on the slow pace of orders coming in, thus impacting sentiment.

Come May, vaccinations in the country finally ramped up while the daily infection count began to subside. This led to a sharp but short-lived recovery in both Ayala and the market that spanned for about two months. By then, share price had reverted to where it was during the start of the year. Over the course of July though, the spread of COVID infections steepened once again, this time multiplying even faster than it did in May as the Delta variant made its way through the country. As a result, Ayala’s price hit its third quarter trough in August at ₱707/share. By the end of the month, the same events that resulted a recovery late in May—improved vaccination rates and, eventually, fewer daily case counts—instigated another rally in the market. This time, the upturn spanned up until November with Ayala reaching as high as ₱908/share. Throughout this period, Ayala’s share price was able to stay above its pre- COVID levels. While the Omicron variant put a halt to this climb with resulting infections even worse than that of the Delta variant’s, businesses and individuals were far more prepared to deal with the Omicron surge. This resulted in significantly improved responses from the government and companies, and a relatively muted impact on consumer confidence.

Despite the volatility faced throughout the year, the result was flat performances for the Philippine Stock Exchange Index and Ayala, both recording just a 0.2 percent and 0.4 percent gain throughout 2021, respectively. After ending 2020 at ₱827/share, Ayala finished at ₱831/share in 2021.


Ayala’s policy is to provide a regular fixed semi-annual cash dividend to common shares. For voting preferred shares, the dividend rate is 5.77 percent per annum. For non-voting Preferred B Series 1 and Series 2 shares, the dividends are given at 5.25 percent and 4.82 percent per annum, respectively. It is the company’s policy to treat all shareholders equally, ensuring payment of dividends in an equitable and timely manner—within 30 days after being declared and finally cleared.

In 2021, we declared total dividends per common share of ₱6.92, at par with the dividends distributed last year. We understand that our shareholders view our dividends as a regular source of both income and capital returns and strive to maintain consistent distributions from year to year. Moving forward, we will continue to revisit potential sustainable adjustments in the regular dividend rate, with the continued capacity to make new or additional investments as the primary consideration.

Our financial strategy helps us to remain sustainable and resilient, ensuring that we maintain relevance even in turbulent business and social climates.


Core Value Drivers

Portfolio Investments

Emerging Businesses

Our management approach and constant reinvention
has cemented our business leadership over the past

188 years


We continued to forge our non-financial strategies in 2021. In the environmental front, we took a bold commitment to turn our 2050 net-zero pledge into a net-zero plan. This is laid out with strong social and governance commitments that will create opportunities for us to innovate and collaborate with value-chain partners in order to remain a key player in the industry, and contribute more to society.

Business Model


Strong financial position including:

  • Reliable operational cash flow
  • Robust capital allocation

process supported by reliable access to debt at competitive rates


  • Deep expertise of the Philippine ecosystem and key industries
  • Comprehensive approach to value creation linking long-term returns with environmental, social, and governance impact
  • Corporate culture focused on innovation and lifelong learning


  • Best-in-class talent across departments and disciplines
  • Diversity of talent, including global perspective and mindset


  • Strong relationships with a vast network of business partners, investors, communities, academic institutions, and other relevant entities
  • Strong, trusted Ayala brand


Ayala defines its strategy in the context of key global, regional, and local trends that will impact markets, sectors, and businesses in which we choose to invest and operate. We monitor the evolving macroeconomic environment and adapt our strategic and investment decisions in order to remain well positioned to leverage and mitigate the impact of these factors.






The 2023 Three-Point Strategic Agenda

  • 1Support the continued expansion of our core value drivers
  • 2Scale up our healthcare and logistics businesses to create new sources of growth and value
  • 3Sharpen our portfolio with an increased focus on value realization

The COVID-19 pandemic disrupted nearly every aspect of businesses and of people’s lives. In the Philippines, recurring lockdowns were imposed throughout 2020-21 to curb the spread of the virus. With the Philippine population now largely vaccinated, and with measures in place to allow the reopening of businesses, schools, and other institutions, we expect economic activity and growth to ramp up. Economic indicators have improved, with GDP growth of 5.6% and loan growth of 5.4%. While we recognize that some uncertainty remains, organizations nimble enough to adapt to changes will thrive.

