(This was probably one of my most difficult interviews -- Yuchengco kept joking all throughout our conversation.)
One of the keys to the success of Alfonso Yuchengco, 83, is how he values partnerships, whether it is with a person, a company, or a country In business circles, his name is synonymous with banking and insurance. He saw the Yuchengco Group of Companies-composed of Rizal Commercial Banking Corporation, Pan Malayan Management and Investment Corporation, Great Pacific Life Insurance, House of Investments, and the Malayan Group of Insurance Companies-grow into the giant that it is today.
Though he jokes that he is "somewhat involved in the decision-making process, and sometimes, they follow me," Yuchengco, who is chairman of the group, is still very much updated with the goings-on in their subsidiaries and affiliated companies. Major plans still pass through him and he remains the strict boss who pays attention to detail (he is a certified public accountant and was once a professor of accounting at the Far Eastern University and University of the East), knowing very well how small things can unmake great plans.
It was this fastidiousness and attention to detail that allowed him to grow RCBC from a small development bank when it opened in 1960 into the fifth-largest private domestic bank in the country today with total consolidated assets of almost P164 billion, and transform Malayan Insurance from a humble operation along Gandara Street into the Philippines' largest insurance firm at present.
Reaching Out
Another key to Yuchengco's success lies in how he values partnerships. RCBC, for instance, banked on its partnership with United Financial of Japan, one of the world's largest financial conglomerates, to help establish its presence in the global markets and strengthen its competitiveness on the local front among Japanese and other foreign clients. Great Pacific Life was born from a prospective partnership with the New India Assurance Corporation. The partnership was aborted when, just before launching, the New India chairman found out his company would be nationalized under Indian rules. Thankful for the crucial piece of information passed on to him, Yuchengco still values the chairman's friendship to this day.
Yuchengco's life demonstrates how important strategic alliances and partnerships are to him. It does not matter if the partner is a person, a company, or a country. All he knows is that in reaching out, much can be accomplished. He is still active in various civic, professional, and philanthropic organizations. A few years ago, he was named by then-President Fidel Ramos as a member of the National Centennial Commission tasked to take charge of the nationwide preparations for the 100th anniversary of Philippine independence in 1998.
The Businessman as Ambassador
The biggest proof of Yuchengco's dedication to his countrymen, however, was his willingness to leave the country to help Filipinos abroad. Yuchengco readily agreed to be named the country's ambassador to the People's Republic of China from 1986 to 1988 and to Japan from 1995 to 1998. In 2001, he was also named the Philippine's permanent representative to the United Nations with rank of ambassador.
These ambassadorial stints were very memorable for him. Japan, in particular, proved to be a very challenging post, especially when he found out that there were as many as 200,000 undocumented Filipinos there. Because of their immigration status, these Filipinos had no access to medical care, which is very expensive in Japan. Yuchengco recalls that there were even cases of sick Filipinos dying because they could not get the necessary medical attention.
He decided to sidestep various immigration restrictions by bringing in a Filipino doctor as an attaché of the embassy. That way, illegally staying Filipinos could just go to the embassy for medical care. That, of course, was kept under cover and Yuchengco was confident he was not going to be discovered. "I thought it was a secret, but at the end of my term, the Ministry of Foreign Affairs hosted a reception for me, and the minister was citing my accomplishments in Japan. One of the accomplishments he cited was that I brought to Japan a doctor to treat the Filipino patients," he laughs. He came home with the Grand Cordon of the Order of the Rising Sun presented to him in 1998 by His Majesty, the Emperor of Japan.
His stint in China, which came right after the first EDSA revolution, was equally interesting. "Deng Xiaoping was still alive. He was the paramount leader, and I watched him undertake various reforms." Since the Philippines was also in a transition phase, Yuchengco took advantage of opportunities to strengthen ties between the two countries. "The relationship between the Philippines and China improved tremendously," he said. Yuchengco left China the day before the Tiananmen Square massacre in 4 June 1989. "Had I known it would happen, I wouldn't have left," he rues.
After the stints in China and Japan, it is not surprising that he found his UN stay "very boring." In his short stint at the UN, he won a Security Council seat for the Philippines, the first time ever that the country was elected to the Security Council.
New Opportunities
The ambassador, however, could never shake out the businessman in him. In between his foreign postings, Yuchengco still managed to undertake important projects. He was, for example, among the taipans who formed Asia's Emerging Dragons Corporation in the early 1990s to undertake infrastructure projects for the country. He was elected chairman of AEDC.
