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Sustainability Report 2016

SUSTAINABILITY REPORT 2016

1

Table of Contents

About Metro Pacific Investments Corporation

About the Report

Message from the Chairman, President and CEO, and CFO

Corporate Structure

Key Sectors

Products and Services

Our Sustainability Performance in 2016

Sustainability at MPIC

Creating Value for Stakeholders

Core Drivers of MPIC

Power

Manila Electric Company (MERALCO)

Global Business Power Corporation (GBP)

Water

Maynilad Water Services, Inc. (Maynilad)

Toll Roads

Manila North Tollway Corporation (MNTC)

Tollways Management Corporation (TMC)

CAVITEX Infrastructure Corporation (CIC)

Light Rail

Light Rail Manila Corporation (LRMC)

Hospitals

Asian Hospital, Inc. (AHI)

Makati Medical Center (MMC)

Cardinal Santos Medical Center (CSMC)

GRI Content Index

2

3

4

6

8

9

10

12

22

24

36

38

52

66

68

82

84

84

84

98

100

112

118

124

132

140

2 Metro Pacific InvestmentsSustainability Report 2016

About Metro Pacific Investments Corporation

Metro Pacific Investments Corporation (MPIC) is a Philippine-based, publicly-listed investment management and holding company registered with the Philippine Securities and Exchange Commission (SEC) on March 20, 2006. We are the leading infrastructure holding company in the Philippines with a diverse set of infrastructure assets through our investments in power, water utilities, toll roads, hospital operations, light rail, and logistics.

MPIC is proud of its services which include providing first class medical care, safe and efficient road and rail transportation, generating and distributing electricity and delivering clean and safe drinking water to the public.

MPIC maximizes returns for its shareholders by investing in and managing businesses which deliver high-quality, well-run, and fairly-priced infrastructure in the Philippines and elsewhere in the region. These infrastructure investments are long-term propositions supported by the Company’s commensurate investment in the long-term welfare of its stakeholders.

With headquarters in the Makati Central Business District of Manila, MPIC has established its presence throughout the Philippines with its operating businesses. As a group, it provides livelihood to over 22,000 people.

Our MissionWe are the leading Philippine infrastructure investment firm. We manage, transform and grow our companies while continuously seeking investment opportunities to create long-term value for our shareholders.

Our VisionWe have a stellar portfolio of infrastructure assets, each being the dominant player in its field. We are admired globally for excellence in investing in and transforming infrastructure. We attract, retain and develop world-class talent. Through our companies and foundation, we significantly contribute to the economic development of the Philippines and thereby uplift the quality of life of every Filipino.

Our ValuesTeamwork and Empowerment

• We recognize the diverse strength and abilities within the team.

• We enable and inspire people to achieve superior results.

Integrity and Transparency

• We adhere to the highest ethical and corporate governance standards.

Entrepreneurship

• We innovate, take risks, act quickly and decisively, and are customer focused.

Financial Discipline and Accountability

• We employ rigorous financial analysis to arrive at sound business decisions.

• We are results-driven and meet our commitments.

G4-3, G4-56

3

G4-5, G4-28, G4-30, G4-31

About the Report

This is MPIC’s inaugural Sustainability Report (the “Report”) covering the year ended December 31, 2016 and was prepared in accordance with the “core” option of the Global Reporting Initiative (GRI) G4 guidelines.

The Group’s key operational and non-financial results are summarized in this Report. The scope of this report covers the following operating companies:

• Manila Electric Company• Global Business Power Corporation• Maynilad Water Services, Inc. • Manila North Tollways Corporation• Tollways Management Corporation• CAVITEX Infrastructure Corporation• Light Rail Manila Corporation• Asian Hospital, Inc.• Makati Medical Center• Cardinal Santos Medical Center

This Report was reviewed by the relevant operating companies management and the Corporate Governance Committee of MPIC and was approved by the Board of Directors on November 8, 2017.

We welcome all feedback on the contents of this Report or on any matter relating to MPIC’s sustainability initiatives and practices.

For comments and feedback, please contact us at:

Metro Pacific Investments Corporation 10/F MGO Building Legaspi cor. Dela Rosa Streets Makati City, 0721 Philippines +63 2 888 0888 http://www.mpic.com.ph/contact-us/


Message from the Chairman, President and CEO, and CFO

TO Our FEllOw sTAkEhOlDErs,

We are pleased to share with you our first Sustainability Report covering the year ended 31st December 2016, the year we celebrated 10 years of being a listed company in the Philippines.

Ten years ago, MPIC started its journey with 16 employees and one investment. Now, MPIC has grown to encompass six key business segments— Power, Water, Toll Roads, Hospitals, Light Rail and Logistics. As of 31 December 2016, the MPIC Head Office had 49 employees and a workforce of over 22,000 through the businesses we invest in and manage.

Power, water, roads, transportation, and hospitals are all essential services that society relies on every day. We are keenly aware of the role that we have taken on and the significance of ensuring long-term growth and viability of our businesses for the good of all our stakeholders.

It is in this spirit of sustainable business practice that we continuously strive for improvement and innovation in our businesses as well as engagement with the communities we operate in.

At the heart of MPIC’s investment thesis is the belief that provision of high quality, well run and fairly-priced essential services is compatible with both the overall public good and a fair return to our investors. We believe that our companies will thrive only if we are able to deliver good customer experience at a fair price.

We have taken on difficult or even failing projects and turned them around. These include a number of hospitals on the verge of failure; an insolvent water concession; a utility company with a history of regulatory difficulties unable to invest in service provision; a toll road project which took over six years to gain approval; and a rail project for which there were no other private sector bidders.

MPIC has established itself as an economic partner in nation building. We are also providing extensive employment opportunities and have paid over ₱151 Billion in taxes (net of pass-through taxes) to the National Government in the past ten years.

Power, water, roads, transportation, and hospitals are all essential services that society relies on every day. We are keenly aware of the role that we have taken on and the significance of ensuring long-term growth and viability of our businesses for the good of all our stakeholders.

MANUEL V. PANGILINAN, Chairman

G4-1

5

MANUEL V. PANGILINANChairman

JOSE MA. K. LIMPresident and

Chief Executive Officer

DAVID J. NICOLChief Financial Officer

Our achievements to date have only been made possible through the array of excellent partners we have worked with. We therefore take this opportunity to acknowledge all our stakeholders— each one playing a significant part in helping to bring MPIC to its current position.

This Sustainability Report is a way for us to articulate our position to date and to set out measures we will work to improve in future. We hope this Report will be useful and interesting for you.


G4-4, G4-7

Corporate Structure (as of June 2017)

35.2%

100.0%

51.0%

85.6%

private hospital with tertiary care facilities in the Southern Luzon corridor of metropolitan Manila.

Cardinal Santos Medical Cent re is one of the Philippines’ leading hospitals specializing in the

Invasive Surgery.

Central Luzon Doctors’ Hospital is a tertiary, Level 4 private hospital with teaching and training facilities in Family Medicine and Paediatrics.

Davao Doctors Hospital is a privately-owned, tertiary level and multi-specialty hospital located in the heart of Davao City, the business hub of Mindanao.

CORPORATE STRUCTURE

45.5%Manila Electric Company (MERALCO) is the largest electric distribution company in the Philippines, distributing 55% of Philippine energy consumption, including Metro Manila, serving approximately 28million people through its 6.3 million billed customers.

62.4%Global Business Power Corporation is a leading power producer in the Visayas Region and Mindoro Island, with a combined gross dependable capacity of 854 MW.

75.6%NLEX Corporation, formerly Manila North Tollways Corporation, holds the concession rights to construct, operate and maintain the North Luzon Expressway (NLEX), Subic-Clark-Tarlac Expressway (SCTEX) and the NLEX-SLEX Connector Road.

73.0%Tollways Management Corporation is engaged in the operations and maintenance of toll roads, its facilities, interchanges and all related works. It currently operates and maintains the NLEX and SCTEX.

100.0% CAVITEX Infrastructure Corporation (CIC) holds the concession rights for the operation and maintenance of the Cavitex Expressway.1

100.0% MPCALA Holdings, Inc. holds the concession to

the Cavite-Laguna Expressway.

100.0% Cebu Cordova Link Expressway Corporation holds the concession rights to construct, operate and maintain the Cebu Cordova Link Expressway.45.0%

CII Bridges and Roads is engaged in the construction, development and operation of the urban infrastructure sector in Vietnam.

52.8%Maynilad Water Services, Inc. is the largest water concessionaire in terms of customer base in the Philippines, providing water and sewerage services to 9.3 million customers across cities and municipalities in the West Service Area of Metro Manila through its approximately 1.4 million billed customers.

100.0%MetroPac Water Investments Corporation is an investment holding company which operates, manages, maintains and rehabilitates waterworks, sewerage and sanitation systems and services of MPIC water investments outside Metro Manila.

29.5%Don Muang Tollway Public Company Limited holds the concession rights to operate toll road services from Din Daeng to National Memorial Monument in Thailand.

POWER WATER

TOLL ROADS

Hospitals through MPHHI2

35.2%

100.0%

51.0%

85.6%

private hospital with tertiary care facilities in the Southern Luzon corridor of metropolitan Manila.

Cardinal Santos Medical Cent re is one of the Philippines’ leading hospitals specializing in the

Invasive Surgery.

Central Luzon Doctors’ Hospital is a tertiary, Level 4 private hospital with teaching and training facilities in Family Medicine and Paediatrics.

Davao Doctors Hospital is a privately-owned, tertiary level and multi-specialty hospital located in the heart of Davao City, the business hub of Mindanao.

CORPORATE STRUCTURE

45.5%Manila Electric Company (MERALCO) is the largest electric distribution company in the Philippines, distributing 55% of Philippine energy consumption, including Metro Manila, serving approximately 28million people through its 6.3 million billed customers.

62.4%Global Business Power Corporation is a leading power producer in the Visayas Region and Mindoro Island, with a combined gross dependable capacity of 854 MW.

75.6%NLEX Corporation, formerly Manila North Tollways Corporation, holds the concession rights to construct, operate and maintain the North Luzon Expressway (NLEX), Subic-Clark-Tarlac Expressway (SCTEX) and the NLEX-SLEX Connector Road.

73.0%Tollways Management Corporation is engaged in the operations and maintenance of toll roads, its facilities, interchanges and all related works. It currently operates and maintains the NLEX and SCTEX.

100.0% CAVITEX Infrastructure Corporation (CIC) holds the concession rights for the operation and maintenance of the Cavitex Expressway.1

100.0% MPCALA Holdings, Inc. holds the concession to

the Cavite-Laguna Expressway.

100.0% Cebu Cordova Link Expressway Corporation holds the concession rights to construct, operate and maintain the Cebu Cordova Link Expressway.45.0%

CII Bridges and Roads is engaged in the construction, development and operation of the urban infrastructure sector in Vietnam.

52.8%Maynilad Water Services, Inc. is the largest water concessionaire in terms of customer base in the Philippines, providing water and sewerage services to 9.3 million customers across cities and municipalities in the West Service Area of Metro Manila through its approximately 1.4 million billed customers.

100.0%MetroPac Water Investments Corporation is an investment holding company which operates, manages, maintains and rehabilitates waterworks, sewerage and sanitation systems and services of MPIC water investments outside Metro Manila.

29.5%Don Muang Tollway Public Company Limited holds the concession rights to operate toll road services from Din Daeng to National Memorial Monument in Thailand.

POWER WATER

TOLL ROADS

Hospitals through MPHHI2

Details of the Corporate Structure are in MPIC’s 2016 Audited Consolidated Financial Statements

7

Corporate Structure (as of June 2017)

100.0%

100.0%

51.0% 51.0%

11METRO PACIFIC INVESTMENTS CORPORATIONANNUAL REPORT 2016

Y E A R SY E A R SY E A R SY E A R S

De Los Santos Medical Center is a mid-market teaching and training hospital in Quezon City.

Sacred Heart Hospital of Malolos, Inc. is a 72-bed capacity, Level 2 Hospital located in Malolos City, province of Bulacan.

Our Lady of Lourdes Hospital is a mid-market hospital which services communities in East Manila.

51.0% Mega Clinic is the la

(through Metro Sanitas Corporation)3

rgest and most complete urgent care and walk-in health center in the country.

20.0%Manila Doctors Hospital is a premier private tertiary hospital located along United Nations Avenue in the City of Manila.

West Metro Medical Center is the second largest tertiary hospital in Zamboanga.

33.0%Makati Medical Center is a leading hospital that services the primary central business district in Metro Manila.

93.1%Marikina Valley Medical Center is a prominent tertiary hospital in Marikina.

78.0%Bacolod City’s premier medical institution, Riverside Medical Center is a level 3 tertiary teaching hospital providing quality patient care for the Negrense since 1954.

65.0%

50.0%

Dr. Jesus C. Delgado

Lipa Medix Cancer Center is an oncology treatmentcenter in Lipa City, Batangas.

Memorial Hospital is a tertiary general hospital in Quezon City.

Light Rail Manila Corporation holds a 32-year concession to operate, rehabilitate and maintain the existing 20.7 kilometers encompassing 20 stations of the LRT Line 1.

MetroPac Movers, Inc. is primarily involved in areas of logistics, warehousing, toll manufacturing, transportation and distribution to major fast-moving consumer goods companies in the Philippines.

AF Payments Inc. operates and maintains an electronic payment clearing and settlement system through a contactless automated fare collection system for public utility, including a generic contactless micropayment solution.

Indra Philippines, Inc. is one of the leading providers of information technology solutions to various businesses and industries in the Philippines, with engagements in utilities and

administration.

LIGHT RAIL

LOGISTICS AND OTHERS

55.0%

%0.52%0.67

20.0%

HOSPITALS through MPHHI2

1 - MPIC, through Metro Pacific Tollways Corporation, controls CIC through a Management Letter Agreement dated December 27, 2012. Full description of CIC’s rights is disclosed in Note 1 of MPIC’s 2016 Audited Consolidated Financial Statements.2 - MPIC currently holds 85.6% of Metro Pacific Hospital Holdings, Inc. (MPHHI)’s common shares with the remaining common shares owned by GIC Private Limited (GIC). In addition, GIC holds Exchangeable Bond issued by MPIC which can be exchanged into 25.5% further stake of GIC in MPHHI in future, subject to certain conditions.3 - Metro Sanitas Corporation is 50% owned by MPHHI and 50% by OSI Health XXI S.L.U.


Power: Efficient and Sufficient Energy

MPIC is making a significant contribution to the country’s energy security through its power investments. Currently, MERALCO is continually adding new connections while investing in new generating capacity for Luzon.

MERALCO is the largest electricity distribution Company in the Philippines, covering 36 cities and 75 municipalities including Metro Manila, and serving a population of over 28 Million people. Of this, MERALCO energized a total of 25,753 low income households form 2011 to 2016 through its community electrification program. Its franchise area of over 9,685 km2 covers the core of the country’s industrial, commercial and population centers.

GPB is a leading energy company in the Visayas and Mindoro Island, producing reliable and cost-efficient power supply through eleven power generation companies.

Water: Reliable and Safe Drinking Water

MPIC is committed to ensuring that households and businesses have reliable access to safe drinking water. MPIC’s water business segment includes investments in Maynilad Water Services Inc. (Maynilad) and Metropac Water Investments Corporation (MWIC). Together, Maynilad and MWIC provide water services to over 1.4 Million water connection, or equivalent to more than 9.5 Million people.

Maynilad is the water and wastewater services provider for the 17 cities and municipalities that comprise the West Zone of the Metropolitan Manila area. MWIC is MPIC’s water investment arm for projects outside Metro Manila.

Toll Roads: First Class and Accessible Toll Roads

Through its Toll Road investments under Metro Pacific Tollways Corporation (MPTC), MPIC is connecting people and places and helping business expand. A safe, convenient and fast road network enables convenient travel, reduces pollution by reducing traffic jams, and promotes community development. MPTC is the largest Toll Road operator in the Philippines.

Investments in Toll Roads include NLEX Corporation, Tollways Management Corporation, CAVITEX Infrastructure Corporation, MPCALA Holdings Inc. and Cebu Cordova Link Expressway Corporation. Outside the Philippines, MPTC also has investments in the Ho Chi Minh City Infrastructure Investment Joint Stock Company and Don Muang Tollway Public Company Ltd., in Vietnam and Thailand respectively. In all, MPTC’s 372 km of roads serve more than 550,000 vehicles daily.

Hospitals: The Leading Hospital Chain in the Philippines

MPIC is committed to promoting health and wellness for Filipinos through an expanding network of quality Healthcare facilities. Through Metro Pacific Hospitals Holdings, Inc. (MPHHI), investments in hospital acquisitions are paired with implementation of management efficiency programs and the upgrade and expansion of facilities and equipment. MPHHI served 2,863,577 patients in 2016.

Through MPHHI’s 13 hospitals as of December 31, 2016, MPIC is now the largest hospital operator in the Philippines.

Key SectorsG4-8

9

Products and ServicesMPIC delivers long-term value to its stakeholders through its operating companies. MPIC sits on the board of all its companies, appoints strong management teams, supporting them with appropriate capital expenditure budgets along with incentive plans to achieve business goals and targets.

Light Rail: Reliable and Convenient Rail Service

MPIC is contributing to a secure and fast means of urban commute in the central city of Manila. A consortium led by MPIC established the Light Rail Manila Corporation (LRMC) which assumed responsibility over the operations and maintenance of the LRT1 rail line in 2015. Through LRMC, the LRT1 is undergoing rehabilitation and restoration in order to give the public a better and safer commute experience. As of December 2016, 23 light rail vehicles (LRVs) have been refurbished, bringing the total usable LRVs to 100. On average, the LRT1 served 409,785 riders daily in 2016.

Logistics and Others

Other companies in which MPIC has invested include: MetroPac Movers. Inc, which offers warehousing, trucking, and automotive pre-delivery inspection services; AF Payments Inc., which operates and maintains an electronic payment system; and Indra Philippines, Inc., one of the leading providers of information technology solutions.

Although we plan to expand these businesses in future, their contribution at present is modest and as such they are not covered in this report.


GBP net generation 3,157,725 MWh

MERALCO electricity distributed at 40,142 GWh

Approximately 28 Million people served

MPIC's Toll Road portfolio consists of toll road assets in the Philippines (NLEX, SCTEX, CAVITEX), Thailand (DMT) and Vietnam (CII B&R).

Currently 205 km of expressway in the Philippines (NLEX, SLEX, SCTEX, and CAVITEX), 22 km in Thailand (DMT), and 145 km in Vietnam (CII B&R)

Served 550,985 vehicles per day

LRMC operates, maintains, and is currently refurbishing, the LRT 1 line.

100 operating light rail vehicles

Ridership for 2016 reached 147.7 Million

13 hospitals nationwide

MPIC will continue investing in the businesses and targets to open 30 clinics by 2021

Through MPHHI, 2,863,577 patients were served

Toll Roads

Light RailHospitals

Maynilad is the drinking water & wastewater services provider for the West Zone of Metro Manila

More than 9.5 Million people served(Maynilad and MWIC combined)

Provided 1,366 Million litres of water per day

Water

PowerOur Sustainability Performance in 2016

11

GBP net generation 3,157,725 MWh

MERALCO electricity distributed at 40,142 GWh

Approximately 28 Million people served

MPIC's Toll Road portfolio consists of toll road assets in the Philippines (NLEX, SCTEX, CAVITEX), Thailand (DMT) and Vietnam (CII B&R).

Currently 205 km of expressway in the Philippines (NLEX, SLEX, SCTEX, and CAVITEX), 22 km in Thailand (DMT), and 145 km in Vietnam (CII B&R)

Served 550,985 vehicles per day

LRMC operates, maintains, and is currently refurbishing, the LRT 1 line.

100 operating light rail vehicles

Ridership for 2016 reached 147.7 Million

13 hospitals nationwide

MPIC will continue investing in the businesses and targets to open 30 clinics by 2021

Through MPHHI, 2,863,577 patients were served

Toll Roads

Light RailHospitals

Maynilad is the drinking water & wastewater services provider for the West Zone of Metro Manila

More than 9.5 Million people served(Maynilad and MWIC combined)

Provided 1,366 Million litres of water per day

Water

Power


Sustainability at MPICMPIC’s founders and directors have been investing in the Philippines for over 30 years, the last 10 of which have included the Company’s focus on infrastructure. The Company’s infrastructure investments support inclusive sustainable development of the country. “Sustainability” is not a new concept, albeit that structured reporting to stakeholders and the associated compliance industry surrounding this are new for the business.

Construction and development of infrastructure enhances the communities we serve and their surrounding areas, thus providing us with investment opportunity. However, construction activities and heavy infrastructure operations involve safety challenges for employees, contractors and the public. We acknowledge these challenges and manage them closely. Similarly, it is inevitable that there will be some environmental impact from these activities, which we seek to minimize while being mindful of the economic realities of our communities.

MPIC’s approach to sustainability reflects the values inherent in the governance and conduct of our business. These values define us as a Company and guide our day-to-day business actions which are ultimately focused on delivering all-encompassing sustainable growth.

MPIC’s Environmental, Social and Governance (ESG) structure is under the oversight of the Corporate Governance Committee. MPIC and each of its investee companies have formed Sustainability Working Teams (SWT) who gather and report ESG information while supporting to initiate new sustainability measures.

Our operating companies are at different stages of evolving their own Sustainability frameworks, ranging from beginning to advanced. The MPIC Head Office SWT is responsible for consolidating the ESG information of the Head Office and its significant operating companies.

We believe that each of our businesses is fully attuned to Sustainability. Nevertheless, employing the axiom “what is measured is managed,” we are seeking to use our reporting to enhance our performance. While being mindful that we are at the beginning of our Company's reporting practice, we will continue to act in consultation with regard to the best over-all long-term interests of our stakeholders.

MPIC BOARd OF dIRECTORS

CORPORATE GOvERnAnCECOMMITTEE

SUSTAInABILITY WORKInG TEAMS OF OPERATInG COMPAnIES

MPIC HEAd OFFICESUSTAInABILITY WORKInG TEAM

MPIC SEnIORMAnAGEMEnT

G4-15

13

SUSTAInABILITY FRAMEWORKMPIC’s Sustainability Framework articulates the Company’s strategic path and approach to doing business in a sustainable manner.

At the core of this Framework is MPIC’s foremost goal as an investment management and holding company: creating value for stakeholders. The Company itself is therefore primarily focused on economic sustainability.

From this core goal of value creation emanates six Core Drivers that are considered most material and significant for MPIC, namely: Investment Selection and Portfolio Management; Strategy Management and Leadership Selection; Risk Management; Good Governance and Ethical Business Practices; Employee Welfare; and Social Responsibility. These Core Drivers are the standards by which the Company measures its performance.

The catalyst for value creation begins with the Core Driver of Investment Selection. MPIC recognizes that in choosing investments, it is more likely to achieve its core objective if these investments are sustainable on a broad range of economic, environmental, social and governance aspects.

Pursuing best performance in these Core Driver, the Company has developed a management strategy for its investments that has proved successful— “Manage, Transform, Grow” which enfolds all the six Core Drivers of Sustainability in MPIC.