How Our Strategy Addresses This

Businesses in the Ayala Group are wellpositioned to capture growth from the reopening of the economy. Our strong financial position, owing to our healthy balance sheet, ensures we have the ability to take advantage of market opportunities as they arise by deploying capital investments to cater to continuing demand. Should there be a resurgence in COVID-19 cases, or if other situations result in restricted mobility, we are likewise prepared with flexible scenario-based plans to continue to serve our customers, to maintain the interests of investors, and to ensure the health and safety of our employees and partners.


Alongside the economy reopening, we expect the gradual return of stronger consumer spending. Unemployment has recovered to single digit from a 15-year high at the height of the lockdown in April 2020, and we believe this will continue to shrink as mobility improves and as the economy recovers. Strength in consumer demand over the medium- to long-term is supported by a young population, resilient remittances, continuous urbanization, and a steady base of micro, small, and medium-sized enterprises, which help spur economic activity within their own communities.

How Our Strategy Addresses This

We continue to prioritize the Philippines with our businesses positioned to contribute to and grow alongside the country’s development. Each of our businesses continue to explore ways to address the needs and demands of the broader market – such as BPI’s renewed focus on its Consumer and SME segments, providing a broad array of residential options through Ayala Land, and catering to the broad base of Filipinos’ healthcare needs through AC Health. We keep an eye on changes in customer needs and behaviors, and are beginning to explore innovative business models to complement our presence in traditional services.

IntellectualSocial and Relationship

Increasing access to technology coupled with the mobility restrictions due to the COVID-19 pandemic have accelerated the transition to digital, with rising demand for innovative and contactless product and service solutions. To meet this evolving demand, new ecosystems such as e-commerce, fintech, and ondemand logistics continue to grow and mature. We expect competition to intensify as technology-enabled challengers enter traditional industries, and as traditional players begin to make significant investments to upgrade their own capabilities.

How Our Strategy Addresses This

We keep empowering our business units to embark on their own digital transformation journeys. As we explore new ways to integrate digital tools into our businesses, we place greater emphasis on those that allow us to serve our customers better, and help reduce costs and frictions within the organization. Many recentlyimplemented digital solutions are expected to remain for the long-term. Furthermore, we maintain our support for investments in new ecosystems – such as GCash for financial payments and AC Logistics for logistics – as well as build the necessary core capabilities within the organization, such as data analytics, to fuel growth.


We believe that to create sustainable and long-term value, private enterprises must continue to strive for deeper engagement with society to address our current environmental, social, and governance (ESG) issues. To address these issues, and heed the renewed call to action across many stakeholders, we see a trend towards more inclusive business models, investments in promising new technologies, more industries promoting the sustainable use of resources, and an increased focus on socially responsible investing strategies.

How Our Strategy Addresses This

We are increasingly deliberate about We are increasingly deliberate about our contributions to the United Nations Sustainable Development Goals (SDG), which we first outlined in our Sustainability Blueprint: Bridging the Filipino to 2030. In addition to our SDG commitments, Ayala is committed to achieving Net-Zero Greenhouse Gas Emissions (GHG) by 2050, and alongside this, to measuring and improving our ESG risk and impact. Each business unit has committed to actionable and measurable sustainability initiatives, and we continue to incorporate sustainability in the performance metrics for our leaders.

ACEN is supporting the global economy’s decarbonization goals by pivoting its generation portfolio towards 100% renewables and spinning of all its thermal capacity by 2025.

IntellectualIntellectualSocial and Relationship

Greater collaboration between the private, government, nongovernment, and academic institutions is more crucial than ever to unlock innovative and effective solutions to today’s challenges. The flexibility and speed that a collaborative ecosystem can provide is critical to achieving our shared goals of a more sustainable and inclusive society. Building on the deeper foundation of cooperation, the silver lining of the COVID-19 pandemic, we expect these partnerships to flourish across administrations as the country promotes economic recovery set against a backdrop of new risks to growth.

How Our Strategy Addresses This

Ayala Group, proactively helps address the health, social, and economic needs of the country in line with our shared values of nation building. Across different industries, we actively engage existing and potential partners to jointly address emerging issues. Through collaboration with policymakers, the academe, and partner organizations, our Public Policy team and Regulatory Council participate in policy discussions on key reforms, which contribute to the overall economic growth and development of the country

HumanSocial and Relationship

The ongoing conflict in Eastern Europe added new price pressures to global energy prices that have been soaring amid a rapid rebound in post-pandemic oil demand. Effects of the resulting rise of commodity prices worldwide reach the Philippines through supply chain disruptions and rising inflation.