In 1999, Yuchengco purchased the Mapúa Institute of Technology, known for having produced some of the country's best engineers. The acquisition is testimony to his commitment to help improve the Philippine educational system, but it also reflects his sentimental side. "My father used to be in the construction business with Engineer Mapúa," he recalls. He decided to acquire the university not only because he saw strong business opportunities but also because of his desire to preserve his father's business roots. Following the acquisition, the university has undergone a major upgrade, strengthening its capabilities to train students for both engineering and information technology. It has also opened a branch in Makati City.
Zest for Life
That Yuchengco, 83, remains strong and energetic today is probably due to his zest for life. He genuinely enjoys people. He prays and is devoted to the Blessed Mother. He swims daily and makes it a point to be at the office at 10:00 a.m. everyday. Most of all, he believes he is lucky.
Yuchengco possesses a streak of mischief and a sense of humor. "Personal integrity is very important to me. Money doesn't mean so much. I have been negotiating with St. Peter to just let me bring my money, because if I leave them with my children, they will just fight and only the lawyers will get rich. But so far, no answer," he deadpans, "so I just decided to give it to others."
By others, he refers to his various philanthropic causes. For instance, his substantial donation to the Our Lady of Peace Mission Foundation, through the AY Foundation he established in 1970, made possible the building of the Doña Maria H.T. Yuchengco Charity Ward along the Cavite Coastal Road. The foundation also has a university scholarship program for high school graduates who are chosen by their classmates not for intellectual superiority or academic standing but for their discipline and love of country. To them, he says, "Have a dream. If you have a dream, have a plan. Think out the plan. Analyze it."
This might as well be his guiding principle in life. In business and out of it, Alfonso Yuchengco has shown how dreams take shape with a dose of luck and a lot of planning.
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Wednesday, March 8, 2006
Sunday, January 8, 2006
People I Admire Series: Cesar Virata
(Cesar Virata was chairman of BusinessWorld the year I resigned. I admire him for trying to remain faithful to the ideals of Raul Locsin. Even if this conversation took place a month after I resigned from my corporate alma mater, I did not find it uncomfortable at all. In fact, this conversation was akin to walking down the pages of Philippine history for me. I do hope I could live up to my ideals of personal integrity the way Virata has.)
One man that many continue to look up to and see as the personification of integrity is Cesar Virata. Cesar Virata, 75, is still straight as an arrow, secure and complete in his knowledge and understanding of himself and of the world Filipinos continually lament the lack of role models that their children can look up to. For even in this age of shortcuts and instant gratification, Filipinos still maintain that idealism in their hearts.
No stranger to conflict, the Philippine prime minister from 1981 to 1986 and finance secretary/minister from 1970 to 1986 under President Ferdinand Marcos has had to defend what is right against the most formidable of influences and opponents, many times standing his ground in the face of bribes and death threats. Virata is still remembered for having fired 5,000 from the ranks of the Bureaus of Internal Revenue and Customs. President Marcos, known for his brilliance as well as his desire to surround himself with intelligent thinkers, somehow always found himself standing by the recommendations of his plucky finance minister.
Pofessional Relationship
Virata concedes that his relationship with Marcos was "very professional." Before he was called upon to join the government in 1967, he did not personally know the president. Virata, then in his late thirties, was a professor at the University of the Philippines and had been connected with the accounting firm SGV & Co. since 1956 when he was named to the Presidential Economic Staff. Apparently, former executive secretary Rafael Salas, who had worked with Virata at one point, had recommended him to Marcos.
Virata's first task as a member of the PES was to get the Exports Incentives Act passed in Congress. Having been instrumental in bringing Dole and United Fruit to the Philippines, he already recognized that businesses would need enormous support to be able to grow and compete in the world markets. He was eventually appointed undersecretary at the Department of Commerce and Industry, where he helped draw up the Investments Priority Plan. Virata was in the group that enabled the Philippines to take part in the Tokyo Round of the General Agreement on Tariffs and Trade after the country failed to gain admission to the Kennedy Round.
"He sized me up correctly," Virata says of Marcos. "He did not give me dirty assignments." In fact, he professes admiration for the former president's ability to listen to and understand issues. Ten days after Virata's appointment as finance secretary in February 1970, for instance, the Marcos administration was faced with the difficult decision whether to float the exchange rate. It was past five in the afternoon when he called the president, aware that the political situation was highly volatile. "Shall we go ahead (and float the rate)?" Virata asked Marcos. The International Monetary Fund needed an answer within the next 12 hours and the president had to make a decision. For Marcos, it would have been convenient to keep the exchange rate fixed, despite its debilitating effect on the economy. But as Virata would recall, Marcos instructed him to "go ahead, if it's the right thing to do."