Investment Selection and

Portfolio Management

RiskManagement

SocialResponsibility

EmployeeWelfare

Good Governance and Ethical Business

Practices

Strategy Management

and Leadership Selection

MPICCreating Value

for Stakeholders

MA

NAG E

TRANSFORM

G R O W

O

pera

tiona

l E

fficiency

Service Excellence

Social ResponsibilityEngaged & Safe

Wor

kpla

ce

Optimized Infrastructure DevelopmentResource EfficiencyClean OperationsBusiness Continuity

Community EngagementEducational SupportGreening InitiativesDisaster Relief & Response

Increasing Access to ServicesCustomer Experience Commensurate ServicesService Continuity

Employee Relations and DiversityHealth & SafetyCompetency & Skills DevelopmentEqual Opportunities

Improving lives through vital infrastructure provision

G4-19, G4-20


MAnAGE

MPIC actively manages its investments through taking control positions, appointing senior leadership, strategy setting and regular Board and Management Committee participation.

TRAnSFORM

Our overarching objectives are to increase customer coverage, drive operational efficiency and create value for money services for all our stakeholders. This entails incentivizing leadership for service and value delivery and providing our business with the necessary capital.

GROW

In employing capital from all over the world, including from hard-working Philippine savers, we need to deliver growth in our business to allow us to provide good returns for our shareholders. This is essential in order to retain private sector capital.

Within the above “Manage, Transform, Grow” strategy, MPIC encourages four areas of good practices among its operating companies: operational efficiency, service excellence, engaged and safe workplace, and social responsibility. Details are discussed in the respective sections of MPIC’s operating companies in this report.

This approach puts in place an effective process of creating value for stakeholders:

STAKEHOLdER RELATIOnSHIPS

Our stakeholder relationships are illustrated below:

As the holding company for large infrastructure providers, we are cognizant of our indirect stakeholders and understand that they have distinct interests. We recognize them as important to us and their interests are given due consideration whenever the organization makes long-term decisions that impact the business and its future.

Operating Companies

Customers/Public

Capital and Leadership

Services

Influences

Regulators

Employees

Capital Investors Creditors

Partners Creditors

EmployeesEnvironment and

Communities

Investors

G4-21, G4-25

15

MPIC’s Direct Stakeholders

MPIC’s direct stakeholders are its employees, investors and partners, and creditors. The decision of each of these groups to engage with and sustain that engagement lies in assessing the quality of the regulatory environment in which their contributions will be received, and the feasibility of executing the plans for our operating companies.

Employees We consider our employees as our most important investment. Our employees want a safe and secure work place that offers career advancement with work-life balance to help them develop and grow as individuals. They want leadership that has integrity, transparency and which promotes a corporate culture of professionalism and fairness.

Investors and Partners MPIC’s direct capital investors and partners from our operating companies are primarily seeking clarity on regulation and growth in earnings and dividends. They require transparency and full disclosure on any matter that may influence their decisions regarding the Company.

Creditors Our creditors are taking less risk than our equity providers but usually carrying a much higher funding burden and are therefore also seeking regulatory clarity and reliable execution. They want effective and accountable management that would ensure stability and continued profitability of the Company.

MPIC’s Operating Companies MPIC’s operating companies are the frontline for service delivery, customer engagement, regulatory coordination and cash generation to provide returns to our investors.

The execution of strategy and service delivery lies in the hands of the capable leadership teams, management groups and employees in our operating companies, who we endeavor to support with guidance, capital, and a supportive and open environment as well as appropriate retention and incentive programs.

Operating Company’s Stakeholders

Customers/Public MPIC as an investment management and holding company is not a direct service provider to the public. Our services are delivered through our operating companies in conjunction with our partners. Feedback systems and interfaces with the Group’s customers are managed directly by the operating companies. MPIC regards the Group’s customers as indirectly our most important stakeholders. Our businesses all exist to serve them as well as possible, and our strategies emphasize this.

Many of our investments are in regulated monopolies for which pricing, minimum service level and returns to the private sector are governed by concession and franchise frameworks. As such, Government also has a key role to play in the overall customer/service/value proposition.

Environment and CommunitiesOur interaction with the environment and communities is primarily through our operating companies. However, MPIC’s investment selection, while mindful of environmental impact, is primarily geared to what the country and its regulators are willing and able to afford. Governments in affluent economies may be willing to mandate more environmentally friendly requirements albeit at higher cost.

CreditorsSimilar to MPIC’s creditors, our operating companies’ creditors are also interested in regulatory clarity and reliable execution.

Government and RegulatorsGovernment and regulators set both the contractual environment in which we operate and the tone and quality of how those contracts are respected and enforced. For the model of private sector infrastructure provision to be sustainable, it is essential that all parties adhere fully to the contract terms. MPIC conscientiously and diligently complies with all the concession and franchise terms and operating agreements. MPIC and its operating companies also closely coordinate with the national and local government as well as industry regulators, in reviewing contractual agreements and issues.


STAKEHOLdER EnGAGEMEnT

stakeholder stakeholder Interests Avenue for Engagement and response to Interests

Investors and Creditors • MPIC’s performance in terms of delivering expected cash flow and profit

• Share price appreciation• Transparency in disclosing plans,

strategies and risks• Compliance with contractual agreements• Regulatory concerns of operating

companies

• MPIC website• Annual reports• Investor updates• Quarterly presentations• Investor/Analyst presentations• Individual meetings, as necessary

Partners • Cash flow and profit performance of each particular MPIC project

• Representation in regular Board Committees/Board Meetings

• Regulatory concerns of operating companies

• Board Committee Meetings• Board Meetings• Individual meetings, as necessary

Operating Companies • Alignment with the expectations of MPIC

• Funding support for new projects/acquisitions

• Regular board meetings• Annual budget meetings• Regular update meetings• Regular engagement of Head

Office units with their respective counterpart units in the Operating Companies

Government and Regulators* • Compliance with regulations and laws• Disclosures/standards of reporting

• Compliance with all applicable laws and regulations

• Participation in industry-wide regulatory briefings and for a

• One-on-one discussions during project bidding processes

Employees • Engaging work conditions• Safe and secure workplace• Career opportunities• Work-life balance• Transparent, honest and professional

leadership

• Employee Engagement• Safe Working Conditions• Training and Development• Health Programs• Newsletters

We recognize that many of our stakeholders wish to understand both the financial and non-financial performance, objectives, and directions of the Company. For this, as a matter of course (not specifically for this report), we engage with and address the interests of our stakeholders through several platforms, keeping each up to date on the Company’s outlook. Our operating companies, likewise, have similar platforms for their stakeholders who also have various interests. To date, these communications are mainly focused on economic and service level matters.

MPIC’s Direct Stakeholders

G4-6, G4-24, G4-26, G4-27

* Philippine Stock Exchange (PSE), Securities and Exchange Commission (SEC), Philippine Competition Commission (PCC), Bureau of Internal Revenue (BIR), Department of Labor and Employment (DOLE), Public-Private Partnership (PPP) Center and other relevant government agencies.

17

Operating Companies’ Stakeholders (Indirect MPIC Stakeholders)

* Department of Energy (DOE), Energy Regulatory Commission (ERC), Metropolitan Waterworks and Sewerage System (MWSS), Toll Regulatory Board (TRB), Department of Transportation (DOTr), Department of Health (DOH), Department of Environment and Natural Resources (DENR), People's Credit and Finance Corporation (PCFC), Department of Finance (DOF), Local Government Units (LGU) and relevant government agencies.

stakeholder stakeholder Interests Avenue for Engagement and response to Interests

Customers / Public • Service excellence• Value for money

• Operating companies’ websites• Customer satisfaction surveys• Awareness campaigns• Press releases • Websites and social media

Environment and Communities

• Environmental Impact Assessment• Safe operations• Operational efficiency• Social responsibility

• CSR Programs• Awareness campaigns• Disclosure of emissions testing

and Carbon Footprinting

InvestorsPartnersCreditors

• Operating companies’ performance in terms of delivering expected profit

• Share price appreciation• Transparency in disclosing plans,

strategies and risks• Compliance with contractual agreements

• Operating companies’ websites• Annual reports• Investor relation updates• Quarterly presentations• Investor/Analyst presentations• Individual meetings as necessary

Government and Regulators*

• Compliance with performance metrics• Tariff adjustments

• Compliance with all applicable laws and regulations

• Participation in industry-wide regulatory briefings

• Regular discussions

Employees • Engaging work conditions• Safe and secure workplace• Career opportunities• Work-life balance• Transparent, honest and professional

leadership• Contributing to the nation

• Employee engagement• Safe working conditions• Training and Development• Health programs• Newsletters


SUSTAInABILITY CHALLEnGES PER SECTOR

MPIC’s current perspectives as an investment management and holding company on various environmental and social challenges faced by its operating companies are outlined below. These challenges are to be managed primarily by each of MPIC’s operating companies. Maynilad is the most advanced among MPIC’s operating companies in terms of sustainability reporting and sustainability practices, having released its 5th Sustainability Report for the year 2016.

segmentPrimary Environmental and Social Challenges

MPIC’s Perspectives as an Investment Management and Holding Company

How MPIC’s Operating Companies Manage these Challenges

Power Investments in coal-fired base load generation.

These investments are selected to reflect economic realities of the country at this time.

MERALCO’s investments in, and utilization of, coal-fired base load generation plants are consistent with MERALCO’s obligation under its legislative franchise to supply electricity in the least cost manner.

The power generation subsidiaries and affiliates of MERALCO and GBP utilize the cleanest possible technology for the sizes of the plants to be developed.

Information on our clean technology projects including supercritical coal-fired power plants can be found on pages 40-42 of the MERALCO section, and 52-54 of the GBP section.

All GBP-owned power plants are ISO 14001:2004 (Environmental Management System) or EMS-certified.

Achieving a balance between non-renewable and renewable sources from our current gas and coal dependency.

A reserve capacity market needs to be developed to support the long-term viability of thermal power plants.

Involving the community in all environmental aspects including employment and welfare opportunities, where possible, whenever a new power plant is developed.

water Limited access to clean water arising from weak infrastructure facilities in the Philippines (including presence of multiple contaminants that find their way into the water source)

The Philippines has a plentiful supply of rainfall. The primary issue is accessing and facilitating water collection and delivery.

Water recycling that may be practiced in other countries is not deemed an economic solution in the Philippines due to high processing costs. Please refer to page 46 of Maynilad's 2016 Sustainability Report.

Most of the assets of the Water Business are underground. Providing for those assets involves digging up streets which is disruptive to the Communities.

A Water Safety Program (WSP) is in place which continuously addresses the presence of ammonia, iron, manganese, and other contaminants to deliver safe drinking water to our customers.

Maynilad continues to evaluate opportunities for water recycling plans.

Informing communities in advance before water pipe laying (e.g. digging up streets) and working with them to restore the environment post construction.

Poor sewerage coverage and sanitation in Metro Manila

MPIC is facilitating improvement via massive capital expenditure program to address sanitation in Metro Manila through Maynilad, with commensurate benefit.

Supporting investment plans that integrate water resource management with waste management, environmental stewardship, and human health issues. This includes construction of sewage treatment plants and septage treatment plants.

G4-2, G4-EC2

19

segmentPrimary Environmental and Social Challenges

MPIC’s Perspectives as an Investment Management and Holding Company

How MPIC’s Operating Companies Manage These Challenges

Toll roads

Construction of Toll Roads is by nature, disruptive to the environment.

Toll Roads are efficient and help alleviate congestion and improve productivity through reduced transit time.

Manage water run-off in the cleanest possible manner.

Minimize waiting time at toll booths to reduce wasteful vehicle emissions through increasing use of electronic payment.

Use of environmentally friendly construction materials, always subject to the over-arching cost considerations to the country.

light rail Construction of new rail lines

Human cost of lengthy daily commute in terms of lost proctivity and passenger health.

Light Rail is a more efficient and environmentally friendly mode of transportation than cars and should be more fully developed in Manila.

Rehabilitation of LRVs, signaling and rail replacement, subject to the over-arching cost considerations to the country.

Use of new rolling stock which make efficient use of electricity.

Better ticketing system and faster services to reduce commuter waiting time.

hospitals Hazardous wastes

Efficient use of electricity

Accessibility

Providing high standards of patient safety and wellness

Recycling and re-use of materials is limited as the primary goal is to reduce threat of infection.

Upgrade equipment and training in the hospitals we invest in.

Linen gowns and drapes used by patients with infectious diseases are disposed immediately after use. However, linen gowns and drapes worn by patients with non-infectious diseases are cleaned meticulously before re-use.

Generally, disposal of Hospital wastes is contracted out to DENR-accredited service companies.

Accreditation with Joint Commission International (JCI) and other international institutions in order to force positive change in existing practices of medical staff.


MATERIALITY ASSESSMEnT

In preparing our first Sustainability Report this year (2016) we have made reference to the GRI-G4 Reporting Guidelines.

IdentifyMaterial topics are identified based on activities that are critical to the operations of MPIC as an investment management and holding company.

PrioritizeIdentified topics are ranked according to what we believe are material to our stakeholders and to the Company, as shown in the foregoing section. We refer to our material aspects as "Core Drivers".

VerifyThe identified material aspects are vetted with and approved by the Board of Directors to ensure alignment with MPIC’s vision and mission.

ReviewMPIC’s performance in terms of its identified material aspects (also known as our "Core Drivers") is reviewed regularly by the Board of Directors.

Core Drivers of MPICMPIC has identified and prioritized the following Core Drivers for the Company and its stakeholders as duly reflected in our SustainabilityFramework:

Investment Selection and Portfolio ManagementMPIC’s rigorous processes for investment selection and portfolio management are the fundamental activities that drive MPIC’s success today. The boldness and vision of our founders and their discipline in providing professional management to convert challenging prospects into profitable enterprises are key to the Company’s sustainable growth and viability in the long-term.

strategy Management and leadership selectionMPIC’s ability to deliver on post-investment operational plans is essential to further business development. As such, MPIC places much importance on original strategy setting and the selection and appointment of strong leadership teams to our operating companies.

G4-18

21

risk ManagementMPIC believes that having a robust risk management strategy and system is essential to business sustainability. Safeguarding investments with an eye for opportunities and growth means leadership perspective must be broad, intelligence deep and reliable, and risk management systems comprehensive yet flexible.

Good Governance and Ethical Business PracticesMPIC invests in long-term infrastructure developments that are sustained through the practice of good governance. Good governance directs the day-to-day conduct of our affairs, provides expertise, and steers the growth of the Company and our subsidiaries. Competent and professional management practices must be as sound and dependable as the infrastructures we develop. The Company conducts business in a fair and ethical manner, and promotes its corporate values of accountability, integrity, fairness, and transparency to all its operating businesses.

Employee WelfareMPIC respects and values its employees and provides an engaging and enabling work environment where the potential of its people is developed and realized. Employee well-being ranks among MPIC’s topmost priorities and the Company has a continuing process of building and improving a culture of meritocracy and reward for performance.

social responsibilityMPIC espouses inclusive growth. Beyond fundamental infrastructure, the Company looks to provide communities it operates in with opportunities for growth and upward mobility.The key focus areas for its social responsibility programs are education, environment, economic empowerment and disaster relief.

Detailed discussions on these Core Drivers are on pages 24-35 of this report.


Creating value for Stakeholders2016 marked MPIC’s tenth year of being a listed company in the Philippines. Looking back at its ten-year performance gives context to the Company’s remarkable growth story amidst a challenging business environment of constant changes in both local and global markets.

MPIC’s consolidated core income of ₱12.1 Billion was 17% higher than that of the ₱10.3 Billion in 2015. This growth is attributed to several factors, including: robust traffic growth on the roads held by MPTC, expansions in the power portfolio through increased investment in Beacon Electric Asset Holdings Inc. and GPB, continuing growth in the hospitals group, first full-year contribution from LRMC, and a profitable entry into the Logistics sector.

Consolidated Economic Performance of MPIC Group

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Revenues (in Billions of Pesos)

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Core Income (in Billions of Pesos)

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

reported Income (in Billions of Pesos)

key Financial Data Amount (in Billions of Pesos)

Consolidated Revenue 44.8

Core Net Income 12.1

Core Expenditure 40.5

Taxes Paid to Government* 27.5

Total Assets 351.6

Diluted Earnings per Share 38.06 centavos

Dividends per Share 10.00 centavos

TEn YEAR COnSOLIdATEd PERFORMAnCE

5.0 16

.1

18.6 22

.1 27.8 30

.9 33.8 37

.2

44.8

0

2.0

3.9

5.1 6.

6 7.2 8.

5 10.3

12.1

0.3

0.03

2.3 2.9

4.4 5.

9

7.9 9.

5 11.5

0.5

-0.1

7.2

G4-9, G4-DMA, G4-EC1

*Net of pass through taxes

23

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Diluted Earnings per share (In Centavos)

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Dividends per Share (In Centavos)

Total Consolidated Assets (in Billions of Pesos)

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

2007 2010 2011 2012 2013 2014 2015 2016

Total Consolidated Equity (in Billions of Pesos)

Market Capitalization(in Billions of Pesos)

TEn YEAR COnSOLIdATEd PERFORMAnCE(Continued)

For more details of the Group’s economic performance, please refer to our 2016 Audited Consolidated Financial Statements in the MPIC 2016 Annual Report. The report is available at our website, www.mpic.com.ph.

129.

4

131.

4

160.

2

173.

5 234.

0 302.

2 351.

6

91.6

12.1

200.

6

60.3

65.3

86.4 94

.4

129.

6 150.

8

188.

0

26.7

3.1

113.

3

50.6 78

.4 90.0 10

9.5

119.

8 145.

0

209.

8

19.0

5.9

112.

4

20092008

38.1

34.5

30.4

27.7

23.9

19.114

.2

18.010

.1

-22.

0

10.0

9.3

6.3

3.7

3.2

2.5

2.5


Core drivers of MPIC

InvESTMEnTS SELECTIOn And PORTFOLIO MAnAGEMEnT

MPIC invests in underperforming or incomplete infrastructure that it can rapidly add value to through expansion and construction, resolving regulatory bottle necks and enhancing operating performance. Through this, MPIC delivers improved service and good value to the public, achieves near-term capital value appreciation, and in the longer term as the infrastructure is optimized, delivers a high inflation protected dividend stream to its investors.

MPIC invests in the best possible infrastructure provision within the limitations of what the country can afford. This includes embracing coal-fired power generation (albeit with the cleanest technology), building toll roads to acceptable construction standards with minimal environmental degradation, and utilizing affordable technology for supplying drinking water and providing wastewater and sewage treatment services.

The due diligence process for all investments incorporates relevant sustainability considerations. In addition to the operational and asset upgrades that underpin our strategy, the most frequent post investment sustainability changes that MPIC drives through are regularization of employment terms and enhanced health, safety and security practices.

STRATEGY MAnAGEMEnT And LEAdERSHIP SELECTIOn

Crucial to MPIC’s strategy management is the selection of qualified leaders who will execute the post-investment operational plans for our investee companies. These leaders should have a strong and extensive track record of success and share the Company’s values. The Senior Management teams of the operating companies oversee the day-to-day operations of the investee companies and in turn report to the MPIC Senior Management Team, for relevant updates.

In 2016, MPIC invested further in the following segments:

sector Investment (in Billions of Pesos)

Water 3.00

Power 24.74

Toll Roads 0.57

Others 2.08

Total 30.39

MPIC’s economic performance over the ten-year period is one of the key measures of the Company’s commitment to Sustainability and its Sustainability Framework for which the core goal is “creating value for stakeholders”.

However, it is also MPIC’s performance of the below drivers that laid the foundation for future progress.

25

MPIC’s performance on this aspect is reflected in the growth of its operating companies in the different industry segments. Please see below:

SHARE In OPERATInG CORE InCOME (IN BILLIONS Of PESOS)

WATER POWER

1.54

2.39

3.10 3.

55

4.38 4.

82

3.56

0.32

0.11

3.79

0.21

1.49 1.69 2.

21

3.03

4.54

7.23

2.33

TOLL ROADS HOSPITAL/RAIL/OTHERS

2008 2009 2010 2011 2012 2013 2014 2015 2016 2007 2008 2009 2010 2011 2012 2013 2016

1.28 1.

43

1.46 1.

57

2.24

2.83

3.52

0.17

1.87

0.17 0.

25

0.51

0.45

0.82

0.58

0.44

0.16

0.110.

01

2014 2015

*Expiry of income tax holiday

2007 2008 2009 2010 2011 2012 2013 2014 2015 2009 2010 2011 2012 2013 20162014 20152016*


MPIC recognizes that risk is present in all business activities and that the successful management of risks is a critical factor in optimising stakeholder value. As such, MPIC has developed an Enterprise Risk Management (ERM) program to identify, evaluate, address, report and monitor key risks of the business.

In accordance with MPIC’s ERM policy, everyone is expected to understand the risks that fall within their respective areas of responsibility and to manage these risks appropriately. Below is a summary of the allocation of risk responsibility within MPIC:

• The Board, through the Risk Management Committee (RMC), performs the oversight function for the Company’s risk management process. It reviews and approves MPIC’s ERM Policy and any modifications thereto, including the Company’s risk appetite.

• The Senior Management team of MPIC, comprising of the President and CEO and the Chief Financial Officer, are the ultimate risk executives responsible for ERM priorities. They review the ERM framework to ascertain the adequate allocation of resources and staff requirements of the ERM unit. They also guide the Chief Risk Officer by providing high level ERM strategies and action plans.

• The Chief Risk Officer designs and oversees the entire risk management framework and related ERM Policy, including advocating the adoption of the salient provisions of the Policy across the Company and by MPIC operating companies.

RISK MAnAGEMEnT

• The MPIC Department Heads have accountability for and ownership of assigned risks including communication of progress on risk management strategies and action plans. Together with the Chief Risk Officer, they are responsible for ensuring that emerging risks to which they are exposed are identified and reported appropriately to the Senior Management team of MPIC.

• All MPIC employees are responsible for maintaining awareness of the intrinsic risks in their responsibilities. They are responsible for communicating to their supervisors any key risks that they become aware of, especially the risks that are beyond their control.

• The Company’s Internal Audit is tasked to conduct periodic audits to ensure risk management and that the Company’s risk management practices are in accordance with the approved Policy.

Key risks associated with the Company’s business are discussed in detail on pages 102-105 of MPIC’s 2016 Annual Report.

MPIC is in the process of formally defining sustainability risks and related management approaches. These will be included in our 2017 report.

G4-2, G4-14, G4-EC2

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Good governance enables a strong performance even in challenging times. What makes governance good is fidelity to the corporate vision-mission and an unwavering commitment to its realization. Safeguarding sustainability demands an experienced management team armed with clear policies and standard processes that guide the day-to-day functions of the organization — determining accountability and ensuring transparency.

MPIC Board of directors

The Board directs our corporate governance and practices on how Management delivers on the long-term interests of stakeholders. MPIC believes that a cohesive and objective

GOOd GOvERnAnCE And ETHICAL BUSInESS PRACTICES

Board is necessary for conformance to the highest standards of corporate governance and ethical business practices.

MPIC’s Board is composed of 15 directors at any given time. Our Board is diverse, comprising of leading industry professionals whose experience and expertise have direct bearing on all high level decisions made.