How Our Strategy Addresses This

While we expect continued volatility in commodity prices, our various business units are working to hedge exposures and limit the financial impact through initiatives such as long-term contracting of raw materials. Together with our business units, we are focused on maintaining a healthy balance sheet to weather looming economic headwinds. We continue to monitor the evolving situation and the resulting impact to input costs, foreign exchange rates, inflation, and overall macroeconomic sentiment and are prepared to recalibrate our plans accordingly.

FinancialSocial and RelationshipHuman

Vision Pillars

Four pillars guide our decisions on business development, capital allocation, portfolio management, and balance sheet management. These pillars represent our commitment to focused execution amid a crucial period of recovery, delivering on capital investment to support broad economic growth while still maintaining a strong capital position, transforming our businesses to deliver an unparalleled customer experience, and continuing leadership in sustainability.

Underpinning our vision pillars is an unwavering commitment to the Filipino— to doing our part to drive economic recovery from the crisis, and to ensure continued support for national development.

Key Medium-Term Initiatives and 2023 Targets


Our businesses were affected in varying degrees by the pandemic, owing to the diversified nature of the group. Regardless of the magnitude of impact, recovery from the crisis requires focus in executing strategic initiatives that enable the business to not only return to pre-pandemic levels, but to thrive in this new environment.

Management decisions and new initiatives of the holding company are anchored on the following three-point strategic agenda to achieve focus and scale:

  • Continued expansion of our core value drivers—Ayala Land, BPI, Globe, and 1 ACEN—including delivery of strong financial performance and continued market leadership
  • Building scale in our emerging health and logistics businesses while 2 addressing critical needs of the country
  • Sharpen our portfolio with an increased focus on value realization to fund future investments and further strengthen our balance sheet, targeting to raise US$1 billion in proceeds by 2023

In addition to the above strategic agenda, we aim for recovery of financial 3 performance to pre-COVID levels by 2023.


We believe capital investment is an important piece in driving recovery. We seek investments that enable growth and generate positive economic externalities, balanced with good returns.

  • Delivery of capital expenditure plans to fuel growth and economic activity, while maintaining a disciplined portfolio strategy that ensures balanced returns
  • Active management of our debt and cashflows, alongside ongoing value realization initiatives, to ensure that our balance sheet remains strong enough to support recovery and fuel concentric ventures


As consumer demands evolve and new digital channels transform the way we interact with customers, excellence in the way we deliver our products and services is a key differentiating factor which can drive growth.

  • Delivering a best-in-class customer experience across both traditional and digital channels for all business with consumer touchpoints
  • Identifying and executing key synergy initiatives across our business units, which drive value for the group, our businesses, and our customers
  • Further the data analytics capabilities of the Ayala Group to drive meaningful insights for strategic decision-making and to harness opportunities


Recovery is most meaningful when it is inclusive, so we carry on addressing gaps in environmental, social, economic, and governance frameworks. We continue to invest in our employees and partnerships as critical pieces of what enable businesses and society as a whole to thrive.

  • Development of a roadmap and appropriate 1 metrics towards the achievement of Net-Zero 2 Greenhouse Gas Emissions by 2050, as aligned with the Science Based Targets initiatives (SBTi)
  • Continued progress towards our 2030 Ayala Sustainability Blueprint, which is aligned with the UN Sustainable Development Goals (SDGs) Framework
  • Set to achieve target of having at least two female directors (or 30% of board composition) with the nomination of Ms. Chua Sock Koong for election in the 2022 annual stockholders’ meeting, three years ahead of timeline
  • Solidify the Ayala brand as employer of choice in the Philippines and across the region, through continued support and meaningful opportunities to our employees, and by developing a reputable and diverse bench of leaders within the different business units
  • Furthering partnerships with the private and public sectors, and supporting the rollout of the country’s national vaccination roadmap to alleviate the impact of COVID-19

Risk Management

TCFD Roadmap


2021 Goals and Achievements

2022 Goals

2023 Vision


Expand Discussion


Enhanced Climate Risk Governance Structure

Disclose the organization’s
governance around climate-
related risks and opportunities.

Board of Directors

The Board of Directors leads the governance and ensures proper implementation of internal control mechanisms and risk management process.

Risk Management and Related Party
Transactions Committee (RMRPT)


The RMRPT Committee oversees the identification, assessment, and management of risks, including climate- related risks and opportunities, while the Sustainability Committee monitors the progress of the company’s strategy and plans to address environmental, social, and governance issues, including climate change.