Straight Shooter
A number of times, Marcos even reversed his decisions after hearing the opinions of his finance minister. In February 1986, for instance, Virata and Central Bank Governor Jose Fernandez got word that the government would make good on the losses sustained by the United Coconut Planters Bank because of the boycott instigated by then-opposition presidential candidate Corazon Aquino. Based on the information Virata and Fernandez received, Marcos had already signed the decree dictating the terms of this agreement.
Virata recalls going to Malacañang ready to tender his resignation if the president did not change his decision. Marcos, however, readily accommodated them to a meeting, and Virata and Fernandez requested that he repeal the decree "as this was not in accord with international practice." Marcos listened, and then instructed an assistant not to release the signed decree.
"That was our relationship," recalls Virata. "He knew I was ready to resign anytime there were disagreements." But somehow, Marcos saw the value of having a man of Virata's caliber in his Cabinet, and Virata never lost faith in working with the Philippine government.
It would be wrong to conclude, however, that Virata was blind to the Marcos government's failings. He was quite vocal in his observations. In the aftermath of the assassination of former senator Benigno Aquino Jr. in 1983, he told a Financial Times reporter he met at a UN meeting in Istanbul that he "would not discount that some elements in government had a hand" in it. His statement, of course, drew an uproar. Government representatives tried to persuade Virata to retract the statement or to say he was misquoted. "But I said no, I will not retract it, in fact, I will repeat it," recounts Virata. When he reached Philippine shores, this was exactly what he did.
Moving On
It has been almost two decades since Virata vacated his government post in 1986, but there has been no let-up in his daily activities. After the first EDSA Revolution, he went into private consultancy. "I had so many cases, who would want to employ me?" he laughs in recollection. But even if he had all sorts of hold orders and court appearances to contend with, the stigma of being Marcos's prime minister did not last very long. In fact, his first client was the World Bank, which sent him on a three-month assignment abroad focusing on highly indebted countries.
Not long after, he was advising companies on their acquisitions, among them, the National Steel Corporation and Petron. In 1987, he became a member of the advisory board of Metrobank. The following year, Ambassador Alfonso Yuchengco asked him to join Rizal Commercial Banking Corporation, where Virata still sits as corporate vice chairman.
Today, Virata brings the same ideals that saw him through those tumultuous years of government service in his dealings in RCBC, with the Bankers Association of the Philippines, and with all other organizations he is involved with. Corporate governance is his advocacy, and one that he desires to bring to as many Philippine companies as possible. His private consultancy continues to do well, and his Quezon City office remains where it used to be. Virata is still straight as an arrow, secure and complete in his knowledge and understanding of himself and of the world.
Virata is not one to talk of personal legacies, but his work will surely define this for him. He admits he is proud of the work he has done for Philippine business, counting the Tax Code, Tariff Code, Insurance Code, and the development of export processing zones among his accomplishments. He is also pleased to have helped increase the country's budget considerably, from P4 billion when he started in the 1970s to P99 billion in 1986.
Of course, he accedes that there are still so many areas to which he would have wanted to make a contribution, especially environmental protection and population control, his biggest frustrations to date. "In the position I achieved accidentally, the horizon is so broad," Virata says. That he managed to focus on what counts the most is something that Filipinos will always thank him for.
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One man that many continue to look up to and see as the personification of integrity is Cesar Virata. Cesar Virata, 75, is still straight as an arrow, secure and complete in his knowledge and understanding of himself and of the world Filipinos continually lament the lack of role models that their children can look up to. For even in this age of shortcuts and instant gratification, Filipinos still maintain that idealism in their hearts.
No stranger to conflict, the Philippine prime minister from 1981 to 1986 and finance secretary/minister from 1970 to 1986 under President Ferdinand Marcos has had to defend what is right against the most formidable of influences and opponents, many times standing his ground in the face of bribes and death threats. Virata is still remembered for having fired 5,000 from the ranks of the Bureaus of Internal Revenue and Customs. President Marcos, known for his brilliance as well as his desire to surround himself with intelligent thinkers, somehow always found himself standing by the recommendations of his plucky finance minister.
Pofessional Relationship
Virata concedes that his relationship with Marcos was "very professional." Before he was called upon to join the government in 1967, he did not personally know the president. Virata, then in his late thirties, was a professor at the University of the Philippines and had been connected with the accounting firm SGV & Co. since 1956 when he was named to the Presidential Economic Staff. Apparently, former executive secretary Rafael Salas, who had worked with Virata at one point, had recommended him to Marcos.