The calendar of the Board and Committee meetings is set at the beginning of each year, and the agenda for each of these meetings is clearly communicated to the members in a timely manner to allow them time to prepare. Any Board Member may elevate matters for consideration at any time.

Director Current Position Date of first appointment/election

Attendance in 2016 Board Meetings

Manuel V. Pangilinan Chairman of the Board March 2006 6/7

Jose Ma. K. Lim Executive Director / President and CEO

March 2006 7/7

David J. NicolExecutive Director / Chief Financial Officer

May 2010 7/7

Augusto P. Palisoc, Jr. Executive Director March 2006 7/7

Ray C. Espinosa Non-Executive Director November 2009 6/7

Ramoncito S. Fernandez Non-Executive Director June 2009 7/7

Robert C. Nicholson Non-Executive Director November 2009 7/7

Artemio V. Panganiban Independent Director August 2007 7/7

Lydia B. Echauz Independent Director November 2009 7/7

Edward S. Go Independent Director July 2006 7/7

Washington Z. SyCip Independent Director August 2011 7/7

Alfred V. Ty Non-Executive Director November 2015 6/7

Albert F. Del Rosario Non-Executive Director May 2016 4/4

Rodrigo E. Franco Non-Executive Director May 2016 3/4

Francisco C. Sebastian Non-Executive Director June 2016 1/1

Edward A. Tortorici Executive Advisor November 2009 2/4

Antonio A. Picazo Corporate Secretary March 2006 3/3

Victorico P. Vargas * NIL May 2011 2/3

*End of term as Non-Executive Director: May 2016

G4-34


Board Committees

Several committees have been established to help the Board oversee and evaluate the performance of the Company and management. MPIC has 5 regular board committees, namely: Corporate Governance Committee, Audit Committee, Risk Management Committee, Nomination Committee and Compensation Committee.

All Board Committees are chaired by Independent Directors.

Corporate Governance Committee The Corporate Governance Committee ensures the overall governance framework is robust and compares favorably to best in class practices. An integral part of this is the annual review and implementation of the Company’s Revised Manual on Corporate Governance and sponsorship of any improvements for the Board of Director’s approval. Pursuant to the mandate of its Charter, the Corporate Governance Committee designed an orientation program for new directors to brief and update them on important details and processes relating to the Company’s board committees and the dealings of the Company with its investors and business partners.

Audit Committee The Audit Committee has oversight of financial reporting and internal controls of the Company. It is responsible for recommending the external auditor and ensuring that non-audit work does not compromise their independence. The Audit Committee also supervises the Internal Audit function and approves its scope of work.

Risk Management Committee The Risk Management Committee assists the Board in fulfilling its oversight responsibilities for the Company’s enterprise risk management policy and execution of risk management strategies

and practices, including regulatory and ethical compliance monitoring. The Committee considers the risk exposures of the Company and evaluates the steps the management is taking in managing and controlling such exposures.

Nomination Committee The Nomination Committee is responsible for vetting and recommending members for nomination to the Board of Directors, including membership in the various Board Committees. The Nomination Committee has the authority to utilize professional search firms or other external sources when searching for candidates to the Board of Directors pursuant to its Charter. The Nomination Committee regularly meets prior to the timetabled Annual Stockholders’ Meeting to review the qualifications of the individuals nominated as the Corporation’s regular and independent directors. Particularly for the latter, the Committee assesses the independence of the Independent Directors.

Compensation Committee The Compensation Committee directly oversees compensation and bonuses of senior executives and overall compensations framework for all employees. It ensures bonus targets are set appropriately and management is motivated for the long term. As mandated by its Charter, the Compensation Committee also exercises functional oversight on matters relating to the areas of leadership development, including—but not limited to—the development and administration of leadership/succession.

For further information about the Board, the Board Committees and our Manual of Corporate Governance, please refer to www.mpic.com.ph/ corporate-governance.

G4-34

29

Ethical Business Practices

Ethical Business Practices make up part of the commitments of each MPIC employee including directors and officers. This encompasses the expected and permissible behavior in various business dealings which are guided by the Code of Business Conduct and Ethics and our Whistle-blowing policy.

The Code of Business Conduct and Ethics is a public document accessible through our company website and forms part of our employee orientation process.

MPIC holds a strict no tolerance policy on corruption as covered by the Company’s policy on honest and fair business dealings which is articulated in the Code of Business Conduct and Ethics. This Code, as well as other policies, is included in the Employee’s Manual which is distributed as a guidance and adherence

document for all employees. Regular review, update and distribution of the document is made by management as deemed necessary.

MPIC employs a Whistle-blowing Policy as an internal control mechanism which affords employees with a clear and confidential reporting framework without fear of retaliation for situations where there is serious risk of misconduct, malpractice or irregularity by the Company or any of its employees. Through this Policy, employees are encouraged to raise their concerns internally and do so in a responsible and effective manner. This Policy is applicable to all employees of the Corporation and its subsidiaries, within or outside the Philippines.

The Company regularly reviews policies and makes amendments or augments as necessary to strengthen alignment with the company’s business direction.

G4-34

EMPLOYEE WELFARE

MPIC’s rapid growth as a company in the past ten years is a reflection of effective human resources management that has been able to hire employees who are capable of exemplary work and performance and who “fit” in the company culture.

MPIC relies on its people for its continued success. Since 2007, the number of employees in the MPIC Head Office has increased from 16 to 49.

“Since joining in 2009, I have considered MPIC as my second home…Everyone is approachable —from the staff to the big bosses. Management recognizes the individual contributions of the employees in attaining company goals... I believe that the Company puts the development of skills and competencies of its employees as one of paramount importance. We have the Continuing Education Program where we can take post-graduate studies and certifications related to our jobs. The Company also sends us to different trainings and conferences, here and abroad” Mr. Jilmar S. Villalon

MPIC Finance Department


Almost 60% of employees are female which is reflected in the leadership with women occupying about 77% of management positions and around 47% of executive positions. MPIC values diversity and promotes gender equality throughout our organization.

MPIC’s culture encourages open communication across the organization. For MPIC employees, it is essential to have clarity in their professional development and career track. Employee engagement programs continuously evolve in the pursuit of the right mix that will most effectively help bring about employee satisfaction and well-being.

Employees by Gender

Male

Female

2029

rank and File

Supervisors

Managers

Executives

Employees by rank

11

6

17

15

Over 50

30 to 50

Under 30

Employees by Age range

9

29

11

Executives by Gender

7 8

MPIC provides compensation and benefits that are at the upper end of industry standards if all objectives are being met. MPIC’s regular employees are provided industry allowances, paid leaves, life and accident insurance, and a retirement plan. It is important to MPIC that employees know they are the Company’s most valuable investments.

HR conducts employee surveys annually (before our Company team building exercises) in order to address developing issues, concerns and areas of dissatisfaction.

G4-9, G4-10, G4-EC5, G4-LA2, G4-LA12

31

MPIC provides various avenues for employee engagement throughout the year. These programs are developed and continuously improved to encourage personal development, as well as to foster teamwork.

Training Programs MPIC provides training for soft skills development, with functional training determined per department. In 2016, the Company conducted the 4th run of its business communication series and a new program using the Hermann Brain Dominance Instrument or HBDI, a system used to measure and describe thinking preference in people. Also, significant for 2016 was the Mini MBA for Emerging Managers, which was facilitated by a contracted training and development company and was attended by supervisors and junior managers.

Annual Team Development Program Our workforce is one team. This program builds on strengthening employee interactions and relations through leisure and team-building activities. The program also promotes high morale among employees through cross functional assignments as they work with different peer groups.

Clubfest MPIC fosters holistic development through the encouragement of extra-curricular activities amongst our employees. The Company provides employees an open opportunity to form clubs in conduct of shared interests and hobbies (e.g. badminton, basketball, bowling, target shooting, among others).

Thank God It’s friday (TGIf) Begun two years ago, this program was a Friday social event for all employees — to unwind and socialize. The program was relaunched in 2016 as a once a month event that offers non-work related workshops, such as calligraphy, photography, brush lettering, and wine tasting.

Flabs to Abs This is a three (3) month contest program developed to encourage the adoption of a fit and healthy lifestyle by our employees. Weight loss relative to body composition is the criteria for declaring the winner, with bragging rights and a cash incentive as prizes. Flabs to Abs has already been repeated for another quarter in 2016 and earmarked for a repeat in 2017.

halloween Party The family-centric culture of the organization is highlighted in this event. It features a Trick-or-Treat activity open to the children, nieces, nephews, and grandchildren of employees and has historically attracted high attendance of participants.

Christmas Party and Service Awards The annual Christmas Party is a highly anticipated event throughout the Company. This is when the Company acknowledges the achievements for the given year and employees who continue to be with MPIC through its many achievements. This is when the organization also formally welcomes new employees.

Employee Engagement Activities

MPIC Team Building Activity

G4-DMA


MPIC's corporate social responsibility (CSR) projects are far-reaching and make a positive contribution to many beneficiaries. The main areas of focus for the company's CSR projects are Education, Health and Community Development.

While the environmental impact of our Head Office, consisting of 49 employees, is minimal, MPIC remains conscious of the impact of our operations with mitigation activities in place.

Environmental Performance

As the functions and operations of MPIC Head Office are largely office-based, resource consumption is limited and environmental impact is often indirect. Nevertheless, this report aims to monitor the environmental performance of MPIC’s Head Office operations.

For 2016, the MPIC Head Office consumed a total of 55,228 kWh of purchased electricity. Associated greenhouse gas (GHG) emissions from this amount of energy equates to 33 tons of carbon dioxide equivalent.

Water consumed by the office, as well as solid waste generated, is measured as a whole for the building in which MPIC leases space. As such, there is no available separate data specific to the MPIC Head Office.

MPIC Foundation

The Metro Pacific Investments Foundation (MPIF) is an investing Company geared towards three fronts of Social Infrastructure: Excellent Education, Environment and Economic Empowerment. In line with MPIC’s commitment to responsible

SOCIAL RESPOnSIBILITY

Students of Mano Amiga

G4-EN3, G4-EN8, G4-EN16

G4-S01

G4-EN3, G4-EN8,G4-EN16, G4-SO1

33

corporate citizenship and nation-building, MPIC has implemented programs benefitting communities, organizations, families and individuals in the areas in which MPIC portfolio companies operate.

Through MPIF, the Group also extended its support to various advocacies, which include promoting Filipino music and arts through Philpop, and continued public service through TV5’s Alagang Kapatid, tree planting, and beautification projects.

The Foundation also donated sacks of rice to different beneficiaries, as well as school bags and supplies to the “Faith Hope Love Kids Ranch”, and medicine kits to cancer-stricken children through a private initiative “Portraits of Love”. MPIC also partnered with the Philippine Agricultural Journalists to support their nationwide climate

change campaign.

Excellent EducationMano Amiga is an institution that provides international-standard education to its students who are all scholars from underprivileged families.

This is the unique thrust of the school which is run on the pillars of committed teachers, personalized attention, home and family support, and integral formation. It is known for producing alumni who are outstanding academic achievers on par with the graduates from the best schools within their country locations. Over 90% of the students complete their high school education and go on to university or technical school. Globally, more than 22,000 children are served through 38 Mano

Amiga schools, though Mano Amiga Philippines is currently the only one outside of Latin America.

MPIC has been a quiet partner of Mano Amiga Philippines since it began its operations in September 2008. Through the years, MPIC has helped cover operational costs including salaries of a staff of ten, eight of which are highly technical teachers.

MPIC employees also volunteer by helping provide Mano Amiga students with school supplies, books and uniforms. They also help with part-time personal coaching of the students. With the full support of MPIC’s management, this project blossomed into a much more tangible and high-impact involvement.

In 2011, MPIC and Mano Amiga started an annual Endowment Fund that ensured 30 children would get the full benefit of the education on offer. These 30 students receive excellent primary and secondary education through a scholarship that covers per-pupil operational expenses of the school as well as miscellaneous fees and expenses on student enrichment activities. In addition, the grant provided for sponsorship of teachers’ benefits and training opportunities.

The school’s infrastructure needs resonated deeply with MPIC for whom quality education is a primary CSR advocacy. In 2016, looking to further support the school’s growth, MPIC made a ₱10 Million donation for the establishment of a new Mano Amiga campus which is expected to accommodate almost 1,000 students in a full K-12 educational system.

The permanent campus will also serve as the pilot campus showcasing the school’s unique and innovative approach to a quality and holistic education, to demonstrate for local government units and other institutions the potential of scaling up the Mano Amiga model.

highlights• Mano Amiga began in 2008 with MPIC

employee-volunteers• Since 2011, number of scholars doubled• In 2016, MPIC donated ₱10 Million to

establish a new campus


Shore-It-Up (SIU) is a high visibility national clean-up campaign raising awareness on the state of the country’s seas, oceans and other water bodies. As MPIF’s environmental program, SIU aims to promote underwater and coastal clean-up as its core activity while also advancing environmental rescue, restoration and revival activities such as mangrove planting, tree planting, giant clam seeding, giant clam moving, and artificial reef installations.

Begun in 2009, SIU has become the longest-running corporate-backed environmental program in the Philippines and effectively combines the passion of some of the MPIC staff for scuba diving with environmental clean-up. Today, the program has grown beyond coastal clean-ups and has set its sights on the greater task of environmental sustainability with its Mangrove Protection and Information Center (M.P.I.C.) established in Del Carmen, Siargao Island.

Siargao has approximately 8,600 hectares of mangrove cover — the second largest in Mindanao — and 4,000 hectares of contiguous mangrove stand in Del Carmen, the largest in the Philippines. This mangrove forest is also home to 44 of the 54 mangrove species worldwide.

The M.P.I.C. is envisioned to become the center for the protection and propagation of mangrove trees in coastal estuaries across the three major areas of the Philippine archipelago. At the same time, it aims to serve as an information hub while also providing economic opportunities for its surrounding communities.

A second M.P.I.C. facility was launched in Alaminos, Pangasinan in February 2016. This structure oversees an 8.17 hectare mangrove area near the Lingayen Gulf. The center is tasked with developing mangrove nurseries, the multiplication and planting of mangrove trees in coastal estuarine areas, the rehabilitation of degraded mangrove ecosystem, and more. The facility aims to help fisherfolk-families and local officials to sustainably reinvigorate the coastal marine ecosystem of Alaminos, Pangasinan and uplift the economic and socio-cultural life in the area.

MPIF is preparing a third M.P.I.C. facility to rise soon in the Visayas.

highlights

• 8.7 Hectares of Mangroves Protected• 2 Mangrove Centers• 7 Locations Nationwide• 137 Families Assisted• 300 Partner Organizations• Nearly 100 divers• Nearly 700 volunteers• Over 1,000 Junior Environmental Scouts

Environment

35

In partnership with Philippine Business for Social Progress, the largest corporate-led social development foundation in the Philippines committed to poverty reduction, MPIF promoted entrepreneurship and employability by assisting some 15 households from the center of Ana Maria Island Community in Quezon City, with a project aiming to augment the community’s income through the establishment of a manpower service as operated by their own cooperative.

In 2015, PBSP reported the completion of the project, with the beneficiaries successfully putting up and registering their own cooperative. The project involved cooperative organizing, potential market identification, capability building, and provision of tools and equipment to start the business. MPIC- and PBSP-accredited coaches provided participants with training on capability building, community investment, and employment opportunity.

Another MPIF initiative with PBSP was a grant providing support to their Strategic Private Sector Partnerships for Urban Poverty Reduction Program (STEP UP) initiative that aimed to organize a manpower group in Brgy. Calamansian, Caloocan City.

MPIF is also an active partner of the MVP Group of Companies’ Tulong Kapatid and its programs that provide assistance and aid to those most in need in times of disasters. Tulong Kapatid programs include Disaster Preparedness, Disaster Response, Recovery and Rehabilitation, and Medical and Social Services.

highlights

• 25 Households assisted by Manpower for Infrastructure Cooperative

• Beneficiaries are now skilled in Masonry, Carpentry, Plumbing, Electrical Lining, Construction

highlights

Tulong Foundation Programs:• Disaster Preparedness• Disaster Response• Recovery and Rehabilitation• Medical and Social Services

Economic Empowerment Tulong Kapatid Initiatives


MERALCO

Manila Electric Company (MERALCO) is the largest private electric distribution utility Company in the Philippines. The Company commemorated 113 years of service in 2016.

MERALCO provides electricity to approximately 28 Million people in 36 cities and 75 municipalities in a franchise area covering 9,685 km2 that includes Metro Manila, the provinces of Rizal, Cavite, Bulacan and parts of the provinces of Pampanga, Batangas, Laguna and Quezon. The franchise covers the core of the country’s industrial, commercial and residential centers.

Its service is primarily power distribution which consists of operations of MERALCO and its 65%-owned subsidiary, Clark Electric Distribution Corporation (CEDC), that is a registered private distribution utility serving exclusively within its franchise area including the Clark Freeport Zone.

For 2016, MERALCO’s consolidated customer count was at 6,038,407, increasing by 4% from 2015. The number of residential customers increased by 5% with 5,537,268, accounting for 92% of the total while commercial customers grew 3% with 486,377, accounting for 8% of the total. Industrial customers grew 2% with 10,138 or less than 1% share of the total. Streetlight accounts numbered less than 1% share with 4,624 customers.

Aside from distribution, MERALCO also provides engineering, design, construction and consulting services, bill collection services,

Customer Type (in thousands)

residential Commercial

20155,2962016

5,537

20154742016 486

Industrial streetlights201510

2016 10

20154

2016 5

distribution and energy management services, and communications, information systems and technology services through its subsidiaries.

It is also developing power generation plants through wholly-owned subsidiary, MERALCO PowerGen Corporation (MGen). Through MGen, MERALCO has a minority equity interest in a power generating company, Global Business Power Corporation (GBP) and PacificLight Power Pte Ltd. (PacificLight).

MERALCO is listed on the Philippine Stock Exchange (PSE: MER). MERALCO has one of the largest market capitalizations in the Philippines. As of end-2016, MPIC’s effective ownership was at 41.2%.

MERALCO’s 2016 Consolidated Core Net Income (CCNI) reached ₱19.6 billion, 4% better than in 2015. Consolidated Reported Net Income stood at ₱19.2 billion, marginally higher than in 2015. Core earnings per share was ₱17.37, while reported earnings per share was ₱17.01.

Several factors such as election expenditures, soft fuel (oil, gas and coal) prices, and relatively stable power supply provided an ideal setting for growth in energy sales, operating excellence, enhanced profitability, and financial strength of the Company. Customers benefited as well, as the average 2016 generation charge was at its lowest in 12 years since 2004 and the average retail electricity rate to customers was at its lowest in 11 years.

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SUSTAInABILITY HIGHLIGHTS

• Customer count in 2016 increased by 4% from 2015

• Sales per employee ratio (SPER) increased by 10%

• Customers served per employee increased by 6%

Total Customers

5,784,1196,038,407

Total Energy sales

37,124 GWh

40,142 GWh

Customers served per employee ratio

1,0221,084

System Average Interruption frequency Index (frequency)

System Average Interruption Duration Index (minutes)

2.43

2.1858.47min

54.68min

system loss (Regulatory cap at 8.5%)

6.35%6.47%

Capital Expenditures (CAPEX)

₱11.3 Billion₱11.6 Billion

2015 2016

Total Electricity Consumption for MERALCO facilities

58,886,835 kWh

Energy intensity 74 kWh / sqm

*Energy intensity computed as:• Total consumption of Business Centers, MERALCO Operating Center, Substations and Sector Offices/Total floor area sqm of Business Centers MERALCO Operating Center,

Substations and Sector Offices• Not part of the scope are consumptions of Mobile stations’ service equipment; temporary station service; open space storage; telecomms repeater station; rented extension

office or kiosk; staff house and special line equipment.

Total Scope 1 GHG Emissions

31,857 tCO2e and Scope 2 GHG Emissions

548,539 tCO2e

G4-EN3, G4-EN5


With a strong resolve in its collective thrust towards customer centricity, MERALCO developed a clear road map for driving energy and customer growth, and sustainably raising customer satisfaction. This includes a comprehensive customer experience transformation program, aimed at making customer experience with us “simple, fast, and convenient.”

The road map to the future also includes transformations and technological innovations among power utilities — the smart grid, where the power and telecommunications grids converge.

A major milestone in the digital transformation journey is the rollout of the Advanced Distribution Management System (ADMS), a core platform in a smart grid. ADMS provides the capability to automate outage restoration, optimize network performance, deploy more smart meters, accommodate more renewables, and integrate new technologies.

Supporting these plans was an ₱11.6 billion capital expenditures (CAPEX) budget which was intended for load and customer growth, network infrastructure upgrading, storm hardening and resiliency, customer service, safety and security in the franchise area.

Electric capital projects included eight (8) substation projects, one (1) subtransmission line project, and 29 other significant and residual projects, which increased MERALCO’s substation capacity by 531 MVA and primary line length by 67 kilometers, bringing the substation capacity to 17,198 MVA and total circuit line length to 18,013 kilometers.

MERALCO also relocated 803 poles and accessory attachments affected by public and private partnership (PPP) infrastructure projects, including road widening projects of the Department of Public Works and Highways (DPWH).

OPERATIOnAL EFFICIEnCY

The System Average Interruption Frequency Index (SAIFI), System Average Interruption Duration Index (SAIDI), and system loss rates were at all-time best levels. Total SAIFI improved by 10%, or to 2.18 times from 2.43 times in 2015. Total pre-arranged SAIDI was at 54.68 minutes, down by 6% compared with 58.47 minutes in 2015. Performance for both metrics was attributed to sustained significant capital expenditures (CAPEX) in the MERALCO sub-transmission and distribution systems, and operating excellence of Networks, Customer Retail and Shared Services organizations.

These CAPEX and related operating expenses (OPEX) included storm-hardening projects such as replacement of ageing poles, extensive use of covered conductors and fiberglass cross-arms, improvement of lightning protection systems, and installation of remote-controlled line sectionalizing devices. Such efforts benefited customers with higher service availability and reliability, power quality, and less and shorter power interruptions.

MERALCO achieved its record-best system loss level at 6.35%, well below the 8.5% regulatory cap. The 2016 performance improved by 0.12 percentage points over 2015, and is 2.15 percentage points lower than the regulatory cap imposed by the ERC. The year’s system loss rate resulted in cumulative savings of ₱26.9 billion for MERALCO customers, or an average of ₱0.09 per kWh since 2008. CEDC system loss similarly ended the year with its lowest-ever level at 3.59%.

The road map to the future also includes transformations and technological innovations amongst power utilities — the smart grid, where the power and telecommunications grids converge.

Investments in the power generation sphere is strategic to MERALCO’s ability to fulfill its mandate to ensure the provision of adequate,

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reliable, and competitive power supply to the growing number of customers in its franchise area and as well, to the rest of the Luzon Grid.

In 2016, MERALCO sourced 42% of the energy distributed from natural gas plants, while 38% was sourced from coal-fired plants. The balance was multi-fuel, which included purchases from the Wholesale Electricity Spot Market, the fuel source of which was a combination of geothermal, hydro, coal and biomass plants.