Chief Risk and Sustainability Officer

The CRO is the highest management- level position mandated to lead the identification, assessment, and management of climate-related risks and opportunities. In his concurrent role as the CSO, he ensures that sustainability programs are implemented to address ESG concerns.

Group Risk Management and Sustainability Unit

The GRMSU provides support to the CRO/ CSO in the identification, assessment, and management of climate-related risks and opportunities, as well as in the implementation of sustainability programs.

Enterprise Risk Management Council

Sustainability Council

Insurance Council

The Councils are composed of risk, sustainability, and insurance officers who share best practices. They continuously work together on process improvements, and deliver on group-wide initiatives.


Become a TCFD signatory


Monitor and report progress on climate-related risks and other ESG risks and opportunities to the RMRPT Committee


Provide continuous education on climate-related risks and other ESG risks and opportunities to the Board and relevant levels of the organization

  • Report the results of the ongoing climate scenario analysis to the management and RMRPT Committee, and explain its potential financial implications to the group
  • Conduct an ESG workshop for the Board of Directors, as a result of their ESG self-assessment activity

ESG-Competent Board


Expand Discussion


Climate Risk Advisory

Disclose the actual and potential impacts
of climate-related risks and opportunities
on the organization’s businesses,
strategy and financial planning.

Objectives of Climate Risk Advisory Project

We have engaged Aon Risk Consultants, Inc. (“Aon”) in quantifying and evaluating present-day and future risk of natural hazards that may affect the assets of Ayala Corporation and its business units. Through its collaboration with The Climate Service (TCS), the study will utilize the TCS Climanomics analytics platform in providing climate change property vulnerability profiling for all covered properties. With multiple climate scenarios covering present day to the year 2100, insights from the platform will help businesses manage climate risks and build resilience.

Our Climate Ambition

Our Climate Ambition

At the recently concluded UN Climate Change Conference, almost 200 countries agreed to limit the rise in global temperatures to 1.5°C. This reiterated the need for mitigation, adaptation, climate financing, and collaboration to slow the effects of industry on climate change, with the intention of eventually reversing them.

The Philippines, through its own nationally determined contribution, laid out ways for the government to encourage investments in businesses, technologies, and infrastructure that reduce emissions or help make the economy more resilient to the effects of climate change. While the country has yet to set a net-zero target, it has committed to reducing emissions by 75 percent below business as usual by 2030.

Ayala’s Road to Net-Zero Greenhouse Gas Emissions by 2050

Last October 21, 2021, Ayala Corporation committed to achieve net-zero greenhouse gas (GHG) emissions by 2050. Ayala aligns its business strategy with the Paris Agreement’s goal of limiting global warming to 1.5°C compared to pre-industrial levels. As such, Ayala commits to set targets aligned with science that cover direct emissions from owned or controlled sources (Scope 1), indirect emissions from generation of purchased electricity (Scope 2), and relevant indirect emissions that occur in its value chain (Scope 3). We anticipate that Scope 3 emissions will make up a majority of Ayala’s GHG footprint. While Scope 3 emissions may be complex to address, Ayala adheres to net-zero best practice and focuses on understanding and addressing the relevant emissions in its value chain.

To develop a net-zero roadmap, Ayala partners with South Pole, a leading project developer and global climate solutions provider that works with private organizations and governments worldwide. Through the engagement with South Pole, Ayala Corporation and its core businesses, Ayala Land, BPI, Globe, and, ACEN, completed their individual climate action gap analysis in December 2021. The exercise highlighted strengths, identified areas for improvement, and surfaced possible quick wins in the near and medium-term for Ayala and its core businesses.

We are in the process of accounting for the full GHG emissions footprint for the four core business units. Once the full footprint is available, each of the core businesses will develop a roadmap with the appropriate emission reduction strategies to address their Scope 1, Scope 2, and material Scope 3 emissions. We shall then identify interim and long-term science-based targets for each of the core business units.

The rest of our portfolio is expected to follow the same process, beginning with a climate action gap analysis within 2022. We are looking forward to completing the full Ayala Group Climate Ambition Roadmap by the end of 2023.