Virata's first task as a member of the PES was to get the Exports Incentives Act passed in Congress. Having been instrumental in bringing Dole and United Fruit to the Philippines, he already recognized that businesses would need enormous support to be able to grow and compete in the world markets. He was eventually appointed undersecretary at the Department of Commerce and Industry, where he helped draw up the Investments Priority Plan. Virata was in the group that enabled the Philippines to take part in the Tokyo Round of the General Agreement on Tariffs and Trade after the country failed to gain admission to the Kennedy Round.
"He sized me up correctly," Virata says of Marcos. "He did not give me dirty assignments." In fact, he professes admiration for the former president's ability to listen to and understand issues. Ten days after Virata's appointment as finance secretary in February 1970, for instance, the Marcos administration was faced with the difficult decision whether to float the exchange rate. It was past five in the afternoon when he called the president, aware that the political situation was highly volatile. "Shall we go ahead (and float the rate)?" Virata asked Marcos. The International Monetary Fund needed an answer within the next 12 hours and the president had to make a decision. For Marcos, it would have been convenient to keep the exchange rate fixed, despite its debilitating effect on the economy. But as Virata would recall, Marcos instructed him to "go ahead, if it's the right thing to do."
Straight Shooter
A number of times, Marcos even reversed his decisions after hearing the opinions of his finance minister. In February 1986, for instance, Virata and Central Bank Governor Jose Fernandez got word that the government would make good on the losses sustained by the United Coconut Planters Bank because of the boycott instigated by then-opposition presidential candidate Corazon Aquino. Based on the information Virata and Fernandez received, Marcos had already signed the decree dictating the terms of this agreement.
Virata recalls going to Malacañang ready to tender his resignation if the president did not change his decision. Marcos, however, readily accommodated them to a meeting, and Virata and Fernandez requested that he repeal the decree "as this was not in accord with international practice." Marcos listened, and then instructed an assistant not to release the signed decree.
"That was our relationship," recalls Virata. "He knew I was ready to resign anytime there were disagreements." But somehow, Marcos saw the value of having a man of Virata's caliber in his Cabinet, and Virata never lost faith in working with the Philippine government.
It would be wrong to conclude, however, that Virata was blind to the Marcos government's failings. He was quite vocal in his observations. In the aftermath of the assassination of former senator Benigno Aquino Jr. in 1983, he told a Financial Times reporter he met at a UN meeting in Istanbul that he "would not discount that some elements in government had a hand" in it. His statement, of course, drew an uproar. Government representatives tried to persuade Virata to retract the statement or to say he was misquoted. "But I said no, I will not retract it, in fact, I will repeat it," recounts Virata. When he reached Philippine shores, this was exactly what he did.
Moving On
It has been almost two decades since Virata vacated his government post in 1986, but there has been no let-up in his daily activities. After the first EDSA Revolution, he went into private consultancy. "I had so many cases, who would want to employ me?" he laughs in recollection. But even if he had all sorts of hold orders and court appearances to contend with, the stigma of being Marcos's prime minister did not last very long. In fact, his first client was the World Bank, which sent him on a three-month assignment abroad focusing on highly indebted countries.
Not long after, he was advising companies on their acquisitions, among them, the National Steel Corporation and Petron. In 1987, he became a member of the advisory board of Metrobank. The following year, Ambassador Alfonso Yuchengco asked him to join Rizal Commercial Banking Corporation, where Virata still sits as corporate vice chairman.
Today, Virata brings the same ideals that saw him through those tumultuous years of government service in his dealings in RCBC, with the Bankers Association of the Philippines, and with all other organizations he is involved with. Corporate governance is his advocacy, and one that he desires to bring to as many Philippine companies as possible. His private consultancy continues to do well, and his Quezon City office remains where it used to be. Virata is still straight as an arrow, secure and complete in his knowledge and understanding of himself and of the world.
Virata is not one to talk of personal legacies, but his work will surely define this for him. He admits he is proud of the work he has done for Philippine business, counting the Tax Code, Tariff Code, Insurance Code, and the development of export processing zones among his accomplishments. He is also pleased to have helped increase the country's budget considerably, from P4 billion when he started in the 1970s to P99 billion in 1986.
Of course, he accedes that there are still so many areas to which he would have wanted to make a contribution, especially environmental protection and population control, his biggest frustrations to date. "In the position I achieved accidentally, the horizon is so broad," Virata says. That he managed to focus on what counts the most is something that Filipinos will always thank him for.
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