In 2012, MERALCO decided to re-enter power generation as part of its strategic investment plan. Recognizing its franchise obligation of delivering adequate and reliable power at least cost, MERALCO, through MERALCO PowerGen Corporation (MGen) began development of coal-fired plants using the latest technology which addresses environmental concerns. The additional capacity is likewise pivotal to helping the economy continue its growth at its current trajectory.

Meanwhile, MERALCO subsidiary MGen is building a portfolio of new, highly fuel-efficient and highly-reliable power generating facilities of up to 3,000 MW to support growing electricity demand of Luzon. In line with the country’s long-term vision under Ambisyon Natin 2040, the Department of Energy (DOE) forecasts electricity demand in Luzon to grow at annual average of 5% or three times the 2016 level of 9,726 MW by 2040. To meet demand projections, Luzon will need an additional 24,385 MW of generation capacity by 2040. The new plants will contribute approximately 12% of the additional generation capacity.

These include the (i) San Buenaventura Power Ltd. Co. (SBPL), a 455 MW power generation plant in Mauban, Quezon, the first supercritical coal-fired power plant in the Philippines with

planned commercial operations (COD) in 2019; (ii) Redondo Peninsula Energy, Inc. (RP Energy), a 2x300 MW circulating fluidized bed (CFB) power plant in Subic, Zambales, with a COD in 2020; and (iii) a 2x300 Atimonan One Energy Inc. (A1E) a 2x600 MW ultra-supercritical coal-fired power plant in Atimonan, Quezon, the first power plant in the country to use such technology, with a COD in 2021.

Investments in modern and more efficient coal-powered plants that will use supercritical and ultra-supercritical technology will require less coal per kWh of electricity resulting in lower emissions and lower fuel costs per kWh.

MERALCO has also been exploring renewable energy technologies including wind, solar, biomass and hydroelectric power through MGen and a wholly-owned subsidiary, MSpectrum, Inc. MSpectrum, Inc. signaled MERALCO's formal entry into the solar energy space and other technologies through partnerships, as part of its commitment to sustainability and responsible corporate citizenship.

hazardous solid waste

0.015 MT busted florescent lamps

12.662 MT used lead acid batteries

701 kg medical wastes

916.74 MT used oil

Hazardous liquid waste

916.74 MT used motor oil and

transformer oil

G4-EN23


MERALCO continues its transformation into a highly customer-centric organization providing reliable services to customers with sustained upgrades in quality, competence, and performance culture. The Company brought down the number of employees to 5,569 at end-2016 from 6,203 in 2010, while achieving significantly more electricity sales and serving significantly more customers, indicative of continuous record productivity.

The Company is also in the process of updating its Customer Management System (CMS), the central repository of all customer transactional records, and replacing it with a robust Customer Information System (CIS). The change to CIS, which had already been approved by the Energy Regulatory Commission (ERC), utilizes new technologies and bring MERALCO’s data capture system forward. Once full migration to CIS is complete, customers can expect initial service improvements such as a more informative billing statement, better handling of customer concerns, and account-based handling of payments and credits.

MERALCO conducts surveys of customer satisfaction and does a bi-annual study that measures the degree of customer’s happiness with how well the Company is able to meet their needs. The Customer Satisfaction Index survey and study is conducted by a third party research agency and covers all MERALCO customer segments: residential, businesses, local government units, and national government offices. Tracking what is important to its customers and how well the Company is meeting their needs gives MERALCO direction on how to make the customer experience better.

The 2016 study showed across the board improvement at all customer sectors, with an overall improved score from 8.18 in 2015 to 8.29 in 2016.

SERvICE ExCELLEnCE

segments 2015 2016residential 8.13 8.19General Services 7.99 8.36Local Government Units 8.05 8.44Businesses 8.13 8.35Corporate 8.29 8.35

National Government Offices 8.05 8.21

Overall 8.18 8.29

Key projects in 2016 included:

Energizing Partnerships. With the Energizing partnerships program, Local Government Units (LGUs) work with MERALCO for smarter strategic planning and direct the resources of the cities and municipalities for concrete, effective, and sustainable projects that benefit citizens. The distribution utility also assists LGUs to ensure that progress is enjoyed across all homes in the city or municipality through its community electrification program.

MERALCO’s technical expertise has also been instrumental in planning, building and maintaining energy infrastructures that power emerging economic hubs. To encourage entrepreneurship, MERALCO closely works with LGUs to reduce the processing time for the Certificate of Final Electrical Inspection (CFEI) so that entrepreneurs can get their business energized in the soonest possible time. The LGUs’ environmental conservation efforts are actively encouraged by MERALCO, which advocates the use of electric vehicles to minimize air pollution and consumer dependence on imported fossil fuels.

In 2016, MERALCO sealed partnerships with 14 LGUs within its franchise area.

Customer Satisfaction Index Results

G4-PR5

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Prepaid Electricity Service. MERALCO Kuryente Load (KLoad) had created what Harvard Business Review refers to as shared value, by generating economic value that also produces value for society by addressing its challenges. Electricity consumption becomes more manageable with electronic load denominations as low as ₱100. Leveraging on the extensive network of cellular service electronic loading channels, customers can reload 24/7. Ideal for a sachet market such as the Philippines, KLoad provides flexibility for daily wage and weekly wage earners, students and young professionals living away from home, start-up families and households who are strapped for cash since they are not constrained to pay their electricity bill in one go.

The first of its kind in the world to integrate the electricity network with mobile infrastructure, daily account monitoring via SMS allows customers to manage and control their consumption. Households who switched from postpaid to prepaid were able to save an average of 18% (as of June 2017). Savings could be used to purchase new appliances they have long wished for, which translates to an improved quality of life.

With no collection risk, MERALCO’s prepaid application requirements were relaxed allowing disenfranchised households to secure their own electricity service. Households with illegal connections now prefer subscribing to KLoad. While illegal connections provide free power, they cause fires and generate scorn from neighbors. KLoad makes them responsible users of electricity, with a renewed sense of dignity.

Some 41,000 customers had signed up by year-end. As of December 31, 2016, the service is available in cities of Manila and Mandaluyong, municipalities of Angono, Cainta, Binangonan, and Taytay in Rizal, and parts of Pasig, San Juan, Parañaque, Novaliches, Caloocan, Cavite, Tagaytay and Bulacan.

Customer satisfaction for MERALCO’s postpaid service may have reached an all-time high in 2016 at 8.19, but satisfaction for prepaid is even significantly higher at 8.28 — proof that the shared value created is reflected in the customers’ appreciation of the service. A drill down of attributes that drive satisfaction shows decline in importance for rates and

—


meter reading and increase in importance for customer communication and payment procedures. Through its daily communication with its customers via SMS, MERALCO is able to gain their trust and change the way they view the Company and the service it delivers.

Orange Tag. Filling the information gap to help customers understand the monetary equivalent of appliance usage, the MERALCO Orange Tag was introduced in 2015. Each orange tag provides information about the estimated cost to operate an appliance or electric gadget, down to the specific brand, model and stock keeping unit. The costs are derived from tests conducted at the MERALCO Power Lab, based on how customers generally use their appliances, as established in a third-party survey.

MERALCO partners with appliance manufacturers and negotiates to ensure that display units found at popular appliance stores feature the MERALCO Orange tag to help customers make informed decisions on which appliance brands or models to purchase, not just based on their appliance budget, but also considering how much they will have to pay for the electricity it will consume. A typical 1HP air-conditioner was tested to cost ₱4.50 per hour of use, although in a separate study most customers believed it to cost over ₱50 per hour. For customers with existing appliances, a list of tested units is readily available in the MERALCO website.

With more accurate information on appliances’ operating costs, customers can better calibrate their use according to their budget and become more responsible and empowered to make smart decisions when it comes to purchasing energy-efficient appliances and managing their household electric consumption.

Ultimately, the MERALCO Orange Tag is the end result of simplifying technical power-related data into accessible and understandable information for the benefit of customers. With just one look, the Orange Tag’s customer-centric values speak the language of the typical household.

Power Up forum Series. The Power Up Forum is a program that provides an arena for customers to leverage on MERALCO’s experience and best practices which in turn help address its various operational energy related challenges. This exclusive workshop also enables MERALCO to engage its customers and understand the unique nature of their businesses and develop energy solutions customized based on customer or industry needs. It is also a platform wherein customers are guided on the latest industry and regulatory developments that have a direct impact on their company’s bottomline. It has become an invaluable program for ensuring power reliability, dependability and safety for all customers sourcing their power needs through MERALCO’s distribution network.

Strategic Planning Sessions. For corporate customers, power quality and reliability are crucial in maintaining business operations. As our customers’ energy partner, the Company conducts joint strategic meetings with said customers to anticipate their long-term energy requirements to support future expansion plans through the latest power solutions and technologies.

MERALCO’s subsidiaries specialize in beyond-the-meter energy services such as solar solutions, value engineering, operations and maintenance and civil works for large electrical infrastructure.

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MERALCO employs a total of 5,569-strong workforce, a good 56% of whom are within the 30-50 age group and who occupy 14.8% of the Management rank.

Notably, each one of MERALCO’s employees received developmental training in 2016. An average of 42.5 training hours per employee was completed at Managerial Level, 15.4 average training hours at Supervisory Level and 28.2 average training hours at Rank and File Level.

EnGAGEd And SAFE WORKPLACE

MERALCO works to deliver electricity efficiently and safely, while looking after its employees, customers, suppliers, contractors, the public and the environment. The Company continuously strives to improve safety and resiliency performance throughout the industry.

MERALCO’s Zero Lost Time Incident (LTI) Program is aligned with the Department of Labor and Employment (DOLE) requirements through the reclassification of incidents and improvements in incident management. Certified for the OHSAS 18001 and ISO 14001 standards, the Company continues to improve its ESH Management System at par with global best practices.

The Safety, Occupational Health and Environment Management Office works relentlessly to improve the Company’s safety culture. Focusing on caring for people and leadership commitment, the Networks Operational Safety Council was created to ensure that specific tasks involving significant hazards are properly assessed and addressed.

As one of the largest utility providers in the country, MERALCO aims to further strengthen safety and develop organizational resiliency through the creation of the Business Continuity Management organization focusing on the strategy and governance of the company’s business continuity plans.

3,119

Executives

Middle Management

rank and File

Under 30

Over 50

30 to 50

Man-hours Exposure

No. of safety drills conducted

11,677,986 62 safety drills; 22 emergency drills (sectors/subtransmission services); 38 emergency drills (business centers/auxiliary);

2 emergency drills (MERALCO operating center)

G4-10

Employees by rank

635

605

4,329

Employment by Age range

1,3331,333 1,117

3,119

Fatality

0

Severity Rate

32.11

2016 Safety Performance

More than 11 Million man-hours exposure with zero fatality and 97.24% improvement on severity rate* to 32.11 in 2016 from 1,164.61 in 2015.

* Severity Rate is the total days of disability multiplied by one Million over the total man-hours of exposure (total days lost x 1,000,000 / employee hours of exposure)



As MERALCO continues to address the growing needs for energy of its more than six Million customers, it also aspires to be a partner in progress for the country. MERALCO embraces this mission by embedding sustainability and by creating shared value that benefit both business and society.

Corporate Social Responsibility (CSR) in MERALCO is about enabling opportunities for many Filipinos to be empowered and rise above the challenges of poverty. Many of its concrete expressions of nation-building are led and sustained by

One MERALCO Foundation through its various social development programs nationwide.

The Foundation strengthened and developed programs focusing on its four pillars: community electrification, grassroots partnerships, youth development, and emergency preparedness and disaster response. Through proper alignment of CSR thrusts with MERALCO’s business goals and strategies, and by involving stakeholders in the process of designing and implementing development initiatives in their own communities, the Foundation plays a critical role in social development.

G4-SO1

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For its Community Electrification initiatives in 2016, One MERALCO Foundation continued its partnership with MERALCO’s Customer Retail Service group to energise 6,756 low income households in MERALCO’s franchise area. This was 135% of the original target of 5,000 households for the year, driven mainly by the strengthened relationships with various local governments, partnerships with urban poor homeowners’ associations and more disciplined project management.

Twenty-nine out of the 38 MERALCO business centers and auxiliary business centers participated in this year’s program with a total of 132 projects approved with an average of 52 households per project. Sitio Camcam in Barangay Canlalay, Binan, Laguna was the single biggest project of 2016 with 452 households energized and another 48 households to be completed by the end of 2017. This was followed by the 234 households of Taytay Sunrise Residents and Planters Association in Taytay, Rizal.

This program also supported MERALCO’s prepaid electricity program by bringing in 2,500 customers located in Rizal (Taytay and Cainta), Manila (Sampaloc, Sta. Cruz, Sta. Mesa, Sta. Ana, Tondo, and Baseco), Pasig (Sta. Lucia)and Novaliches. The prepaid metre system allows customers to monitor their electricity consumption, helping them budget their consumption and expenses. With prepaid meters installed, customers are able to save up to 20 percent in terms of cost.

This project was further strengthened with the call of Philippine President Rodrigo Duterte for various power distribution utilities to beef up electrification for low-income households all over the country. President Duterte asked MERALCO to look into Aroma Compound in the Baseco Area of Manila and the Foundation responded with the electrification of 507 households in 2016. The Duterte administration has set a 100 percent

electrification target for the entire country by 2020 as part of its vision to spread the benefits of economic growth to the grassroots level.

The foundation also worked with a group of university students for “Project Liwanag,” which energized 125 Aeta households in Sitio Bilad and Sitio Caoayan, Capas, Tarlac through solar photovoltaic (PV) system. The foundation also enhanced the electrification of Green Earth Heritage Farm in San Miguel, Bulacan as well as installed streetlights for 240 households in the transition housing for families displaced by Typhoon Yolanda in Tacloban in cooperation with the Philippine Disaster Resilience Foundation.

Meanwhile, the foundation’s School Electrification initiatives reached a milestone of 170 schools energized, 50 of which were accomplished in 2016. These schools are located in 12 provinces, namely: Iloilo (9), Rizal (7), Davao del Sur (6), Bohol (6), Camarines Sur (5), Masbate (5), Tawi-tawi (3), South Cotabato (3), Palawan (2), Occidental Mindoro (2), Oriental Mindoro (1) and Camarines Norte (1). These schools serve a total of almost 23,000 students in the elementary and secondary levels. The programs also enabled 666 teachers to use educational multi-media equipment donated by MERALCO employees through the MERALCO Employees Fund for Charity (MEFCI).

As the School Electrification programs has been running since 2012, the foundation decided to commission the University of the Philippines Public Administration Research and Extension Services Foundation, Inc. (UPPAF) to conduct an impact evaluation on the programs. Some insights from the study are the following:

• Technology has complemented the traditional teaching methodologies and yielded learning gains, and teachers are now able to offer topics they could not teach before.


• Productivity increased since teachers and students are able to use various equipment. As a result, students’ skills are enhanced and students become more creative and innovative in their schoolwork and assignments.

• Record keeping and report preparation have also become easier for teachers since they can utilize digital tools.

• Electrification opened up more opportunities for the schools since donors are encouraged to donate especially electronic equipment because of the availability of electricity.

2016 also saw the implementation of the “One Child, One Lamp” program, in partnership with the Department of Education (DepEd). The program provides one solar lamp per student in remote public schools with a population of 100 and below.

After raising funds for solar lamps from an employee-Christmas campaign in 2015, 10,000 solar lamps were distributed to 140 public schools in 24 provinces. Employees from various interest groups volunteered to help in the distribution: the mountaineering club distributed to schools in the mountains of Sagada in Benguet province, a biking club brought lamps

to Banaue in Ifugao, among others. The lamps were also given to schools severely affected by different typhoons such as Typhoon Ferdie in Batanes and Typhoon Lawin in Cagayan.

As an annual activity, MERALCO network engineers also visit and check the electrical facilities of public schools within MERALCO’s franchise area as part of its “Safe Ang School Ko” campaign during the “Brigada Eskwela” program of the DepEd. In 2016, MERALCO engineers visited 400 public schools for electrical safety checks.

Coupled with the electrification of schools is the development of learning programs aimed at improving the appreciation of teachers, students and their families of energy issues affecting people’s lives. In 2016, the foundation released Energy Education kits which contained at least 150 lessons on the science of energy integrated in various subjects. More than 200 teachers and 73,359 students are now able to use knowledge, activity and project-based learning flashcards to introduce and strengthen lessons in energy.

Energy camps for teachers were held in Subic, Zambales and in Pasig City to help them integrate these in their regular lesson plans.

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This was a follow-up to the two energy camps held in Dumaguete City (Visayas) and Cagayan De Oro (Mindanao) in 2015. In 2017, at least a thousand energy kits will be distributed to various public schools nationwide.

For its Grassroots Partnerships, the foundation partnered with MERALCO’s business centers and network offices in helping local governments, foundations, and social services institutions deliver various programs in their respective communities in the franchise area. In 2016, 92 community relations projects were either initiated or supported. These projects range from medical missions, donation of school and office equipment, participation in local sports fests, donation of sports equipment, tree-planting activities, relief goods for fire victims, etc.

As for its Youth Development focus, the foundation contributes through programs that promote excellence in education, sports and the arts.

An example is its MVP Academic Achievement Awards that started five years ago, which has recognized over 1,407 student dependents of MERALCO’s supervisory and rank and file employees. These dependents, who have excelled academically, receive educational grants.

Meantime, also running for five years now, the MERALCO Basketboys Program has engaged thousands of underprivileged children in marginalized communities to improve their basketball skills and become better team players in their schools and communities. Similarly, it continued to help the Football for Peace Program, which attracts children in conflict areas in Mindanao to be trained by our Loyola MERALCO Sparks Football team so they can focus on their football skills rather than be drawn into armed conflict. In the last four years, over 1,322 youth from the Autonomous Region of Muslim Mindanao participated in this program, in partnership with the Philippine Marines. The MERALCO Sparks traveled all the way to Bongao, Tawi-tawi to reach out to children in the farthest communities in the country.

Young Filipinos with passion for the performing arts, specifically, a cappella singing, have a avenue to showcase their talents and polish them under the annual “Akapela Open” competition. After being exposed to various MERALCO customers, the finalists have now used their singing talents to earn extra income by performing in corporate and community events as well as festivals. In fact, its first champion, Acapellago from Malolos,


Bulacan won top prize in the International A Capella Championship in Singapore in 2015.

In terms of Disaster Response, MERALCO is determined to serve, especially in areas of its expertise. MERALCO linemen are sent as power restoration teams to various local electric cooperatives affected by major typhoons that hit the country each year. MERALCO is quick to respond, bringing technical expertise, manpower and equipment to hard hit provinces and helps restore electricity service within a week. Even in areas outside its franchise area, MERALCO’s commitment is to serve the Filipino

in need. This has been true in Typhoon Pablo (2012), Typhoon Santi (2013), Typhoon Yolanda (2013), Typhoon Glenda (2014), Typhoon Nona (2015), Typhoon Ferdie (2016), Typhoon Lawin (2016) and Typhoon Nina (2016).

On top of the power restoration, the response of the rest of the MERALCO employees is reliably immediate. The Foundation does not fall short of volunteers who willingly gave their time, effort, money, and help in gathering, packaging and distributing relief goods to those communities hit by calamities and disasters.

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The Mangyan tribes of Mindoro are among a few indigenous communities in the Philippines which have managed to keep their population stable and hold on to their traditional ways of living for hundreds of years.

Known for being gentle and peace-loving, they are at times defrauded and cheated because they lack knowledge and sophistication to defend themselves from scrupulous people. Fortunately, more and more young Mangyans are stepping up, seeking education and learning more about what lies beyond the confines of their community — to be better able to defend their rights as indigenous peoples.

However, education is a tough challenge for those living in the remotest communities in upland barangay which mostly have no schools, and the very few that do not have access to electricity.

Such is the case of Waring Elementary School in Bulalacao, Oriental Mindoro, where about a hundred Mangyan pupils are tutored by seven teachers headed by Warlito Agustin, the school’s principal. After earning a degree in education, one of his toughest assignments as a newbie teacher was in Waring. Without paved roads, the community is not accessible by motorised vehicles. The only way to go there and back is to hike for at least three hours.

The young teacher took it as a personal mission to help the Mangyan youth to widen their knowledge about the modern world and change how they view their future as an indigenous people. However, without electricity in the community, Agustin’s dream of bringing progress to this part of the world remains dim.

For the most part of the school year, he and his fellow teachers are left without a choice but to teach computer and IT concepts, ironically, the old and theoretical way.

This changed in 2016, when the school received a donation of a 1-kilowatt solar photovoltaic equipment from One MERALCO Foundation.

Waring Elementary School was among the 50 remote public schools benefited by the foundation’s school electrification program in 2016. The five-year-old advocacy provides an alternative source of electricity to schools located outside of the electric grid, whether within or outside of the MERALCO franchise area.

Since 2012, the program has already enabled technology-aided learning through solar power in 170 schools nationwide, the farthest of which is a school in the island municipality of Sitangkai, Tawi-Tawi. It is the farthest island in southwestern Philippines and is, in fact, closer to Malaysia than to mainland Mindanao.

Apart from the solar equipment, every school energized by the foundation also received a multimedia package consisting of a laptop computer, 45-inch LED TV, and a printer-scanner - photocopier machine donated through monthly contributions by MERALCO employees.

With electricity now available in their school, coupled with the continued dedication of Agustin and their teachers, Waring Elementary School pupils are finally able to experience technology and learn in the same way most children across the world do.

Making a teacher's dream come true


GLOBAL BUSInESS POWER CORPORATIOn

Global Business Power Corporation (GBP) — a joint venture among Beacon PowerGen Holdings, Inc. (56%), JG Summit Holdings, Inc. (30%) and MERALCO PowerGen (14%) — is a leading energy company in the Visayas Region and Mindoro Island.

The company produces adequate, reliable and cost-efficient power supply through its five subsidiaries that operate eleven power generation facilities:

The Cebu Energy Development Corporation (CEDC) owns and operates a 246MW clean coal-fired power plant located in Toledo City, Cebu, which started commercial operations on February 26, 2011. CEDC is a consortium composed of GBP, Aboitiz Power Corporation, and Vivant Energy Corporation. The CEDC Plant utilizes the latest Circulating Fluidized Bed (CFB) boiler technology, setting the beginning of a cleaner transitional technology that not only supports the fast-growing economy of Cebu but also addresses the region’s need for improved environmental management.

The Panay Energy Development Corporation (PEDC) owns and operates a 164 MW clean coal-fired power plant located in Brgy. Ingore, La Paz, Iloilo City, which started commercial operations on March 26, 2011. The PEDC plant uses the same state-of-the-art clean coal technology of the CEDC Plant. With the emergence of PEDC in the market, it has effectively reduced the cost of electricity and addressed the electric power shortfall in the Visayas region. The company is undertaking the 150 MW PEDC Unit 3 Expansion Project that will supply the growing energy needs of Panay and the rest of the Visayas.

The Toledo Power Co. (TPC) owns and operates a 60 MW coal-fired power plant located in

Daanlungsod, Toledo City, and a 40MW diesel-fired power plant located in Carmen, Toledo City. Under the tutelage of the engineers of CMS Generation Company, and later of Mirant, TPC brings with it more than 30 years of technical expertise following world-class standards. In 2014, TPC switched-on its 82 MW TPC1A Expansion Project, to provide the energy requirements of Carmen Copper’s mining expansion projects.