One of the perils of climate change is rising sea levels. (Ayala Land’s Lio Estate in El Nido, Palawan)

Our ambition to achieve net-zero greenhouse gas emissions by 2050 follows the Ayala group’s commitment to adopt the Task Force on Climate-related Financial Disclosures (TCFD Recommendations). In 2019, Ayala Corporation and its core business units became signatories to the TCFD and are currently working to implement the framework’s 11 recommended disclosures. We have engaged Aon Risk Consultants to determine the actual and potential impacts of climate-related risk and opportunities on our businesses, strategy, and financial planning. The physical and transition-risk study will be completed in 2022. From there, we shall take concrete steps towards mitigating these risks, adapting our processes, and innovating the way we do business to ensure sustainability moving forward. The net-zero roadmap will enable Ayala to satisfy key TCFD disclosure requirements around the strategy and metrics and targets pillars.

Accelerating climate action through our commitment to net-zero greenhouse gas emissions by 2050 is a critical part of Ayala’s sustainability journey. As our concrete contribution to the well-being of future Filipinos, it positions Ayala as a leader, catalyst, and partner for net-zero transition in the Philippines.

Deliverables from the Project

High-level physical risks analysis in decadal terms covering two climate scenarios

Climate Scenarios

  • RCP 8.5
    the Earth gets warmer by around 4.3°C and GHG emissions rise steadily to 2100
  • RCP 4.5
    the Earth gets warmer by around 2.4°C and GHG emissions slowly decline to 2100

Climate Perils


Temperature extremes

Tropical cyclones


Coastal flooding

Severe connective storms

Riverine flood

Qualitative transition risks analysis per entity

Note: Representative concentration pathways (RCPs) are scenarios representing different emissions projection under basic, plausible economic and social assumptions, issued by the Intergovernmental Panel of Climate Change (IPCC). Each RCP has a corresponding projected rise in global average temperature by 2100 and emissions trend to 2100.


Undertake climate-related scenario analysis to determine and understand climate-related risks and opportunities that could have a material financial impact on the parent company and its business units

  • Continuous collaboration between the parent company and the business units on monitoring climate-related risks and opportunities
  • Collaborate with the Corporate Strategy and Finance Groups to integrate climate-related risks and opportunities in our business operations, strategy, and financial planning

Effective ESG and Climate Strategy


Expand Discussion


Climate Change as a Risk Driver

Disclose how the organization
identifies, assesses, and
manages climate-related risks..

Climate-related Risks Identification

In our 2021 risk assessment, climate change emerged as a strong driver of other business risks. We identified, assessed, and continue to manage our different climate-related risks.

See Results

ERM Policy Updates

While we work on our transition to COSO ERM, we have updated our ERM policy to reflect the roles of the Board, key officers and risk management team in the identification, assessment and management of climate- related risks and opportunities.


Refine and integrate climate-related risk management into our current risk management framework

  • Focus on climate-related risks in the annual risk assessment exercise
  • Engage and guide the ERM Council in the implementation of ESG and climate-related risk management process
  • Transition to COSO ERM framework for identifying and assessing ESG risks

Robust Climate and ESG Risk Management Process


Expand Discussion


Net-Zero Strategy Development

Disclose the metrics and targets
used to assess and manage relevant
climate-related risks and opportunities.

The Project Approach, covering the short- and medium-term:

Scope 1 and 2

  1. Validate Scope 1 and 2 emissions and set targets
  2. Build strategy around attaining their Scope 1 and 2 targets
  3. Disclose targets and strategy required

Scope 3

  1. Understand Scope 3
  2. Determine material emissions
  3. Collect data
  4. Consolidate and validate data
  5. Set targets around Scope 3
  1. The overarching goal of achieving net-zero for Ayala Corporation will be based on a structured approach to assess its subsidiaries.
  2. Ayala is working with South Pole to establish the required assessment framework to include the other subsidiaries over the next months.

Enables the group to have an accurate view of emissions and a tangible roadmap for reducing them in line with the net-zero by 2050 ambition.


Conduct Scope 3 screening in preparation for setting science-based targets

  • Net-zero roadmaps for Ayala Land, BPI, Globe, and ACEN

The Ayala Group Net-Zero Roadmap

Annual Risk Assessment

Our risk assessment exercise focused on macro trends, including the COVID-19 pandemic, and material ESG themes, and how these have impacted our business strategy and risk exposures. This was also the first risk assessment exercise attended by the CEOs of our different business units.