Panay Power Corporation (PPC) owns and operates four diesel-fired power plants. In Iloilo City, it has the 72 MW Iloilo 1, and the 20 MW Iloilo 2 facilities. In Aklan, it operates the 7.5 MW Nabas plant and the 5 MW New Washington plant. The 72 MW diesel-fired power plant, formerly belonging to First Generation Holdings and First Private Power, began commercial operations in 1998 and supplies power to Iloilo City. Meanwhile, the Aklan power plants began commercial operations in 2005 to serve the needs of the Municipalities of Nabas and New Washington as well as the Boracay Island.

GBH Power Resources, Inc. (GPRI) owns and operates a 7.5MW diesel-fired power plant in Pinamalayan, Oriental Mindoro. Built by Mirant, the plant services in part, the power requirements of the province through the Oriental Mindoro Electric Cooperative, Inc. It was officially acquired by GBP in 2003, and subsequently acquired its Integrated Management System accreditation in 2010.

Aside from these five power generating subsidiaries, GBP also has the Global Energy Supply Corporation (GESC) which is its licensed Retail Electricity Supplier (RES) and the official retail energy arm of GBP. The deregulation of the power industry has enabled GBP to actively participate in Retail Competition and Open Access. In this stage of the deregulated market,

53Power

GESC is able to trade energy directly to qualified customers — industrial and commercial end users.

GESC provides sound energy solutions to meet the varying needs of the contestable customers. GESC, sourcing supply from GBP’s power generation facilities that are capable of supplying base, intermediate, peak load and ancillary services to the grid, is capable of offering

a menu of service options at competitive rates and flexible schemes that can be customized depending on one’s power requirements.

As of December 31, 2016, MPIC’s effective ownership in GBP was at 47.1% through Beacon PowerGen Holdings Inc., and through MERALCO PowerGen.


GBP has carefully chosen the location of its plant facilities. Understanding the limitations of transmitting power from island to island, GBP has installed its generation facilities within high growth areas in the Visayas and near its key offtakers. This reduces chances of supply disruptions and allows the Company to deliver adequate, reliable and cost efficient power supply.

GBP strives to be the leading and most efficient energy provider in the country by using technologically advanced circulating fluidized bed boiler technology in its Cebu and Iloilo facilities and at the same, continually improving its plant operations, business processes and systems. Having relatively new coal-fired generation facilities that are equipped with the latest technology, GBP has relatively low operating costs due to efficient use of fuel and lesser operational maintenance.

In 2016, the duration of forced outages of coal-fired plants decreased by 57.50% while frequency decreased by 50%, mainly due to fewer incidents of boiler tube leaks.



Contributed to the doubling of Iloilo City’s electricity

consumption in a span of

7 yearsCustomer Satisfaction Rating at

4.58 (highest) and 4.25 (lowest)

With 983

employees, and

5 Million total manhours for employees

and contractors Adopt-a-Health Center and medical missions

benefited over

46,000 people

Capital expenditures of ₱3.79 Billion

Duration of forced Outages

frequency of forced Outages

Duration 2015

Occurrences

No. of Days

Frequency 2015

Duration 2016

Frequency 2016

CEDC U1

50

40

30

20

10

0

CEDC U1

CEDC U2

CEDC U2

CEDC U3

CEDC U3

PEDC U1

PEDC U1

PEDC U2

PEDC U2

TPC 1A

TPC 1A

15

12

9

6

3

0

Total Scope 1 GHG Emissions -

3,771,370 t CO2 and Scope 2 GHG Emissions

160,019,258 t CO2

Forced outages of coal-fired plants

decreased by

57.5%

G4-EN15, G4-EN16

55Power

GBP also takes pride in having business processes that are aligned with global efficiency standards. The Company follows processes that support strong customer focus and continual improvement, as a recipient of ISO 9001:2008 certification for its power plant facilities and corporate office. Below is the list of certifications under quality, environmental and occupational health and safety management:

Company CertificationsCorporate Office

GPB

• ISO 9001:2008 Quality Management System

Operating Plants

PEDC, PPC, GPRI, TPC, CEDC

• ISO 9001:2008 Quality Management System

• ISO 14001:2004 Environmental Management System

• OHSAS 18001:2007 Occupational Health and Safety Assessment Series

The Company also adopted the best practices in running coal-fired and diesel-fired power plants when GBP acquired TPC from Atlas Mining and Panay Power Corporation from the Lopez Family. The operations under TPC has given more than 30 years of technical expertise in operating coal-fired power plants.

For operations in Iloilo, dredging of the south channel of Iloilo Strait was completed in April 2016 to accommodate bigger coal shipments and reduce fuel cost. Delivery through the dredged channel commenced last March 17, 2017 and has translated to freight cost reduction to USD 10/MT from USD 16/MT, effectively decreasing PEDC’s electricity fees by ₱0.2/kWh.


SERvICE ExCELLEnCE

GBP is committed to provide adequate, reliable and cost-efficient power supply to fuel the development of existing and emerging markets in the country. Back in 2008, the Visayas region experienced rotating brownouts due to tight power supply. GBP immediately addressed the increasing energy requirement in the region by putting up a 3x82 MW clean-coal power plant facilities in Cebu through CEDC and a 2x82 MW plant facilities in Iloilo through PEDC.

With the establishment of PEDC, the contract of Iloilo City’s distribution utility Panay Electric Company (PECO) with PPC (diesel) was replaced with PEDC (coal) to lower down the cost of electricity by ₱3/kwh.

The commercial operations of CEDC and PEDC’s baseload facilities in the first quarter of 2011 not only ended the rotating brownouts in the Visayas but also spurred growth in business and commercial activities.

With the assurance of stable and cost efficient power supply, major industries in Cebu like the mining, tourism, and retail shopping industries flourished. Iloilo similarly witnessed a dramatic resurgence of business and emergence of new industries like business process outsourcing (BPO). Retail shopping Centers, hotels and infrastructure projects were built rapidly. Investments from top property developers such as Megaworld, Ayala Land and the Metro Retail Stores Group also began to pour in. In merely seven years, Iloilo City’s electricity consumption doubled, from 23,533,485 kwh in January 2010 to 49,330,449 kwh in December 2016.

CebuCebu Chamber of Commerce and Industry

Metro Cebu Developments

Department of Energy Demand/Supply Scenario and Effects of Renewable Energy Plants Entry

National Grid Corporation of the Philippines

Transmission Development Plan and Updates

2016 Customer forum Topics

Western Visayas Regional Growth Rate vs. Electricity distributed to Iloilo City

GBP keeps an open line of communication with its customers. One way it does this is through its annual Customer Forum in Cebu and Iloilo where GBP convenes its customers and shares updates about the Company’s plant and commercial operations. GBP invites industry players as guest speakers to keep customers abreast to industry developments and new regulations. Below are the topics discussed during the Customer Forum 2016:

3.40%

5.20%

8.30%

2010 2011 2012 2013 2014 2015 2016

60,000

50,000

40,000

30,000

20,000

10,000

Western Visayas GRDP

MWh Delivered to PECO

57Power

IloiloImpact of Distribution Systems with Distributed Renewable Energy Sources

GBP’s commitment to develop the skills of its people has also extended to its partner distribution utilities and electric cooperatives, which, in the long run, benefits the consuming public. GBP has been conducting technical and non-technical trainings to its customers to improve their business systems and operations, providing them supplemental skills and knowledge which they can apply to their daily operations.

In Cebu, two non-technical trainings were conducted for both CEDC and TPC customers in cooperation with AGF Consulting Group. Topics included Customer Service Excellence and Supervisory Skills Development. In partnership with the MERALCO Power Academy (MPA), GBP also conducted a technical training on Distribution Impact Study. Likewise, MPA conducted customer-centricity trainings in Iloilo for the customers of PEDC and PPC. The trainings involved lectures and workshops designed to engage the participants, who provided positive feedback and cited the trainings’ usefulness in their day-to-day operations.

subsidiary 2016 2015 PEDC 4.25 3.80 CEDC 4.56 4.25 TPC 4.58 4.68

Meanwhile, the commercial group launched the web-based Automated Trading System dubbed GETAPP or Global Energy Trading Application. Developed by Acasiasoft, GETAPP is designed to make the trading process — including Daily Generation Timetable (DGS) Nominations and Bilateral Contracted Quantities (BCQ) Declarations — faster and more efficient. GETAPP is also capable of generating nomination summary reports. Initial implementation is set on February 2017. In line with its trial operations various roll out sessions were conducted in both Cebu and Panay sites.

GBP values the feedback of its customers and conducts customer surveys twice a year to measure how the customers rate its technical/operational performance, power generation billing, and customer care:

Department of Energy ER 1-94 Orientation

Energy Regulatory Commission

RCOA Implementation

Philippine Electricity Market Corporation

Visayas Market Updates

5 being the highest and 1 being the lowest



GBP recognizes the crucial role its people play in the attainment of the Company’s goals, and has continuously invested in the development of its workforce’s skills. To this end, the Company is developing the GBP Training Institute (GTi) in Iloilo, the country’s first and premiere training facility dedicated to foster technological advancement in the power generation industry. At the heart of GTi will be the Circulating Fluidized Bed (CFB) boiler simulator that seeks to promote better understanding of clean coal technology. The institute shall also serve as the hub of GBP’s learning and development programs, and will house training facilities related to GBP’s operations and maintenance practices.

At present, the company maintains employee engagement through various HR and ER programs which are conducted at all sites on an annual basis. These include activities such as team building activities, sportsfests, anniversary celebration, and Christmas parties for employees. The company also has wellness programs that include the employee Annual Physical Examination (APE)/Executive Check-up (ECU). The company gives out health advisories and reminders regularly, and at every flag ceremony, office exercises are routinely taught and practiced together.

59Power

No. of Employees representation Percentage

810 male employees

122

173 female employees

26

15%

15%

GBP ensures that necessary measures are in place to assure the safety and security of the workplace. A hazard-free environment is the company’s aim at all times. Management and employees work together to ensure that people have the knowledge and support systems necessary to maintain a safe workplace and a safety-empowered workforce.

Total Workforce in Health and Safety Committee

Employment by Gender Employment by AgeEmployment by rank

G4-10, G4-LA5

810173 232 198547

358

57

21

553

Female

Male Over 50

Under 30

30 to 50Management and senior Management Officer

Executive

rank and File

Officer


GBP strictly implements a structured Safety Program across all its subsidiaries and plant sites which begins even before people step onto a site. First, new entrants are inducted on the Site’s Safety policies prior to entry in the power plants. This ensures proper communication of various hazards and safety procedures, and strengthen implementation and compliance for all visitors and employees. The Safety Induction is a requirement to gain entry to any GBP power generation plant.

The plants likewise practice Hazard Zoning and Personal Protective Equipment (PPE) mapping by classifying areas according to degree of hazards. This system also defines the applicable PPE in specific areas. In line with the Company’s safety communication policies, safety signs are strategically placed to convey prevailing hazards and corresponding warnings. Activities inside any GBP power plant, which may pose hazard, are governed by a Permit-To-Work process, and a No Permit-No Work policy is strictly observed.

GBP also communicates its Life Saving Rules (LSRs) as clearly and frequently as possible. The LSR are safety rules relevant to the company’s operations that require mandatory implementation and for which there will be minimum tolerance. Non-observance of an LSR exposes a person to a life-threatening situation.

Only qualified personnel are authorized to work on electrical systems whether energized or non-energized and a firm “No Working Alone” policy is enforced alongside strict observance of Life Saving Rules within Company premises. GBP has set a rigid competency requirement for its

electrical personnel who are expected to work in close proximity with hazardous voltages.

The Behavioral-Based Safety (BBS) program is GBP’s proactive approach to preventing accidents. Each GBP employee and/or contractor is engaged to identify unsafe acts and conditions and is authorized to intervene so as to avoid any untoward incident. A Safety Observation System is implemented to report and document hazards flagged by an employee/contractor so that proper actions are put in place. Safety is also incorporated in the Company’s Individual Work Performance Appraisal System.

Mandatory safety trainings are established for those employees and contractors who may be exposed to hazardous conditions. A Training Passport system is implemented to identify and monitor the compliance with GBP’s safety training requirements.

All contractor activities are covered by established safety policies, and GBP carefully integrates its safety requirements in its contractor selection and evaluation process. All contractors go through the site safety orientation to ensure all relevant GBP policies are communicated accordingly.

As pro-active Emergency Prevention and Response, each plant and facility has a variety of fire suppression, alarm, and detection systems that are regularly inspected, tested and maintained to be ready and available in times of need. Emergency response procedures are established per site and necessary trainings and drills are undertaken.

The Company has also established a hearing conservation program for all employees, contractors and visitors. This seeks to prevent hearing loss from exposure to hazardous noise levels associated with the Company’s operations.

GBP similarly enforces strict requirements for the use of company vehicles. Authority to Drive is given only to employees and contractors who have successfully passed the Company’s driver assessment process. Each site also follows an established road safety and travel management program.

In the same proactive approach, GBP incentivizes groups and individuals who make significant contributions to promoting safety in the workplace. These recognition programs are established per plant facility, and form the backbone of the Company’s safety culture.

This safety culture extends to GBP’s neighboring communities. As part of GBP’s community development programs, each site conducts periodic trainings and drills involving residents in surrounding areas. GBP also conducts joint emergency exercises with the local emergency response units to strengthen their response capability for accidents and disasters.

All GBP sites are OHSAS 18001 Certified. Internal, external and corporate audits are conducted periodically to ensure each plant is compliant to regulatory and corporate policies. Site inspections are also performed at intervals by each site’s ESH Committee. All results of audits and inspections are subject to review by the respective Site Management teams and the ESH Committee.

Many of these safety policies and programs have begun gaining recognition from various regulatory bodies. In 2016, GBP subsidiary Panay Power Corporation (PPC) was recognized by the Department of Labor and Employment (DOLE) at the 10th Gawad Kaligtasan at Kalusugan (GKK) Awards as a Silver Awardee in the Power Generation Industry. The biennial GKK is a national award given to organizations and individuals who have shown exemplary practices in responding to the safety and health needs of workers, workplaces, and communities. Selection of winners is based on a rigorous criteria covering various facets of workplace safety, such as Occupational Health and Safety (OSH) Policy, Safety Control, Emergency Preparedness, Industrial Hygiene, Occupational Health, Environment Protection, OSH Capability Building and Information, Social Accountability and Community Relations, and OSH Management.

Meanwhile, CEDC also received a Certificate of Recognition from the Workplace Advocates on Safety in the Philippines, Inc. for having achieved Zero Lost Time Incident from January to December 2015.

61Power



GBP believes in developing sustainable communities. Together with its partners, GBP creates opportunities for growth through social development programs that aim to create a brighter future for its host communities.

Environment is a key pillar for GBP’s social development programs. The Company is committed to the care of forests and watersheds, and stewardship of natural resources for the benefit of the next generation. It is fitting, therefore, that GBP’s flagship carbon sink programs are termed after the vernacular equivalent of “legacy” in its areas of operations—Kabilin in Cebu and Handumanan in Iloilo.

Under Kabilin, GBP has rehabilitated 100 hectares of forestland in the Malubog Watershed Area in Cebu, which supplies the water requirements of Toledo City and other neighboring communities. As part of its biodiversity and aquifer conservation efforts, the Company, through Handumanan, has also spearheaded the development of the

Iloilo City Bird Sanctuary and Wetland Park that covers 35 hectares of mangrove area adjacent to its power generating facilities. The project also includes the nine-hectare GBP Eco Park. Completed in 2015, the GBP Eco Park is another carbon sink project featuring a fishpond, an orchidarium, an organic vegetable, and medicinal garden, and a bambosetum housing 12 different species of bamboo. The park further aims to foster an environment-conscious community.

For its tireless efforts to promote protection and conservation of the environment, GBP has earned various recognition from both the public and private sectors. In 2015 during the Environmental Congress, Cebu Energy Development Corporation (CEDC) was awarded the Sustainability Champion Award and the Climate-Smart Leadership Award jointly conferred by the DENR, the Department of Trade and Industry (DTI), the Department of Tourism (DOT), the Department of Science and Technology (DOST), and the DOE.

G4-SO1

63Power

Meanwhile, the company’s multipartite monitoring teams (MMT) for its Iloilo and Toledo operations, composed of various government and community stakeholders of the plants, were awarded Best Management Practice on Conflict and Best Management Practice on Reporting, respectively, during the 2015 MMT National Convention.

Education is also central to GBP’s social development programs. Through GBP’s Education Assistance Program, deserving elementary and high school students are given grants in the form of school supplies, uniforms, books, and financial assistance. The program has already provided for 662 students during school year 2016-2017. GBP also supports the Department of Education’s annual Brigada Eskwela program.

The Company’s subsidiaries also support its customers in the conduct of their own social responsibility programs. In the past, CEDC partnered with Mactan Electric Company, Inc. for the latter’s school bag distribution project. The school bag distribution project has reached out to 300 Grade 1 students of Punta Engano Elementary School.

GBP also regularly conducts teacher trainings to enhance teachers’ skills and provide them with applicable learning methods appropriate to the grade level they teach within K-12 education program.

662

Scholarships Teacher’s Training

122

784TOTAl

Education Assistance Program Investments and Beneficiaries

Marvin Natural, presently a Grade 10 student in Toledo National Vocational School in Toledo City, Cebu joined GBP’s scholarship program when he entered High School. Marvin still recalls that he used to be an average student. “My grades were mostly in the line of 80+ when I was in elementary,” Marvin said. Since he became part of the scholarship program, Marvin was able to focus more on his studies and was motivated to achieve higher grades. Today, Marvin’s grades are mostly in the line of 90+ and is one of the school’s honor students. He is among the 662 deserving students supported by GBP.

N.J. Elementary School’s School Coordinator and Teacher I Renan Sipe expressed the school’s gratitude to GBP for providing essential assistance to the students. “NJ Ingore Elementary School is very fortunate to be one of the adopted schools in the Division of Iloilo City. As our partner, GBP supports our school and our pupils in realizing the Department of Education’s mission and vision, through their scholarship programs,” said Sipe.

“I have witnessed how motivated GBP scholars are because of the provisions given to them. Apart from the improvement in academic performance, I have also seen the effect in their personal attitude. The program has indeed contributed greatly to the development of the child’s good study habits and self-discipline,” he added.

GBP’s Education Assistance Program not only provides for the students’ needs but, just as important, it helps the school in furthering professional growth of the teachers. They conducted seminars, workshops, and did benchmarking. The program also donated provisions for school facilities.

helping students reach their potential


Patients Served per Age Group

0-6 7-14 15-24 25-34 35-44 45-54 55-6465 and Up0

2,000

4,000

6,000

8,000

10,000

12,00011,370

8,550

3,7214,583 4,692 4,151

3,4182,624

TOTAL: 43,109

Health is another key area where GBP focuses its social development initiatives. To help ensure the health and well-being of its communities, GBP conducts medical missions and provides free medicines to its adopted barangays. Main health initiatives in 2016 included the continuation of its flagship Adopt-a-Health Center program, with 43,109 beneficiaries, and training for barangay health workers.

This approach ensures that community residents have access to common over-the-counter medicines, particularly in times of illness, lessening unanticipated household financial burdens and directing focus to healing.

Adopt a Health Center

Medical Missions

Barangay Health Workers’ Training

43,109 2,922 123

46,154TOTAl

Health Initiative Investments and Beneficiaries

Under the Social Development Program (SDP) of GBP, the Company attends to some of the most basic needs of its beneficiary communities. Through continuous consultation with local government units and residents, the Company was able to identify that public access to health facilities is a key concern in most of its adopted barangays. As such, GBP’s Social Development Program in 2016 focused primarily on the rehabilitation and repair of health centers in the Iloilo, Aklan and Mindoro provinces.

GBP also recognizes the crucial role it plays in disaster response and risk management. In 2013, GBP immediately responded to the victims of the7.2-magnitude Bohol Earthquake and Typhoon Yolanda in the Visayas. In October, GBP provided 1,500 relief bags each to Cebu and Bohol for families affected by the earthquake. When Typhoon Yolanda ravaged Leyte, Samar, Northern Cebu and Northern Iloilo on the same month, GBP was able to distribute 5,200 relief bags in Iloilo, Cebu, Aklan and Capiz through the generous donations received from GBP employees, friends and relatives.

Typhoon Yolanda toppled power and communication lines paralyzing the affected provinces. GBP assisted electric cooperatives in these areas for the immediate repair and restoration of electricity lines. GBP sent boom trucks and coordinated with MERALCO in sending out technical teams to various service areas for assistance. CEBECO II, one of GBP’s serviced electricity cooperatives, was able to fully reconstruct its 69kV sub-transmission line in just 13 days. Power supply to most of the Company’s service areas were restored within 40 days.

65Power

TOTAl

16,482 26,627Total 43,109

Iloilo

12,122 20,323Total 32,445

Mindoro

479 658Total 1,137

Aklan

2,043 3,251Total 5,294

Toledo

1,838 2,395Total 4,233

Beneficiaries of Community Service Program

Social Development Programs

Toledo• Streetlighting Project• Gym Lighting Project• Footpath mixed with Fly Ash Project• Provision of Water Pumps

Iloilo• Day Care Center Rehabilitation Project• Construction of Health Centers• Enhancement and Repair of Existing Health

Centers• Improvement of public CR, with water supply

provision• Installment of street signages• Provision of streetlights

Aklan • Streetlighting Project • Rehabilitation of Barangay Health Center• Provision of Water Pump for Elementary

School Mindoro• Repair of Basketball Court Light post• Rehabilitation of Health Center

Extension Office• Construction of School stage

In recognition of its efforts to support its communities, both CEDC and TPC have been given Special Citations for their corporate social responsibility programs during the Cebu Grand Chamber Awards in 2015. The Special Citation is given to organizations with multitude of relevant projects to their communities.


Maynilad Water Services, Inc. (Maynilad) is the water and wastewater services provider for the West Zone of the Greater Metro Manila area, providing customers with piped-in water supply that meets the Philippine National Standards for Drinking Water of the Department of Health. It is the largest water concessionaire in terms of customer base in the Philippines.

Maynilad is managed by Maynilad Water Holding Company, Inc. which is owned and operated by MPIC, and DMCI Holdings Inc. (DMCI) and Marubeni Corp. The MPIC-DMCI consortium took control of Maynilad on January 24, 2007. As of year-end 2016, effective MPIC ownership of Maynilad was at 52.8%.

Maynilad is an agent and contractor of the Metropolitan Waterworks and Sewerage System (MWSS) for the West Zone of the Greater Manila Area, which is composed of the cities of Manila (certain areas), Quezon City (certain areas), Makati (certain areas), Caloocan, Pasay, Parañaque, Las Piñas, Muntinlupa, Valenzuela, Navotas and Malabon—all in Metro Manila; and the cities of Cavite, Bacoor, and Imus, and the towns of Kawit, Noveleta and Rosario—all in Cavite Province.

Aside from delivering potable water, Maynilad provides sewerage services to its customers. Currently, only residents and establishments in Tondo, Sampaloc, South Manila, Malabon, Navotas, Caloocan, Projects 7 and 8 in Quezon City, Magallanes Village in Makati and parts of Muntinlupa may connect to Maynilad’s sewerage system.

Customers in areas not covered by Maynilad’s sewerage network dispose of their wastewater through their own septic tanks or sewerage treatment facilities (for big commercial and industrial customers). Residential and semi-business customers who are located outside sewered areas and who maintain their own septic tanks may avail of Maynilad’s septic tank cleaning (desludging).

MAYnILAd

Maynilad’s concession area covers over 540 square kilometers. It operates and maintains 3 water treatment plants, 20 wastewater plants, 30 pumping stations, 30 reservoirs, 5 mini-boosters, 30 on-line boosters and 7,637 kilometers of water pipelines.

Maynilad’s customer base has expanded to 1,312,223 service connections or more than 9 Million people. 98.2% of Maynilad customers enjoy 24-hour uninterrupted water supply, while 100% are provided with water service at an average of 7 pounds per square inch (psi) of pressure.

After launching one of the largest and most ambitious NRW (non-revenue water) reduction programs in Asia, Maynilad successfully brought down its NRW level to 29.9% by the end of December 2016. The company replaced a total

69Water

of 196 kilometers of old pipes in 2016, bringing the total length of pipes replaced within its concession area to 1,709 kilometers—about the same distance from Manila to Hanoi, Vietnam—since the company’s re-privatization in 2007.

Maynilad invested ₱1.85 billion for its pipe replacement projects in 2016 alone. The old pipelines rehabilitated last year were located mostly in Quezon City, Manila, and Bacoor City, where “pipe age” ranged from 30 to 40 years. This allowed Maynilad to recover some 48 Million litres per day (MLD) of potable water, which is enough to supply about 79,736 households.

In 2016, Maynilad was able to generate 5,660 jobs from its pipe replacement projects. These jobs include those generated by the contractors and suppliers of the company.

Maynilad’s huge investment in NRW reduction represents its full commitment to rehabilitating the water delivery network in Manila, especially its oldest districts, such as Malabon, Tondo and Sampaloc.

The company’s ultimate goal is to bring NRW down to 20 percent by the current end date of concessions with MWSS in 2022.

Maynilad has generated approximately 228,000 jobs since its re-privatization in 2007. It has invested almost ₱100 billion in rehabilitating and expanding its water distribution network, upgrading facilities, and enhancing wastewater services. These projects required the employment of more than 228,000 people to date, including those hired by contractors and suppliers that rely on Maynilad as their major client.


• Service Coverage: 94.3%• Maynilad Concession• la Mesa watershed


The Philippine company with the most number of ISO certificates passed

across multiple sites for 56 offices and facilities

2,229

4,208,092

110,000

19,400

Man Hours No Lost Time Accident

Youth Participants in Daloy Dulong to Date

Beneficiaries of Samahang Tubig Maynilad to Date

Total Employees

71Water

2015 2016

Total water withdrawn

847 Billion litres

907 Billion litres

Total Pipe Network

7,575 km 7,637 km

117 km 62 km822

Billionlitres

865Billionlitres

Total water ProducedNew Pipes laid

Man hours No lost Time Accident (MHNLTA)

Productivity Index

1.7 persons/thousand connections

1.7 persons/thousand connections

3,847,6284,208,092

Non-Revenue Water (NRW)

31.1% 29.9%

Total Population Served

9.2 Million9.3 Million

CAPEX

₱9.4 Billion₱10.1 Billion

57.1 Billion litres

57.9 Billion litres

Treated water DischargePollution Prevented

8.5 Million kg

6.5 Million kg

G4-EN8



Maynilad fully appreciates the importance of ensuring the sustainable relationship of its operations with the environment, because it draws on natural resources to supply water to its customers, and its wastewater services directly impact the state of waterways and river systems.

Certified for ISO 14064:2006 since 2009, Maynilad has been implementing an Inventory Management Plan that includes the conduct of an annual GHG and Air Pollutants Inventory. With this, the company can set accurate targets, systematically monitor reductions, and develop a fair comparison for assessing the impact of its reduction initiatives. Moreover, this also sets in place protocols that would verify and validate its GHG/AP emission findings.

Maynilad uses the Operational Control Approach for defining its organizational boundaries, or those that distinguish which emissions it directly and indirectly produces. This means that Maynilad accounts for all emissions from sources that it controls operationally.

Maynilad organized a “Green Team” — a cross-functional team composed of employees from different operating units — to ensure that the inventory plan and emissions calculations cover the entire organization. These select employees received technical training and assistance from the Philippine Business for the Environment (PBE) and Clean Air Initiative - Asia so they could develop the necessary framework and processes for determining the company’s emissions.

Though Maynilad’s total emissions increased due to water service coverage expansions and the rehabilitation of wastewater treatment plants, the company was able to make its operations more efficient. Maynilad benchmarks its emissions against select companies all over the world engaged in water production and distribution.

As part of its commitment to its stakeholders, Maynilad continues to innovate in order to improve operational efficiency and optimize its carbon emissions. It seeks to sustain the decreasing trend in its GHG intensity, to lessen detrimental impacts to the environment.

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Case in point is Maynilad’s uniquely designed unified IT (information technology) and OT (operational technology) system called Field MOUS (Field Monitoring User System). It is a set of software modules designed for plantwide monitoring and analysis. It also comprises a system data archive that handles the collection, storage, and retrieval of data and also acts as a data repository for all applications.

Ultimately it allows management to understand where the business stands operationally at any given moment in time. Field MOUS is Maynilad’s IoT platform, enabling sensor data to be viewed, virtually in real time, at the central control room. With innovations such as this, Maynilad was able to obtain an ISO 20000:1 certification for its information technology service management system, and also received the SAP Customer Center of Expertise certification for its efficient business processes.

Another path to operational efficiency has been the company’s massive metre replacement (MMR) program in support of the NRW drive. The program focuses on replacing faulty meters to achieve correct metre sizing relative to true consumption. The MMR program was put in place under Maynilad’s Integrated Metre Management system.

The Central Non-Revenue Water (CNRW) Division which oversees the company's water loss reduction program, recently secured three ISO certifications from international auditing and certification body TUV Rheinland Philippines.

A total of nine certificates were awarded to three CNRW sites—its headquarters in Makati, Leak Detection Management office in Manila, and Integrated Metre Management laboratory in Pasay—after passing the strict audit for three management system standards: ISO 9001:2008 (Quality Management System), ISO 14001:2004 (Environmental Management System) and BS OHSAS 18001:2007 (Occupational Health and Safety Assessment Series).

These certifications confirm that Maynilad meets international standards in its NRW-related systems and processes, which cover pipe replacements, leak detection and repair, and metre management. In fact, the company has reduced its NRW from 31% to 30% in 2016 which is equivalent to 9 Million litres per day. This recovered volume is enough to fill up roughly 3.5 Olympic-size pools every day, and supply about 1.5 Million households with potable water.

Maynilad’s NRW Reduction Program includes the regular replacement of old pipes. Since 2008, the company was able to replace a total of 1,709 kilometers of pipes, which is about 43% of the total water network Maynilad inherited after re-privatization in 2007.

Moreover, the company continues to operate state-of-the-art leak detection technologies. This enabled Maynilad to repair 27,936 pipe leaks in 2016 alone, bringing the total number of leaks repaired to 290,180 since 2008.

Maynilad’s NRW reduction program also includes metre and pressure management, active leakage control, primary line assessment, selective pipe replacement, and District Metreed Area (DMA) management. The company has spent some ₱18.95 billion for this program since 2008.

As a testament to its earnest pursuit of operational efficiency, Maynilad holds a total 209 ISO certifications as of end 2016 — including a company-wide ISO certification received in 2015. Currently, it holds the distinction of being the Philippine company with the most number of ISO certificates passed across multiple sites for 56 offices and facilities.

For 2016, it was conferred the ISO 50001:2011, certifying the Energy Management System of Maynilad to be world class with regard to La Mesa Treatment Plants 1 and 2, the pumping stations at La Mesa, Villamor, Pagcor City and Pasay, as well as the Tondo Sewage Pumping Plant—all considered vital facilities for operations.

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Aiming to transform its service culture into one that prioritizes customer satisfaction above all key result areas, the company launched the Higit sa Tubig: Isip, Puso at Gawa (“Beyond Water: Mind, Heart and Action”) program in 2015. Then the company designed a comprehensive three-year roadmap from 2016-2018 and is now executing the strategies to transform itself into a cohesive organization that is stakeholder-centric, focused on delivering service-obligation targets.

The company rolled out organizational changes and capacity enhancement, upgrading both personnel and facilities in accordance with the roadmap that would lead it beyond water provision and into a full-line water solutions company.

Facility upgrades included the building of a supplementary pumping station inside La Mesa Compound in Quezon City to improve water pressure and expand coverage in Quezon City and Caloocan.

SERvICE ExCELLEnCE

The ₱428 Million North A Pumping Station Annex will serve more than 84,000 households in Barangays Greater Lagro and Pasong Putik in Quezon City; and Barangays Deparo I and II, Bagumbong, Urduja, Malaria, Barracks, Tala, Miramonte Heights, Mountain Heights, Congressional Housing, Bagong Silang, Zabarte, and Camarin Area A, B, C and D in Caloocan City. Of these over 84,000 households, some 10,000 households will be new customers.

With this new facility, existing Maynilad customers in these areas will experience an increase in water pressure from 7 pounds per square inch (psi) to 16 psi. The North A Pumping Station Annex will also enable Maynilad to bring potable surface water to households that still rely on deep wells, thus improving water quality and availability for the residents.

The construction of this supplementary facility involves the installation of four new pumps to support the existing six pumps of North A Pumping Station, thus increasing its daily water discharge capacity from 150 Million litres per day (MLD) to 430 MLD.

Maynilad has allocated ₱883 Million for the construction of new pumping stations. Other pumping stations currently under construction are in Victoria Homes, Muntinlupa City, and in

Overall Customer Satisfaction Rating

2.99 / 4.00 3.36 / 4.00

2015 2016

G4-PR5

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Magdiwang, Bacoor, Cavite. At present, Maynilad has 30 pumping stations located in strategic locations throughout its West concession area— up from only seven operational pumping stations in 2006 before the company was re-privatized.

The company is also currently constructing six new reservoirs in various locations within its West Concession area to help improve water supply and pressure for its customers, particularly those living in elevated portions. Since 2007, Maynilad has already built 30 reservoirs—up from only eight reservoirs before the West Concession was re-privatized.

The new reservoirs are located in Quezon City, Muntinlupa, Imus City, Cavite City, Bacoor City, and Noveleta in Cavite Province. Once completed around the last quarter of 2017, the impounding facilities will add 23% or 140 Million litres per day (MLD) to Maynilad’s water-holding capacity. This volume of stored water combined is enough to meet the supply requirements of about 1.3 Million Maynilad customers.

On the other hand, Maynilad’s Sewerage service also continues its pursuit of excellence as it is currently laying a sewer network that will benefit some 516,000 people in nine barangays and 95 subdivisions in Parañaque City.

The project involves the laying of about 65 kilometers of sewer pipes with diameter sizes ranging from 200mm to 1,500mm. The project is targeted for completion by the third quarter of 2017.

The Parañaque sewer network will catch, collect, and convey wastewater generated by households in Barangays La Huerta, San Dionisio, BF Homes, Don Bosco, Marcelo Green Village, Moonwalk, San Antonio, and San Isidro to the company’s Sewage Treatment Plant. This will ensure the proper removal of harmful elements from the wastewater, thus protecting community health and the environment.

Funded by the Development Bank of the Philippines and Japan International Cooperation

Agency (JICA), the project is part of Maynilad’s program to expedite the provision of sewerage and sanitation services in Metro Manila.

Meanwhile, for its Septage service, Maynilad reports having cleaned a total of 96,594 septic tanks from around 175,045 households in 2016—a 53% increase from 2015. This enabled the company to collect and treat over 168,047 cubic meters of septage, in line with its goal of protecting the environment.

Maynilad also has a meter laboratory, the first in South East Asia, which is capable of testing large meters ranging from 15mm to 300mm. The facility is also then able to provide testing services for companies that supply water meters in areas outside Metro Manila. The laboratory features an advanced meter test bench that determines the metre accuracy by comparing the volume of water passing through it with its registered reading. This technology enables fast, efficient, and precise measurements of water consumption.

Futhermore, Maynilad runs a Central Laboratory, which monitors and tests the quality of water and wastewater in the West Zone. The Central Laboratory has passed the stringent assessment of DENR which was conducted in the last quarter of 2015, underlining the lab’s high standards when it comes to the quality, accuracy and precision of chemical and microbiological testing.

As such, Maynilad is now authorized by DENR to generate environmental data in connection with the Environmental Impact Assessment (EIA) system, environmental monitoring, and research activities to be used by the government for environmental planning and policy-making.

Prior to the DENR accreditation, Maynilad’s Central Laboratory was conferred with the ISO 17025:2005 by the Department of Trade and Industry (DTI)-Philippine Accreditation Bureau (PAB). It is also accredited by the Department of Health (DOH) as a laboratory for drinking water analysis.


For 2016, Maynilad’s manpower headcount was 2,229 strong.

The workforce gender distribution still toes the industry’s traditional line and is predominantly composed of male employees, at 75% of the population, while the remaining 25% is female. At the Management and Executive positions, though, the percentage of ranking women goes higher at over 36%.

Majority of our employees (75 %) are covered by Collective Bargaining Agreements that are spearheaded by two employees’ associations, namely Maynilad Water and Sewerage Union-Philippine Trade and General Workers’ Organization (MWSU-PTGWO) and Maynilad Water Supervisors Association (MWSA).

Ensuring the health and safety of its workforce, Maynilad constantly creates and strengthens employee-focused programs that show the company’s genuine concern for people’s physical, emotional, and professional well-being. This includes an Annual Physical Examination (APE) program


whose compliance is consistently high at around 99% and an annual vaccination program that negotiates significantly discounted rates for employees and their dependents. This year, there were only six cases of flu and 65 cases of pneumonia.

Maynilad also maintains a drug-free policy, which prescribes the conduct of random drug testing for all employees. These drug tests have a compliance of 99 percent. The company provides support for employees that tested positive for drug use through a rehabilitation program in partnership with a DOH rehabilitation and treatment facility.

The company also closely monitors employees who are at higher risk for hazard exposure, providing preventive measures to ensure safety. 2016 posted 100 % compliance of at-risk employees undergoing blood tests for various chemical components. These yielded results within the acceptable limits.

The safety of Maynilad’s employees is of utmost importance to the company’s top management who make concerted efforts to ensure that all precautions and measure are taken. Maynilad was recognized

Average Training Hours rank

2015 2016

Executive 68.09 65.62

Manager 48.44 50.59

Supervisor 34.13 40.65

Rank and File 15.18 22.50

FemaleMale

Supervisorrank and File

ExecutiveManager

1,002

616611

1,466

401

304

58

1,679

550

Over 5030 to 50Under 30

Employment by Gender Employment by rank Employment by Age range

G4-11, G4-LA9

77Water

by the Safety Organization of the Philippines, Inc. (SOPI) for attaining an all-time high record of 20 Million Man Hour No Loss Time Accident (MHNLTA) in all of its facilities and offices. The outstanding safety achievement is a testimony to Maynilad’s uncompromising commitment to strict health, safety, and environment standards and practices.

SOPI presented an Award of Excellence to Maynilad during the 10th Gawad KKK (Kaligtasan. Kalusugan. Kapaligiran.) ceremony held in Diliman, Quezon City. The award recognizes SOPI member-institutions that provide and maintain a safe and healthy workplace that either result to a Zero Lost Time Accident Record or a significant drop in accidents and injuries.

Maynilad is the only SOPI member- organization that has posted 20 Million man-hours without any incident or Loss Time Injury (LTI).

Increase in safety translates to increase in efficiency, producing an environment conducive

to innovative thinking. And as management adopted innovation as a core business strategy, cultivating an engaged workforce steeped in a culture of innovation became essential.

Maynilad has a workforce composed mostly — over 90% — of engineers, many of whom have been with the company for more than 10 years. And believing that the best people to identify and find solutions for operational gaps are those who handle the operations themselves, the company decided to sponsor an annual competition called “Think Maynilad Innofest” that encourages innovative thinking among employees.

This year, winning ideas were: a lightweight but heavy-duty chamber made from special steel that can serve as a replacement to conventional concrete chambers, and a maintenance-free enclosure that protects air valves from water penetration.



Maynilad has made Corporate Social Responsibility (CSR) an integral part of its business strategy, championing initiatives that promote poverty alleviation, sustainable water management, and community development. At the same time, the company cultivates partnerships for enhanced environmental awareness and extends assistance during times of calamity.

Maynilad’s CSR programs and projects focus on four major areas: Sanitation and Health Promotion, Community Empowerment, Disaster Relief and Response, and Environmental Stewardship.

For Sanitation and Health Promotion, Maynilad’s Daloy Dunong program aims to increase appreciation about the value of water through the conduct of fun and meaningful activities that promote proper hygiene, good health, and environmental responsibility among the youth. More than 350 schools have hosted the program since 2012 and there have been more than 50 off campus engagements. Close to 110,000 youth have been program participants.

Maynilad also has a program called Lingkod Eskwela which is intended for West Zone public schools that have no access to potable water. It involves the construction of drinking fountains, clean-up of water reservoirs or tanks, and regular sampling of drinking water to ensure its quality. To date, 44 public schools have been recipients of this initiative.

Meanwhile, the company has several initiatives for Community Empowerment, including putting up Water Cooperatives. Maynilad and civil society groups partnered to address the problems of water inaccessibility and irresponsible water use in the company’s concession area. Under the project, residents of urban poor communities are organised and given training to make sure that they are capable of sustaining water management programs.

For instance, Maynilad’s Samahang Tubig Maynilad (STM) gives underserved communities access to potable and affordable water. The 13th STM was launched at Riverview in Barangay Batasan Hills, benefitting 60 informal settlers’ families. The program works by organizing an informal settlers’ community into a cooperative-basedw organization. Public faucets are then installed in the program area. The company provides additional support in

G4-SO1

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the form of values formation and skills training on the proper management of faucets.

About 19,400 people have benefited from STM since its inception in 2009. Significant family savings are at ₱300-₱500 a month per household as they no longer need to buy illegally tapped water. Other STM sites are located in Manila, Caloocan, Malabon, and Quezon City.

Also addressing Community Empowerment is the Habing Buhay project which taps communities for gathering fast growing water lilies in waterways and utilizing them as raw material for craft-making. Conducted in partnership with the Villar Foundation, which has expertise in turning dried water lily leaves into sellable items, the project now benefits the residents of Barangay Putatan in Muntinlupa. The participants gained the necessary


knowledge to repurpose the fibers of the water lily plant into functional pieces. The enterprise has grown to include bags, baskets, boxes, and mats that are appreciated by a higher market base. Habing Buhay products were also part of the company’s 2016 corporate giveaways.

In addition, there is also the Sining Ipo program that engages the community of Dumagats in the Ipo Watershed area. Sining Ipo provides an alternative livelihood to the slash-and-burn farming that Dumagats typically live on by fostering their artistic skills as sculptors. The project held a successful exhibit, Sungka Series which was subsequently followed by mentorship from artist Tata Raul Funilas. Dumagat sculptors further learned to produce exquisite wine holders from driftwood. These art pieces were also among Maynilad’s 2016 Christmas giveaways.

For Disaster Relief and Response, Maynilad is committed to its Mission Ginhawa, a program which provides donations of clean water, compact micro-filtration systems and technical assistance, the company strives to deliver relief to those who need it most. The Mission Ginhawa team visited areas in Kalinga, Apayao, Tuguegarao, and Penablanca, Cagayan after super typhoon Lawin struck the region. In addition to providing water relief to the communities hit by signal number 5, community residents were also taught on the proper use of water filters donated.

Maynilad and its Business Areas (BAs) also responded to a minimum of 12 fire incidents in 2016, and essential water supplies were given in aid to the survivors. Furthermore, relief effort partnerships with the MVP CSR Council continued in El Nino-stricken areas in Mindanao.

As for Environmental Stewardship, Maynilad maintains its program called Plant for Life. Originally created to reforest the watersheds in Angat, Ipo and La Mesa, the Plant for Life program is now a multi-site reforestation and afforestation program that includes the areas along the coastlines of Laguna Lake and Manila Bay. For 2016, Maynilad planted a total of 95,700 trees.

Last year, over 1,500 volunteers from Maynilad and its partner organizations planted a total of 70,700 indigenous trees over 58 hectares of the Ipo Watershed, as well as 25,000 mangrove propagules along the Manila Bay coastline in Cavite City, Bacoor City, and the municipalities of Noveleta and Kawit in Cavite Province.

To date, Maynilad has planted around 486,300 saplings—using indigenous trees like Narra, Cupang, Acacia and Alibangbang—in the Ipo Watershed since 2007. Moreover, a total of 112,000 mangrove propagules have already been planted in the Cavite coastal areas since 2013.

Also in 2016, Maynilad, its Parañaque Business Area, and the Parañaque City Government inaugurated 12 FAITH (Food Always in the Home) Gardens. FAITH Gardens is a home food security program with that aims to provide a steady source of fresh vegetables to the Department of Social Welfare and Development’s 4Ps beneficiaries, senior citizens and other marginalized groups within the city. For its part, Maynilad installed 260-gallon overhead water tanks and drip irrigation systems, and provided technical assistance in the setting up of each community garden. The company also conducted Ginhawa Gardening Workshops so residents are equipped with the right knowledge in starting backyard gardens with or without a plot of land.

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Back in 2010, Samuel Macabare was feeling anxious when he heard that Maynilad was starting a wastewater project in their area in Paco, Manila. “They’re putting a treatment plant here? So they’re bringing wastewater here?” was his worried thought.

The Paco Wastewater Treatment plant was built by 2012, with capacity to clean over 410,000 litres of wastewater from residential areas every day.

Samuel was among the 2,000 residents around Estero de Paco who benefited from the refreshed environs that was brought about by the operation of the new facility. Aside from its usual operations, Maynilad also put in place additional wastewater infrastructure to ensure the maintenance of cleanliness for the community’s waterway.

“All the dirty water from the septic tanks and the houses were being filtered and brought to the plant,” said Angelita Imperio, a 60-year old Education graduate and retired teacher who is now a River Warrior from the Pasig River Rehabilitation Commission (PRRC). “It was really a good thing. In the past, so much dirty stuff float down the river, you just couldn’t clean it up! But ever since Maynilad’s project, we couldn’t find any more wastes going downstream.”

An Education graduate of Polytechnic University of the Philippines and a retired teacher, River Warrior Angelita has been a regular volunteer who went down the river to gather trash and cut overgrowing plants. She also helped clean the surrounding

Community spirit brings Estero de Paco back to life

areas of the river and take care of the vegetation around it.

Along with concerned volunteers such as Samuel and Angelita, there are other organizations who have been helping keep Estero de Paco clean. Aside from PRRC and Maynilad, there is the Asian Social Institute, Samahan at Ugnayan ng Mamamayang Makakalikasan, and other private organizations.