  1. Epidemic and Pandemic
  2. Political and Regulatory
  3. Information Security and Cyber
  4. Climate Change
  5. Competitiveness, Innovation, and Synergy
  6. Talent
  7. Brand and Reputation
  8. (also 7) Portfolio Management
  9. Markets and Liquidity
  10. Business Resiliency
  11. Governance and Controls
  12. Technology
  13. Partnerships and Alliances

Refreshed AC Risk Universe

Our risk universe remains at 13 risk categories, amidst some additions and consolidation of categories. Two new risks were added to the list: climate change, and epidemic and pandemic. Innovation and Technology risk was decoupled, resulting to another new risk category, Technology Risk. Meanwhile, Competitiveness, Innovation and Synergy were combined in one category, while Funding and Capital Markets risks were consolidated into Markets and Liquidity risk.

2021 Risk Prioritization Results

Risk Category20212020Info
Epidemic and Pandemic1

Failure to prepare for another pandemic may result in significant financial losses and adverse long-term impact on people’s lives.

Political and Regulatory21
Information Security and Cyber33
Climate Change4

Failure to prepare for another pandemic may result in significant financial losses and adverse long-term impact on people’s lives.

Competitiveness, Innovation, and Synergy55a

Failure to prepare for another pandemic may result in significant financial losses and adverse long-term impact on people’s lives.

Brand and Reputation72
Portfolio Management74
Markets and Liquidity96b

Failure to prepare for another pandemic may result in significant financial losses and adverse long-term impact on people’s lives.

Business Resiliency107
Governance and Controls1113

Failure to prepare for another pandemic may result in significant financial losses and adverse long-term impact on people’s lives.

Partnerships and Alliances139

a 2020 Ranking for Competition Risk

b 2020 Ranking for Capital Markets Risk

c 2020 Ranking for Innovation and Technology Risk

Climate Change as a Risk Driver of Business Risks

Climate Change as a Risk Driver of Business Risks



ESG disclosures are becoming more relevant to Ayala as various external stakeholders seek perspective on how ESG issues are being addressed at the corporate level


Ayala is looking at incorporating the reduction of GHG emissions into existing KPIs to support the achievement of its climate ambition

Below is an articulation of how climate change affects conventional business risks. Following the categorization of TCFD, we indicated which business risks are impacted by physical and transition risks of climate change.


Physical risks

Transition risks

Business Resiliency

  • Tighten business continuity and recovery measures
  • Prepare for stronger typhoons, longer drought periods, and worse flooding


  • Business and community disruption due to weak infrastructure not able to withstand the physical impacts of climate change

Innovation and Technology

  • Business models must evolve and be agile enough to adapt to changes brought about by climate change
  • Leverage technology for increased automation and more streamlined processes

Political and Regulatory

  • Governments may enforce policies that promote and provide incentives for lower GHG emissions
  • Litigations may arise due to climate inaction and disregard for environment-friendly practices

Portfolio Management

  • Revenue-generating capacity of businesses may be affected if products and services are susceptible to climate change
  • Businesses may be rendered irrelevant when not able to shift to environment- friendly practices

Markets and Liquidity

  • Difficulties in sourcing funds if companies fail to meet investor expectations on climate action
  • Challenges in shifting to sustainable and green financing

Brand and Reputation

  • Climate inaction or continued contribution to GHG emissions may lead to customer boycotts or brand apathy
  • Brand value may be diminished if unable to deliver targets on climate ambition

Partnerships and Alliances

  • Brand erosion among stakeholders due to misaligned partnerships and alliances
  • Companies must exercise caution in forging partnerships and alliances to ensure non-association with non- climate-friendly organizations

Workplace Experience and Future of Work as a Risk Driver of Business Risks

Workplace Experience and Future of Work as a Risk Driver of Business Risks



Occupational health and safety and employee engagement are still major concerns due to the shifts caused by the COVID-19 pandemic.


Assess how remote working arrangements affect the organizational culture of Ayala


Forced labor and child labor are not primary areas of concern, as due diligence and control measures related to these issues are already in place.

Similar to climate change, Workplace Experience and Future of Work is another material ESG theme that shapes the context of business risks.


  • Flexible work arrangements pose challenges to organizational culture
  • Reskill or upskill employees so they can better adapt to the changing business environment


  • Business disruption and poor operational performance due to inadequate preparation for the future of work
  • Investing in safety protocols and holistic wellness programs to ensure the physical and mental health of employees during unprecedented times

Brand and Reputation

  • Negative corporate reputation due to failure to adopt fair trade business practices and to provide equitable employment opportunities

Political and Regulatory

  • Penalties due to non-compliance or weak adherence to occupational health and safety regulations

Governance and Controls

  • Negative impacts on employer attractiveness due to lack of policies on human rights, non-discrimination, forced labor, and child labor

Partnerships and Alliances

  • Companies must exercise caution in forging partnerships and alliances to ensure aligned policies on child labor, forced labor, and human rights

Top 5 Risks: Status and Mitigation Plans

Top 5 Risks:
Status and Mitigation Plans




Risk definition

Failure to prepare for another pandemic may result in significant financial losses and an inability to execute and achieve business objectives.

Implications for value creation

  • Significant business disruption
  • Reputational issues
  • Employee health issues or loss of lives

Risk drivers

  • Increase in global travel and integration
  • Changes in land use and greater exploitation of natural environment
  • Knowledge gap
  • Absence of monitoring, timely detection, quarantine, and isolation procedures
  • Availability of basic care

Mitigating controls

  • Current investment in AC Health
  • Document learning experiences from the ongoing pandemic
FinancialHumanSocial and


Risk definition

Inability to anticipate changes in the political and regulatory landscape may result in the inability to protect profitability and brand value.

Implications for value creation

  • Misalignment of business models due to changes in regulations
  • Reputational damage due to non-compliance
  • Loss of franchise, license, or goodwill
  • Financial losses caused by penalties and fines

Risk drivers

  • Declaration of a national state of emergency and other forms of social unrest
  • Constitutional crisis
  • Failure of elections
  • Shifts in regulations due to climate change (e.g., incentives for renewable energy users, carbon taxes)

Mitigating controls

  • Maintain relationships with regulators and government agencies
  • Enhance collaborative projects with the government and the public
  • Continuously monitor latest tax and business regulations
FinancialIntellectualHumanSocial and


Risk definition

Failure to ensure strong and adequate information security controls to safeguard confidentiality, integrity, and availability of critical information may result in financial losses and damaged reputation.

Implications for value creation

  • Reputational damage from breach of privacy and weakness of data protection policies
  • System downtime and potential leakage of critical information
  • Criminal prosecution and fines

Risk drivers

  • Cybercriminals capitalizing on newfound digital and remote working behaviors
  • Lack of technical depth
  • Outdated information security controls and practices
  • Weak IT infrastructure
  • Damage to IT infrastructure and applications
  • Disjointed IT systems and technologies
  • Lack of user awareness on evolving threats

Mitigating controls

  • Strengthen IT infrastructure to support increased usage of digital platforms and to combat information and cybersecurity threats
  • Continuously monitor network activities
  • Continuously train and educate employees on cybersecurity
FinancialIntellectualHumanSocial and


Risk definition

Failure to prepare for physical and transition impacts brought about by climate change may result in significant financial losses and inability to execute and achieve business objectives.

Implications for value creation

  • Loss of lives
  • Project suspension or delayed business recovery
  • Outdated production technology
  • Litigations or fines for non-compliance or unfriendly climate practices
  • Reputational damage

Risk drivers

  • Anthropogenic activities caused by uncontrolled consumption
  • Industrialization and fossil fuel use
  • Deforestation and forest degradation
  • Change in market and talent preferences towards climate change contributions
  • Investors’ perceptions in terms of climate-related programs and initiatives
  • Government regulations on carbon taxation

Mitigating controls

  • Pledged commitment to net-zero emissions by 2050
  • Develop nature-based solutions for the protection and sustainable management of ecosystems
  • Continuously promote climate change awareness through enhanced communication and engagement strategies
  • Conduct scenario analysis to assess climate change impact to businesses
FinancialHumanSocial and


Risk definition

Failure to innovate according to the needs of our customers may result in loss of relevance.

Implications for value creation

  • Erosion of market share
  • Loss of competitive advantage
  • Reputational damage
  • Inability to achieve targeted dividends
  • Inability to achieve targeted SDGs

Risk drivers

  • Volatile competitive environment
  • Slow adaptation to trends and emerging technologies
  • Expanding or shifting customer needs and preferences
  • Inability to understand customers intimately
  • Lack of innovation mindset and culture
  • Sector disruption due to a new entrant or emerging player

Mitigating controls

  • Continuously monitor industry-specific trends and innovation techniques
  • Enhance collaborative efforts among business units to gain intelligence on customers, subject to data privacy bilateral agreements
  • Conduct sessions with key customers and best-in-class partners from other industries to understand their own definition of customer experience and satisfaction
FinancialHumanSocial and

Risk Financing Strategy

Risk Financing Strategy


Learning from the disruption caused by the COVID-19 pandemic, Ayala maintained its risk financing strategy that focuses on changing the mindset of risk owners from procurement to long- term and holistic program, embedding continuous improvement in operational risk management, and building a culture of safety across the group. We focused on what we have accomplished, delivered on what worked, and improved our processes where we can.