Another big factor was the readiness of the community around the Estero to help out and cooperate with clean-up initiatives. “People around here help out in cleaning and planting. Whenever you ask for help, they are always willing to do their part,” said Angelita.

In fact, the community has successfully maintained its initiative of assigning families for the upkeep of their gardens by the Estero. Today, the gardens are producing fruits and vegetables that can be harvested by the families.

The Paco Wastewater Treatment Plant is one of the keys to maintaining cleanliness of waterways, especially since 80% of water consumption in residential areas become wastewater. It is through the cooperation of government, private companies like Maynilad, civil society groups and the community that the continued health and cleanliness of waterways such as the Estero de Paco is ensured.

“Since I was eleven, I’ve always dreamed that we can clean up our Estero. Now it’s a reality,” said Angelita.

TOLL ROADS


TOLL ROAdS

MPIC holds the majority of its toll road assets through its wholly owned subsidiary, Metro Pacific Tollways Corporation (MPTC). MPTC holds a 75.60% effective interest in Manila North Tollways Corporation (MNTC), which holds the concession rights to construct, operate, and maintain the North Luzon Expressway (NLEX) and Subic-Clark-Tarlac Expressway (SCTEX).

Also under the umbrella organization of MPTC are the Tollways Management Corporation (TMC); and the CAVITEX Infrastructure Corporation (CIC) which holds the concession rights for the operation and maintenance of the Manila-Cavite Toll Expressway (CAVITEX).

Manila North Tollways Corporation (MNTC) is primarily in the business of developing, designing, constructing, financing, operating, and managing toll road projects. As builder-concessionaire of toll roads, MNTC runs the 95-kilometer NLEX and the 94-kilometer SCTEX, which set the pace of world-class tollways in the Philippines.

NLEX is the country’s showcase for toll road operations, management and maintenance and customer service with standards comparable to modern toll roads elsewhere in the world. NLEX is the main road artery that connects Metro Manila to some 15 Million people in North and Central Luzon and serves approximately 220,000 vehicles per day.

In October 2015, the Bases Conversion and Development Authority (BCDA) turned over the management, operation and maintenance of the Subic-Clark-Tarlac Expressway (SCTEX) to MNTC. SCTEX, which is accessed by an average of 45,000 vehicles per day, seeks to transform Central Luzon into a world-class logistics hub in the Asia-Pacific region through the integration of economic activities in the

Subic Bay Freeport, the Clark Freeport Zone, and the Central Techno Park in Tarlac.

Tollways Management Corporation (TMC) is primarily engaged in carrying out the operations and maintenance of toll roads, toll road facilities, interchanges and all related works. First invested in 2008, effective MPIC ownership of TMC is at 60% as of year-end 2016.

TMC operates and maintains the 95-kilometer NLEX and the 94-kilometer SCTEX. With uncompromising commitment in serving the Filipino people, TMC is committed to delivering world-class service to motorists and commuters in North Luzon.

In 2016, MNTC opted to change its name to North Luzon Expressways Corp. (NLEX Corp.) and leadership decided on a merger with TMC. These initiatives gained Board approval on October 19, 2016 and November 17, 2016, and were subsequently ratified and adopted by NLEX Corp. stakeholders on November 17, 2016. Meanwhile, TMC stakeholders ratified and adopted the same on December 15, 2016.

As the absorbing entity, NLEX Corp. is seen to benefit from the synergies brought about by its merger with TMC, deriving an enhanced capability to deliver critical public service to motorists plying the Northern routes. This is particularly true in aspects of managerial effectiveness and increased capitalization. The Merger is still pending regulatory approval as of March 28, 2017.

For purposes of this Report, MNTC and TMC will be collectively referred to as NLEX Corp.

Meanwhile, MPTC’s Cavite Infrastructure Corporation (CIC) is charged with the management of the Manila-Cavite Expressway

85Toll Roads

TOLL ROAdS

(CAVITEX). MPIC’s effective ownership of CIC stands at 100% as of year-end 2016.

CAVITEX is a 14-km expressway along the coast of Bacoor Bay after south of Roxas Boulevard which exits to Bacoor City and Kawit. It connects people and enterprise from the southern and western parts of Metro Manila to the provinces of Cavite, Batangas, Laguna and vice-versa. Among regular travelers, it is also known as the Coastal Road.

The establishment of CAVITEX has eased vehicular traffic on a major stretch of road towards Cavite province where an export processing zone is located, along with other businesses and factories as well as residential areas. Travel time going to and from the province of Cavite via CAVITEX has been considerably reduced, benefiting residents and enterprises in the area as well as surrounding municipalities.


Collectively, NLEX Corp. and CIC employs 1,346 people

NLEX, SCTEX, and CAVITEX, served approximately 495,805 vehicles per day

NLEX-SCTEX Integration reduced travel time through the expressway by 40 minutes

CIC

A ₱2.6 Billion road-widening project covering Segments 2 and 3 of NLEX is on-going

The Gusto Ko, Ligtas Tayo program by NLEX Corp. taught road safety awareness to 1,758 participants from 14 elementary schools and 9 barangays

is the first Toll Road in the Philippines to use the Radio frequency Identification (RfID), known as EasyDrive, an electronic payment system which improved vehicle throughout thereby improving lane efficiency by reducing transaction time.

CICThe Road Safety Advocacy called Tropang Cavitex gave lectures on safe expressway driving to 382 buses, trucks, PuJs and other service drivers.



NLEX Corp. officially finished the NLEX-SCTEX Integration Project on March 21, 2016. It was made fully operational just before Holy Week, bringing immediate relief to the anticipated increase in traffic volume. Annually, during this travel period, traffic volume increases from between 10% to 15%.

Providing motorists a faster, more convenient and efficient travelling experience, the project is the first integration among expressways in the country. Completed at a cost of ₱650 Million, the toll collection systems of NLEX-

SCTEX were also converted into a unified system. Toll collection stops from Balintawak to Subic and back have been reduced from five to two, while Balintawak to Tarlac and back have been reduced from four to two stops.

Seven new toll plazas were also constructed throughout the northern expressways to further streamline travel. These include toll plazas in Tarlac, Subic-Tipo, Sta. Ines, and the northbound and southbound sides of Dau and Mabiga. As a result of the NLEX-SCTEX integration, the NLEX

87Toll Roads

Dau and SCTEX Mabalacat barriers have been removed to support the smooth flow of traffic.

Utilizing a common transit ticket system for both the closed system of NLEX and that of SCTEX, a single official receipt is now issued to expressway users. The receipt through still provides a breakdown of the NLEX and SCTEX toll charge portions. Electronic payment option Easytrip, previously available in NLEX, can now also be used in SCTEX.

Due to the integration and faster queues at the toll plazas, travel time was cut down by as much as 40 minutes. More importantly, the integration ultimately benefits commerce as a more expedient delivery of goods and services is made possible through the seamless flow of traffic in the northern expressways.

NLEX Corp. is also improving the full 94-km stretch of the SCTEX. This is to bring it to the same international quality of the NLEX. Asphalt overlay and road patching began in 2016. This is part of a three-year, ₱1 billion pavement improvement project. It is initially focused on rehabilitating the stretch of the road from Porac, Pampanga to Concepcion, Tarlac. As of year-end 2016, 39 out of 122 lane kilometers have been paved at the mainline, while 16 out of 61 lane kilometers have been paved at the outer shoulder of the expressway.

While NLEX is already of best in class quality, upgrades are set to continue. A ₱2.6 billion road-widening project covering Segments 2 and 3 of the expressway is underway. This will provide better free flow among the growing number of vehicles plying the tollway. Begun in March 2016, the project will expand the existing

two-lane portion of NLEX between Sta. Rita and San Fernando to three lanes on both the northbound and southbound sides. The current one-lane stretch between Dau and Sta. Ines will also be expanded to two lanes on both sides.

In other parts of the NLEX, a heavy maintenance program, which was also began in 2016, is halfway to completion as of year-end 2016. This ₱113 Million project involves road patching of north bound and south bound portions of the expressway from Valenzuela to Sta. Ines.

Also progressing is the expansion of the NLEX Bocaue Toll Barrier from 25 toll lanes to 33 toll lanes. Costing an estimated ₱200 Million, this expansion will substantially enhance the mobility of motorists passing through the Bocaue southbound toll plaza.

Rehabilitation or replacement of the equipment in toll booths in all SCTEX plazas is also in order. Once completed, this will enrich customer experience. The NLEX Corp has also allotted is ₱47 Million of capital expenditure for system and software, traffic devices, and facility improvements.

Meanwhile, CAVITEX has begun the strategic conversion of cash lanes to RFID lanes. CAVITEX has earlier launched the EASYDRIVE RFID (Radio Frequency Identification) for Class 1, 2 and 3 vehicles and is now pushing for its wider use among motorists. A free RFID promo was launched in early 2017 to induce RFID use and lane trial by motorists who were largely used to paying cash. The promo was successful as the company noted a substantial increase in cashless transactions, which served to improve lane efficiency and capacity and decreased queueing time during morning and evening peak hours.


89.9%OVErAll

SATISfACTION

Nov 2015 - Jan 2016

90.3%OVErAll

SATISfACTION

feb - Apr 2016

90.6%OVErAll

SATISfACTION

May - July 2016

90.6%OVErAll

SATISfACTION

Aug - Oct 2016

SERvICE ExCELLEnCE

NLEX Corp conducts a customer satisfaction survey during the last 10 days of every month throughout NLEX-SCTEX. Face-to-face interviews were conducted by a third party guided by a structured questionnaire. Respondents range from private motorists to light public utility motorists to bus drivers, truck drivers, and business operators.

To ensure accessibility to its customers, NLEX maintains Customer Service Centers strategically located along the expressway. These centers attend to walk-in customer inquiries, complaints and purchase of NLEX products. NLEX also maintains a 24-hour hotline service which responds to customer concerns. Concerns may also be raised via its social media accounts on Twitter and Facebook.

CIC, on the other hand, follows a different process to monitor and capture customer experience and handle performance. On a quarterly basis, internal audits are conducted and these include:

• Quality Assurance. In-house audit and inspection directed to the appropriate reporting of procedural and behavioral deviations.

• External Audit. Conduct of situational audits inclusive of lane processing improvement, customer satisfaction, and contract compliance.

• Revenue Assurance. Toll audit of compliance to SOP including cash handling, revenue, exceptional transactions, and/or procedural deviations.

Similar to the NLEX, Customer Service Centers are situated along Cavitex. Located at the south bound and north bound of the Parañaque toll plaza. A one-stop-shop where motorists may walk in to inquire, file their comments, feedback and concerns, transact payments and other fees, purchase and reload the EASYDRIVE RFID. A customer service is always present to attend to the needs of any motorists who visits.

The more common interactions are done through frontliners such as toll tellers, patrol crew, and security guards who are trained to initially attend to motorist inquiries and concerns within their scope. Motorists may also contact the customer service hotline 165-8888 or communicate via the Cavitex Facebook and Twitter which are jointly attended to by the Customer Service Department, Traffic Control Room Personnel, and the Communications and Stakeholder Management teams.

Great CAVITEX customer experiences are captured through its Online Customer Concern Management System (OCCMS). This is where CIC Customer Service receives and inputs various customer feedback. All registered complaints receive an acknowledgement from the concerned

The average overall satisfaction rating obtained through these surveys for the period of November 2015 to October 2016 was at 90.35 out of 100. The surveys will resume in January 2017.

G4-PR5

89Toll Roads

department within 24 hours of system encoding. Resolution turnaround time is normally achieved within five calendar days. For specific concerns to its RFID brand EASYDRIVE, motorists are referred to Easytrip Hotline 555-75-75.

In addition to these initiatives to monitor customer experience, NLEX-SCTEX and CAVITEX also maintain an annual Heavy Maintenance Program. The expressways undergo repairs like crack mapping and sealing, pothole patching, milling and overlay, among others. The program is geared towards optimizing ideal road conditions to extend service life of the roadway asset.

Road safety is another concern the company focuses on. For instance, TMC has published an affordable New North Luzon Expressway Motorist’s Handbook as a guidance manual to ensure a safe and convenient travel experience on the NLEX. The guidebook includes general tips for driving in the NLEX, handling emergencies, understanding road signs and signals, observing traffic rules and regulations, and a linear map for motorists traversing the Balintawak Toll Barrier up to the Sta. Ines interchange. Emergency hotline numbers were also clearly indicated at the end portion of the handbook.

What’s more, TMC has a 24/7 Traffic Management and Safety Department which is committed to

respond in a rapid and efficient manner to any disturbance or emergency situation within the NLEX and SCTEX. The expected response rate is 20 minutes on average for all calls received or routed to the Traffic Control Room.

Patrol crews are trained and authorized to conduct road accident investigations with the option to further endorse cases to the Philippine National Police. Road safety remains the primary objective of the Patrol Crew. Even as they assist road users, they may order the immediate clearing of debris and vehicles that may be impeding the smooth flow of traffic or posing as a danger to motorists.

An Emergency Medical Service (EMS) provider is also on stand-by 24/7 in case crucial first-aid, emergency life-line support and/or pre-hospital care are needed. The paramedic response unit is competent in the application of invasive maneuver appropriate to emergency care. The EMS team is linked to a network of medical aid specialists who have extraction and air transport capability for accident victims.

Advanced Life Support (ALS)-equipped ambulances are available should a situation arise where a road user is severely injured or whenever critical care may be necessary. Emergency medical protocols are followed with due consideration given to pertinent circumstances unique to every situation.


Partnered with the ALS Ambulance is an extrication/recovery vehicle. Response time is the same as the Patrol Crew, averaging 20 minutes from receipt of call by the Traffic Control room (TCR).

Meanwhile, NLEX and SCTEX outsourced security personnel are on circuit duty 24/7. They ensure regular roving inspections and remain in communication by means of handheld radios for timely and efficient communications. Logbook records are strictly maintained for monitoring purposes. Further, the NLEX and SCTEX are both equipped with CCTV System with monitoring cameras strategically installed throughout its buildings and carriageways. The monitoring of the CCTV System is handled by the TCR.

Similarly, CAVITEX, has contractual arrangements with a third party security service provider and Emergency Medical Services provides who have personnel on standby 24/7. Ready for deployment at a moment’s notice, there is an appropriate ratio of active duty security guards to relievers. All traffic incidents within the corridor of CAVITEX are reported to the TCR. Reports are made by responding Patrol Officers, Traffic Marshalls, Roadway Security, or by concerned motorists.

As practiced in the NLEX and SCTEX, Patrol and Traffic Accident Investigators (TAI) are also on duty 24/7. They are immediately dispatched as soon as the TCR receives an accident report or detects an incident through the CCTV. The TCR then makes an assessment of the nature of the traffic and deploys a response unit according to the situation. Incident response units are comprised of EMS (Aeromed), Emergency Roadside Towing Services (ERTS), Incident Response, and Traffic and Security Operations personnel.

Most incidents are categorized as either a vehicular breakdown or a vehicular crash.

Upon arrival at the accident site, the TAIs immediately request the necessary assistance from concerned units, prioritizing injured motorists. Saving lives takes precedence over an investigation.

An investigation on damage to property follows. Traffic violators are issued a citation by a TAI as they are deputized to do so by the Land Transportation Office (LTO). Coordination with appropriate local traffic management units is made by a TAI for accidents resulting in injury or fatality. CAVITEX traffic accident reports become part of any ensuing investigation by the Philippine National Police (PNP).

Meanwhile, damage to CAVITEX property are inspected and evaluated by Facilities Maintenance while payment collection from concerned parties is handled by the Finance department.

In pursuit of always improving safety and security for motorists, CIC will be undertaking installation of advanced analytical CCTV cameras within CAVITEX and has recently acquired digital radios with GPS capabilities. Response time to traffic incidents is expected to improve with the added adoption of these innovations.

With their dedicated and committed focus on safety and security, both NLEX Corp. and CIC regularly receive personnel commendations for its response and rescue services, many of which are received through social media. Motorists express their gratitude for NLEX Corp. and CIC staff who provided them unconditional help, rapid response, mechanical knowledge, courtesy, and bribery-free aid.

12 minutes Patrol Assistance Average Response Time

15 minutes Medical Service Average Response Time

12 minutes Traffic Incident Average Response Time

NLEX Corp CIC

91Toll Roads

Social Media is where consumers are able to freely express their unfiltered sentiments and opinions about the different services they receive from various companies and agencies. Social media is where the average motorist is able to express their genuine feelings toward their experience on the road.

It is notable, therefore, how the Cavitex Highway Patrol officers have shown that through professional and wholehearted public service, the motoring public that they serve will benefit greatly and appreciate it deeply.

Throughout the year, Cavitex has been receiving Social Media shout outs for officers who have delighted people who have been helped in their time of distress, such as those who suffered vehicle breakdowns and flat tires. The fast and expert response of the officers to situations on the road made them feel safe and in good hands.

“This is to express my sincere appreciation to your kind and honest Patrol and Towing Officers for their dedication and immediate response to help, without asking for anything in return, defying the stereotype practices among men in uniform. I salute all the personnel and patrol officers of Cavitex. More power and may God bless you more!” wrote one motorist as he commended Patrol Officer Pangilinan.

Among those who have received public commendations from the people they have assisted were PO Calanno, PO Jaramilla, PO Abad Reyes, PO Batuigas, PO Gantan, PO Baria, PO Azarcon, PO Mahayag, PO Comala, PO Lim, PO Pangilinan, PO Garcia, PO Plan, PO Julianda, and TCR Specialist Bula.

The commendations all highlighted the fact that the officers refused any monetary rewards and insisted that they are simply happy to do their duty and help out whenever needed. The Social Media posts also expressed hope that others would emulate the good example set by the officers of Cavitex.

Restoring faith through public service CAVITEX



MNTC

The Toll Roads group employs a combined staff of 1,346 people, most of whom are with TMC (1,120). The ratio of male to female employees is nearly equal. More than half of its employee base belongs to the 30-50 age group. NLEX Corp. employs more employees than that of CIC as the stretch of the expressway it manages and operates is significantly longer.

Male

Female 30 to 50

Under 30

Over 50rank and File

Middle Managemement

Supervisors

senior Management

43

70 19

55

113

53 20

114

72

Employment by Gender

121

60

3

2

regular

Probationary

Contractual

Project-based

TOTAL: 186

Employment by status

Employment by rank Employment by Age range

G4-10

93Toll Roads


Employment by statusTMC

regular

Probationary

Contractual

TOTAL: 1120

930

167

23

Male

Female 30 to 50

Under 30

Over 50rank and File

Supervisors

Middle Managemement

senior Management

Employment by Gender Employment by rank Employment by Age range

557

563 1,004

77

336

650

454

16


NLEX Corp. and CIC prepare and train all personnel for hazards and risks inherent to operations. Service providers and staff are given safety orientations and are provided personal protective equipment (PPE). Safety inspections are made on a regular basis for the proactive prevention of accidents. Should a safety incident occur, accident reports and investigations are thoroughly conducted to prevent recurrence.

Additionally, fire and earthquake drills are conducted during the course of the year. Fire drills are held on a bi-annual basis and include an orientation on the proper use of fire extinguishers to ensure proper fire response at all times. Occasionally, bush fires occur along

the expressways which can bring road visibility down to zero. At such times, alert, knowledgeable and rapid response by toll personnel is an important factor to avoid accidents and keep motorists safe. Training on bomb threat scenarios are also regularly covered during the drills.

Beyond safety, the well-being of the staff is likewise valued. Employees are given annual physical exams and CIC and NLEX Corp. extend regular access to a gym within office premises to promote wellness. At least once a year, Blood Letting Programs are held and employees are encouraged to volunteer. Annual Sportsfests are also held and are usually conducted together with residents of neighboring communities.

Male

Female

20

20


rank and File

Supervisors

Middle Managemement

senior Management

24

8

7

1Employment by rank

30 to 50

Under 30

Over 50

16 6

18


regular

Project-based

8

32

TOTAL: 40

CICEmployment by status

95Toll Roads


MPTC believes infrastructure development leads to social progress, progress that is further supported with responsible corporate citizenship. At the core of its CSR principles is “Doing Well” or the delivery of excellent service, getting fair return so that the company can continue doing excellent service. The other part is “Doing Good” which is the undertaking of programs that support the company’s core business and promote people’s welfare and wellbeing.

NLEX Corp. therefore acts on this belief and does its part as a responsible corporate citizen by working with and engaging host communities and helping make a real difference in their lives.

For one, there is Usapang Driver — a drivers’ education program specific to drivers plying the NLEX. It is an interactive forum where drivers of bus, trucks and jeepneys learn about safe driving practices along the expressway — causes and prevention of accidents, safety features of NLEX, rules and regulations, relevant legislations implemented in NLEX, and other information pertinent to the use of the NLEX.

Usapang Driver is also a venue for constructive dialogue between the public transport sector and the NLEX concessionaire (MNTC) and operator (TMC) where concerns and issues are aired, clarified and addressed. The company’s Customer Satisfaction Task Force also uses Usapang Driver as a medium to directly communicate and address sources of low satisfaction as revealed in the Customer Satisfaction surveys.

Companies who are given Usapang Driver seminars are sourced by MNTC through interaction and courtesy calls with top bus and truck companies. TMC, meanwhile, suggests participants from a list of top traffic violators. Fleet drivers are given the program in a classroom set-up, and the seminar is moderated by TMC representatives.

G4-SO1


Another significant project was the NLEXcellence Safety Awards which aimed to give due recognition to bus and trucking companies that excel and strictly adhere to road safety standards consistent with the NLEX principles of customers’ safety and protection at all times.

The NLEXcellence Safety Awards consist of three categories: Vehicle Quality, Driver’s Professionalism, and Company Operational Excellence.

Nominations are open to any bus company or trucking firm with at least 20 vehicles, at least 50 percent of its trips coming to and from North Philippines, and 30 percent of these trips are taken on the NLEX.

It is a way of recognizing NLEX users who share the company’s dedication and commitment to safety.

Being given this award heralds the awardees as role models for other companies to emulate for their best practices in company operations and road safety.

All activities pertaining to the awards are spearheaded by MNTC Marketing -Toll Comm Section. After nomination, a third-party research agency conducts a site audit at the nominees’ garages and offices to verify statements and claims declared in the nomination form. Nominations are shortlisted based on the quantitative and qualitative criteria, before a final selection is made for each award category. Awardees are then feted in a prestigious awards ceremony where their best practices are featured. A post-event campaign then follows to inform the general motorists and public of the NLEXcellence Safety Awardees.

2016 also saw the birth of the NLEX Leaders’ Forum — an interactive meeting of leaders and important players within the transport industry. It is an exclusive opportunity for trucking companies who put value in learning and company development to have a productive interaction with the movers and shakers from both public and private sectors. An opportunity

for personal interaction with business leaders in the transportation industry, the forum is a half-day event that addresses the major forces driving trucking industry: emerging technologies, evolving consumers, economy and finance and more.

The NLEX Leaders’ Forum aims to provide a dialogue and discussion that will:

• Inform, challenge and inspire on leadership, business excellence, and related government/ public policy

• Explore trends, issues, and ideas shaping the economy

• Build relationships, partnerships, and develop a sense of belongingness by sharing a common experience

Another safety initiative is the Gusto Ko, Ligtas Tayo (GKLT) program, a road safety education program designed to increase awareness on good road safety practices in host barangays and schools. In 2016, total attendees numbered 1,758, with participants coming from 14 elementary schools and 9 barangays.