In 2021, property and casualty markets started to taper off from significant increases in premium rates due to global losses in recent years. While some insurers had recouped, others were still struggling to get to profitability, thus raising prices for their capacity. In addition, Ayala’s assets are located in geography prone to natural catastrophes. These two scenarios situated the initial estimates for our property insurance program within a 30-percent rate increase.

Actions Taken

  • Improved underwriting information through natural catastrophe modeling, risk engineering surveys, business interruption studies, valuations, and supply chain studies, among others. These were completed in late 2020 and in early 2021 and provided to the markets before the roadshow.
  • Started the renewal process earlier than usual through a virtual insurance roadshow, where we added a segment on ESG and underscored our progress on our adoption of the TCFD recommendations.
  • Held stewardship meetings with key carriers.


  • Significantly improved rate, one-percent reduction in rates against an initial estimated 30-percent rate increase, with a 10-percent increase in total insurable values.
  • The program maintained its risk management bursary that will finance risk management activities and studies for the group.

Emerging Risks

Global upward trend on cyber claims and losses fast-tracked the launch of Ayala’s cyber insurance programs. In 2021, we closed cyber insurance programs for two of our core business units, BPI and Globe. We grouped the remaining business units according to their exposures, conducted workshops, and collected underwriting information. We are targeting to place the cyber insurance programs by the second quarter of 2022. This initiative dovetails with the Group’s Cybersecurity Transformation Journey, which was greenlit in December 2021.

Risk Financing Strategy Roadmap

This roadmap details our journey on risk financing. We will continue to explore alternative risk financing strategies, such as captive and parametric solutions.

Integrated Corporate Governance, Risk Management, and Sustainability Summit

Integrated Corporate Governance, Risk Management, and Sustainability Summit


At Ayala, ESG underpins everything we do and strengthens the resilience of our companies and communities. Our annual Integrated Corporate Governance, Risk Management, and Sustainability Summit held on October 21, 2021, put the spotlight on key environmental, social, and governance factors crucial to forging the path towards financial recovery and long-term sustainability.

Insights were drawn through meaningful discussions with thought leaders and ESG experts. Amid our complex new reality, ESG is shaping the way organizations address demands from different stakeholders and meet expectations for heightened social engagement and corporate citizenship.

During his keynote address, aptly titled “ESG as a Pathway to Recovery,” President and CEO Fernando Zobel de Ayala announced: “As Ayala’s concrete contribution to the well-being of future generations of Filipinos, we are announcing our commitment to achieve net-zero greenhouse gas emissions by 2050. We are aligning ourselves with the global movement for climate action as our way to help secure our country’s future from the threats brought by climate change. We believe that we have the capabilities and collective will to make this happen.”

As Ayala’s concrete contribution to the well-being of future generations of Filipinos, we are announcing our commitment to achieve net-zero greenhouse gas emissions by 2050.”Fernando Zobel de Ayala, President and CEO

Ayala’s announcement of its net-zero GHG ambition came ahead of the 26th United Nations Climate Change Conference of the Parties (COP26), where signatories to the Paris Agreement reported on their progress since 2015. In April 2021, the Philippines submitted its first nationally determined contribution to the Paris Agreement, committing to a projected GHG emission reduction and avoidance target of 75 percent by 2030.

We believe accelerating climate action is vital to our sustainability and resilience. Despite the challenges of COVID-19, global companies are moving towards net-zero emission. Capital has been flowing towards sustainable investments, as a growing number of investors and lenders walk away from carbon-intensive sectors. While our net-zero ambition entails risks and costs, we see it as a long-term investment for future generations, making Ayala a catalyst and partner for net-zero transition in the Philippines.

The annual Integrated Governance, Risk Management, and Sustainability Summit presents a collaboration of individuals from global organizations, working for a better future.

Stakeholder Engagement

We embrace a stakeholder-inclusive approach to value creation. We consider the influence our stakeholders have on our business decision-making process. As such, we constantly involve, consult, and collaborate with them as we strive to articulate the value we endeavor to create through our various communication and engagement platforms. By understanding the needs and meeting the expectations of our different stakeholders, we strengthen trust and confidence in our organization.