Meanwhile, CIC also has its Transportation organizations Promoting Advocacies on Road Safety Guild or Tropang CAVITEX, which is a dedicated group of CIC employees fully committed to a safety campaign. Lectures on safe expressway driving are given to drivers of buses, trucks, PUJs and services. Emergency preparedness, personal and community safety count among other topics covered.

For 2016, MNTC launched two new CSR programs namely: “Tullahan River NLEX Junior Patrol” and “NLEX-SCTEX Ganda Mo, Hanap Buhay Ko.”

The company began the initiatives for the river clean-up in 2010 with its “Tullahan River: Cleaning it up, Keeping it Clean” CSR program. The 1.5-kilometer-stretch of the Tullahan River is important as it spans three barangays:

97Toll Roads

Barangay Talipapa in Quezon City, Barangay Ugong in Valenzuela City and Barangay 164 in Caloocan City. To sustain the cleanup program, the company launched the NLEX Junior Patrol.

The program aims to educate children on the importance of protecting and preserving the environment, specially the the river. Its goal is to train children aged 11-12 of the three Tullahan communities to be the watchers of Tullahan River. A total of 67 children completed the two-day workshop and were vested as official NLEX Junior Patrol.

Another CSR program is the skills training and livelihood program launched in October 2016. The program called “NLEX-SCTEX Ganda Mo, Hanap Buhay Ko” is a basic cosmetology training program in partnership with the Ang-Hortaleza Foundation. This program aims to provide skills training that will supplement the household income of residents of NLEX-SCTEX communities.

The program was pilot-tested to selected unemployed women in Segment 10 communities (Barangay 26, 29 and 63 in Caloocan City) who will be relocated to Pandi, Bulacan to provide an alternative livelihood opportunity. Twenty-five residents have benefited from the program. Success stories were heard during the “Kamustahan” session, held after two months of their training. Eighty percent of the participants were able to apply the skills they have learned and already earn additional income to help out their family. The Kamustahan is also the final evaluation of Ang Hortaleza if they will grant another training session to their partners.

Meanwhile, CIC’s CSR programs includes a host of projects geared towards environmental management. CAVITEX is among those facing the challenges and hazards of environmental calamities such as storm surges, being an expressway running through a coastal area.

Projects include support for the Las Piñas-Parañaque Critical Habitat and Ecotourism Area (LPPCHEA) that is situated along the Las Piñas-Parañaque carriageway which CAVITEX traverses. LPPCHEA is the last natural mangrove area south of Metro Manila. It is home and feeding ground for countless migratory bird species from Russia and China. LPPCHEA reached a critical point after long being a dump site for garbage and solid wastes, which caused oxygen deprivation and placing dependent flora and fauna at risk.

CIC initiated Living in an Environment of Aqua Flora and Fauna (LEAF) in support of LPPCHEA. LEAF is a holistic program established for hazard prevention, pollution control, and habitat protection. It is also CIC’s response to the National Greening Program. Under LEAF, endemic mangrove species are propagated, planted, and grown along the embankments of CAVITEX and in surrounding coastal waters. Growth of planted mangroves is recorded and monitored by DENR. Flora are geo-tagged so that volunteer planters/growers can do their own monitoring through Google Maps.

CIC’s Care for the Restoration of Environment (CARE) is the implementing vehicle of its CSR activities. At its core is employee volunteerism. Activities include, but are not limited to, relief operations for disaster victims (particularly flood and fire), medical missions to host communities, tree-planting initiatives, coastal clean-ups with partners, and participation in local and international environmental groups such as LPPCHEA, Alliance for Stewardship and Authentic Progress, Save Freedom Island movement, Ocean Diversity International, and Earth Day International.


LIGHT RAIL CORPORATIOn (LRMC)Light Rail Manila Corporation (LRMC) is a joint venture company of MPIC’s Metro Pacific Light Rail Corporation (MPLRC), Ayala Corporation’s AC Infrastructure Holdings Corporation (AC Infra), and the Philippine Investment Alliance for Infrastructure’s Macquarie Infrastructure Holdings (Philippines) PTE Ltd. (MIHPL). MPIC holds a 55% effective ownership of LRMC as of end December 2016.

LRMC was incorporated in 2014 with the business purpose of financing, constructing, operating and maintaining the Light Rail Transit (LRT) Line 1 Cavite Extension and Operation and maintainance project. LRMC has taken on the operations and maintenance of the Existing System of LRT-1. After winning the project via the lone bid with a bid premium of ₱9.35 billion. This covers the original 18 passenger stations from Baclaran to Monumento and the North Line Extension (NLE) which has passenger stations at Balintawak and Roosevelt.

On October 2014, LRMC signed the Concession Agreement with the Department of Transportation and Communications (DOTC) and the Light Rail Transit Authority (LRTA) that included a ₱65 billion LRT-1 Cavite Extension, Operation and Maintenance Project which is part of the 2011-2016 Philippine Development Plan to accelerate infrastructure. Under its Concession Agreement, the service obligations of LRMC include:

• Improving the efficiency, safety and overall riding experience of the Filipino public.

• Expanding the capacity of the trains to lessen waiting time.

• Improve the safety of the riding public.

• Extending the track by 11 kilometers from Baclaran to Niog, Bacoor, Cavite to increase the reach of this particular mode of transportation to a greater number of people south side of Manila.

• Rehabilitating all the stations to improve the overall light rail experience.

It will extend the present system from the Baclaran Station to the Niog area in Bacoor, Cavite. This new route will comprise eight stations—Redemptorist, MIA, Asia World, Ninoy Aquino, Dr. Santos, Las Piñas, Zapote, and Niog. These additional stations are envisioned to help ease the worsening traffic conditions in the Parañaque-Las Piñas-Cavite corridor. The Cavite Extension Works will begin within 2017. The extended rail line is expected to help increase the capacity of LRT-1 from 500,000 to 800,000 passengers daily and benefit more than four Million residents in the southern part of Metro Manila and of Cavite. The projected commercial development around the rail stations is expected to benefit surrounding communities as well.

LRMC is in the process of refurbishing existing trains and purchasing new ones for the comfort of passengers and to increase capacity. Replacement of the entire track system is being done in strategic phases.

The company’s project investment is set at ₱35 billion. Financing is mainly through a 15-year ₱24 billion Omnibus Loan and Security Agreement (OLSA) with local banks SB Capital Investment

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Corporation, First Metro Investment Corporation, and RCBC Capital Corporation which will fund the LRT-1 Cavite extension project and the rehabilitation of the existing LRT-1 system.

Since assuming operations and maintenance of the 20-kilometer existing rail system from Roosevelt Station in Quezon City to Baclaran

Station in Parañaque City in September 2015, monthly ridership has increased from 11.7 Million in August 2015 to 12.3 Million in December 2016.Passenger capacity of LRT-1 also increased from 13,500 to 17,000 per hour per direction (northbound/southbound) over the same period, following the increase of light rail vehicles (LRVs) from 77 in September 2015 to 100 in December 2016.



2015 2016 Total ridership

141.3 Million147.7 Million

Average Daily Ridership

409,785429,000

Train Cycle Time

118 mins100 mins

Train Queuing Time

6 mins4 mins

Electrical Consumption (MWh) Electricity Intensity

Water Consumption

recyclable waste

46,900 m3

GHG Emissions

25,010 tCO2e

Biodegradable waste

7,311 kg

Non-biodegradable waste

16,407 kg

7,935 kg

hazardous waste

16,254 kg

Operating light rail Vehicles

77

100

Total Employees

1,267

1,469

42105 258 kwh pertrain trip

G4-EN3, G4-EN5, G4-EN8, G4-EN16, G4-EN23

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The work towards the goal of raising the LRT-1 to world-class standards began immediately when LMRC took the helm. The Company is committed to deliver a safe, reliable, and world-class rail system at par with the better commuter railway hubs in Asia.

Initial enhancements to the train line have included the replacement of rails, the restoration of elevators and escalators, and the refurbishment of the 20 existing stations.

As of yearend 2016, the number of running light rail vehicles (LRVs) has increased to 100, reflecting an additional 23 light rail vehicles (LRVs) rehabilitated and functioning since LRMC's assumption of operations and maintenance in September of 2015.

The hard work of LRMC’s engineering team has also given rise to an increased passenger capacity, serving a daily average of 420,000 passengers. LRT-1 is able to deploy up to 30 trains daily. Cycle time (time for a train to complete a loop) improved from 118 minutes to 108 minutes, effecting a decrease in average passenger queueing — from 6 minutes down to 4 minutes.

Meanwhile, in the Railway Enhancements Phase 1, the replacement of LRT-1’s 32-year-old rails is also underway, with a total of 10,583 meters or 40% completed as of year-end. The rail replacement project runs a total of 26 kilometers from Baclaran to 5th Avenue stations, and is targeted to finish by the end of 2017. As to the southbound tracks, 23 kilometers have been replaced as of December of 2015. This is in addition to eight kilometers replaced prior to LRMC’s assumption of operations.

Once complete, the new tracks are expected to allow trains to increase their speed from the current 40 kph to 60 kph. They will also

decrease the wear and tear of LRVs and improve the reliability of the whole system. Quality rails and optimum speed will result to an increase in the life span of LRT-1 trains. Residents of communities near the station will experience the added benefit of significant reduction in the vibration and noise levels previously experienced.

LRMC has engaged four of the world’s best in rail development to share their professional expertise as the company’s global partners.

RATP (Régie Autonome des Transports Parisiens, on: Autonomous Operator of Parisian Transports) serves as Technical Advisors for managing/operating the existing LRT-1 Train Operations and Engineering. RATP is dedicated to the operation and maintenance of all modes of urban transport and operates the world’s largest metro, bus, suburban, heavy-rail and light-rail integrated public transport network in France (Ile-de-France).

Bouygues Travaux Publics is the Technical Advisors with focus on infrastructure construction for the Cavite Extension Works project. The company is a world-renowned civil and railway construction company, headquartered in France. Bouygues specializes in underground works, complex civil engineering projects and engineering structures, as well as road, public transport and port infrastructures.

Alstom is the Technical Advisors for the on rail-related equipment and signaling systems of the LRT-1 Cavite Extension. Alstom is a world-class rail solutions supplier that develops and markets a complete range of systems, equipment and service for the railway industry.

Systra, a French structural consulting group, is designing the Cavite Extension Works.


LRMC will pursue ISO:9001-2015 (Quality Management System) and ISO 14001:2015 (Environmental Management Systems) accreditations in 2017. LRMC’s procurement process helps the company maintain continuous operations, safeguard structural integrity of its facilities and ensure that passengers benefit from a reliable, convenient and secure journey.

All potential vendors go through an accreditation process that involves an ocular inspection by project proponents and the Health, Safety, Environment, and Quality (HSEQ), a financial stability study care of LRMC Finance, a thorough review of relevant and current permits and licenses, and undertaking regulatory accreditation as required.

105Rail

• Initiation• Scoping• Design Review

• Vendor Selection• Tendering

• Execution• Monitoring and Audit

• Project Completion

• Post Job Evaluation

risk Assessment

Compliance to regulatory requirements

HSEQ requirements in Contracts

HSEQ Criteria in prequalification

Method statement Review

Job hazard Analysis

Orientation

Permit to work

lessons learned

Continuous Improvement

recognition

Contractor HSEQ Management ProcedureAccredited vendors must meet a host of criteria with which they will be regularly evaluated against: Quality and Safety, Timeliness, Total Acquisition Cost, and Customer Service Satisfaction. Regular appraisal of Vendor of Goods and Services involve manual evaluations and there is an assessment of every Project Completion (or per progress billing). Violations are recorded and marked on a Vendor’s evaluation form and protocol directs four violation stages—verbal notification, notice of violation, notice of suspension, and banning.

All contractors are required to complete a Safety Orientation conducted by LRMC HSEQ. They should be current and compliant in their Work Permit/Clearances Applications, including a Job Hazard Analysis Submission.

HSEQ developed the Contractor HSEQ Management Procedure to establish a proactive and systematic approach to manage and control risks arising from work performed by contractors in LRMC. Work standards are obligated to meet HSEQ standards. Oversight is by a cross-functional team composed of LRMC Contractor Sponsors (e.g. Project Managers), Procurement, HSEQ, Engineering, and Legal. Major works undertaken by contractors include the main line rail replacement and station and depot improvements.


SERvICE ExCELLEnCE

Light Rail Transit Line 1 (LRT-1) used to be known for poorly maintained trains, long queues and negative customer experience as reflected in the negative media coverage and social media impressions. But, in less than two years since assuming management of LRT-1, LRMC was able to improve efficiencies and introduce innovations that resulted in increased number of trains and trips, reduced passenger waiting time, improved safety and cleanliness of the stations, increased

ridership, extended operating hours, increased customer satisfaction and the achievement of ISO certifications for quality management and environmental management, all unprecedented milestones in the 32-year history of Manila’s oldest light rail system.

The achievements of the LRMC management team bodes well for the Philippine Government's program to accelerate infrastructure and

107Rail

contribute to inclusive growth and poverty reduction in Metro Manila. The synergy of these parties demonstrate that the public and the private sectors can work together to provide the public with safe, e client, reliable and comfortable services.

A major program that LRMC has undertaken to addressed the challenges of an aging railway system was the systematic replacements of rails and other rail components to keep the LRT-1functioning at optimum quality and enable trains peed to be increased from 40kph to 60kph. This will also result in increased life span of LRT-1 as the rail replacement is expected to minimize wear and tear for the rolling stock and increase the reliability of the whole train system. The project will also benefit communities in close proximity to the stations as the new set of tracks will significantly reduce the vibration and noise levels along the vicinity of the line. The project was completed in August 2017, with commissioning timetabled in Q42017 and increase of speed to 60kph by Q1 2018

Following the replacement of the rails, LRMC also embarked on the P1-billion project to repair the structural defects caused by wear and tear on the parapets and the guideways over the last 32 years.

To increase passenger capacity, LRMC invested in the P1-billion rehabilitation of light rail vehicles (LRVs) which included the refurbishment of interior walls, floors and seats, exterior car body repairs, and finding the original equipment manufacturers in Europe for the replacement of obsolete spare parts. From 77 LRVs in September 2015, LRT-1 has 100 LRVs by end of 2016 and the number is expected to increase by end-2017.

LRMC likewise introduced innovations and improvements in track management. When it assumed operations in September 2015, average cycle time was at 118 minutes. By initially increasing the speed at the LRT-1 north extension(Roosevelt, Balintawak and Monumento) and deploying sliders to reduce reversing time in Baclaran and Roosevelt, average cycle time was reduced to 100 minutes.

The improved cycle time and the increase in LRV’s has allowed LRMC to improve the timetable and increase the number of trips. Average number of daily trips has now increased from 498 to 554trips on weekdays and from 443 to 472 trips on Saturdays.

The innovation of the new timetable has decreased passenger queueing time and headways in between trains from 5-6 minutes in 2016 to less than 3.5 minutes this year.

LRMC has also extended the train service to accommodate early and late night commuters. First trip is now earlier at 4:30 a.m. from the previous 5:00 a.m. Five trips were also added to extend the last trip from 9:30 p.m. to 10:15 p.m.

According to a customer satisfaction survey commissioned by the Light Rail Transit Authority (LRTA) in December 2016, customer ratings for LRT-1 are significantly higher than the previous year. For overall weighted satisfaction on a scale of 1-7 points, customers’ rating of LRT-1 increased from 4.86 points to 5.63 points.


International recognition

In 2016, LRMC has been recognized for its commitment to accelerate improvement in Manila's railway systems, foremost of which is the operation and management of LRT-1 and the construction of the LRT-1 Cavite Extension. While prioritizing this commitment to the Philippine Government and the LRT-1 customers, it has also been acclaimed for its programs to enhance passenger safety as well as environmental protection and community engagement:

• 2016 Best Project Finance Deal | 10th Alpha Southeast Asia Awards (Malaysia)

• 2016 Asia Pacific Infrastructure Deal of the Year | Project Finance International Awards (United Kingdom)

• 2016 Asia Pacific Rail | IJ Global Awards (Singapore)

• Transport Deal of the Year | The Asset Asian Awards (Hong Kong)

• Gold Anvil and Silver Anvil Awards for Passenger Safety Education | 52nd Anvil Awards

• Silver Anvil Award for Corporate Social Responsibility | 52nd Anvil Awards

109Rail

Pioneering Achievements

More upgrades and comfortable journeys LRMC has increased the number of light rail vehicles (LRVs) from 77 in September 2015 to 100 as of December 2016. Replacement of the LRT-1’s 32-year old rails started in August 2016 and will be completed in September 2017 resulting to safer, smoother rides and enable trains to increase speed from the current 40kph to 60kph from Baclaran to Monumento Stations.

More efficient train and traffic management system IMPROVED CYCLE TIME: Cycle time is the time it takes for one train to complete one loop. LRMC reduced the cycle time from an average of 118 to 100 minutes by increasing the speed from Roosevelt to Monumento. Further, LRMC also deployed train sliders to reduce turnback times and increase efficiency of traffic management.

• REDUCED QUEUEING TIME: More efficient deployment of trains has significantly reduced passenger queueing time and headways in between trains from 5-6 minutes to less than four minutes.

• MORE TRIPS: In June 2017, LRMC implemented a new timetable which increased the number of trips from the current 512 to 554 trips on weekdays and from 443 to 472 on Saturdays.

Extended revenue hours LRMC has opened all 20 passenger stations at 4:00 a.m., with train service starting 4:30 a.m.at Baclaran and Roosevelt Stations. Five trips were also added to accommodate late night commuters; from the previous last trip timetable of 9:30pm, northbound trains now leave Baclaran Terminal at 9:40 p.m., 9:50 p.m. and 10:00 p.m. and southbound trains leaving Roosevelt Terminal at 10:10 p.m. and 10:15 p.m.

ISO certification 9001:2015 and 14001:2015 The ISO audit process required LRMC to document its quality and environmental policies, procedures and other documentation required to meet its quality and environmental objectives, targets and programs. The certification body, TUV Rheinland, then conducted a Pre-Assessment Audit as an initial step followed by Stage 1 and Stage 2 Audits which involved going through selected documentation and on a sampling basis, check if the actual execution of the procedures or work instructions involved comply with what is written in the documentation being audited. Challenges we had to overcome included completing the documentation of the mandatory policies, procedures and forms to be covered by the certification audit, training the various personnel in performing their work according to these documents and equally important, rallying the critical mass of employees to confidently prepare for the certification process. The whole process of preparation was led from the very top by no less than the President/CEO and the Management Committee, which sent a clear message to all employees that ISO certification was an important strategic milestone for LRMC, not just a compliance with one of the Concession Agreement obligations. Consequently, the audit findings included a recognition on LRMC’s top management team that says, “Leadership and commitment to the effective implementation of the management system are well demonstrated.”



In 2016, LRMC undertook “Project Arangkada” which is a project aimed at attracting and recruiting the right people for the company’s needs. Through “Project Arangkada”, the company successfully hired 105 station tellers, 25 station supervisors, and 30 train drivers in total.

senior Management

Female

Male

Middle Management rank and File

21

45

454917

7

25

Female

Male

Female

Male

13

19

8

20

38

275 184

913

30 to 50

Under 30

Over 50

senior Management Middle Management rank and File

30 to 50

Under 30

Over 50

30 to 50

Under 30

Over 50

As part of the hiring process, new hires go through aptitude tests and training on their technical competence and skills. For instance, driver hires are required to complete a specialized training course on technical and practical aspects of their work — including safety communications, incident/accident management, fault reporting, basic train driving and intervention, and hauling procedures.

The company is embedding health and safety initiatives and guidelines in all training and development opportunities given to its employees, espousing smarter choices that lead to improved health, security and productivity. LRMC emphasizes personal accountability and encourages employees to undergo lifestyle changes that will have long-term positive impact on their lives.

HSEQ conducted an employee survey that generated responses from 551 employees or around 40% of the total employee population. 79% of the respondents gave positive marks for LMRC as a workplace that engender self-worth among employees and as an organization that evoke a sense of belonging. The most positive

Average Training Hour

Middle Management

senior Management

rank and File

0.39 0.57

0.61

Employment by Age Group


111Rail

response came from 84% who felt that their supervisors “cared for them as a person”.

The survey also revealed opportunities for improvement in terms of increasing safety conversations and practice along with availability of PPE and materials needed to work safely. The Management Committee reviewed the results of the survey and several action points were agreed to be taken in response, including: providing shuttle services for Shifts 1 and 3 employees going to and from work during early morning and late evening hours, assigning employees to stations near their homes, conducting semi-annual safety refreshers for all employees, and for all HODs to start their meetings with a safety moment.

As an additional communication tool, the company publishes its LRMC for L.I.F.E (Living in an Incident-Free Environment) which is a monthly newsletter initiative by LRMC’s Health, Safety, Environment and Quality (HSEQ)

Department. It shares with all LRMC employees the accomplishments and ongoing projects to address various issues on employees’ and customers’ health and safety. It also includes articles on the forward direction of the company, fostering a safety mindset and work safety culture and recognition of safety stewards in LRMC.

In terms of training, the company conducted several that focused on strengthening the safety culture in the workplace. The Fire Safety Enforcement agency of the Bureau of Fire Protection conducted a Fire Safety Practitioners Competency Training attended by 31 employees representing 6 departments. Participants were familiarized with RA 9514 or the Revised Fire Code of the Philippines and its implementing rules and regulations in line with LRMC’s on-going thrust to strengthen its fire prevention and response capabilities.



In September 2016, LRMC has launched a coalition to revitalize and rehabilitate Manila's longest creek, Estero de Tripa de Gallina (ETG). With ETG’s massive impact on the health, environment, and social aspects of residents living along it, it has become imperative to take action to restore life to the estero. Through community engagement backed by partnerships, research, and education drives, Light Rail Manila Corporation (LRMC) was able to execute a campaign called Live for the Rivers Movement Coalition that moved communities to infuse new life to Metro Manila’s longest creek.

The Program sought to achieve the following:

1. Seal a strategic alliance with local and national agencies to help LRMC enrich research and improve governance on the ETG system.

2. Determine the level of awareness, perception, and engagement of community stakeholders, particularly residents living in Pasay City’s Barangays 188, 189, and 190, on the importance of clean esteros to health, environment, and social aspects.

3. Engage the youth in the symposia, river cleanup proper and the sustaining activities supporting the program.

4. Secure the commitment of the community and government stakeholders to become stewards of sustainable care for ETG.

The program is directed at residents of Pasay City’s Barangay 188, 189, and 190. They were chosen as they were living along ETG, in the area also monitored by LRT 1 operator Light Rail Manila Corporation (LRMC).

LRMC targeted these communities as they are also the closest to the LRT-1 Depot located along Andrews Avenue in Pasay City. Barangays 188, 189, and 190 have a total population of 11,192, comprised of 2,020 households.

According to the Social Perception Survey conducted by LRMC, these people generally think that ETG is dirty due to people throwing their rubbish in its waters. A total of119 of the 139 people surveyed signified that they are willing to help clean ETG. However, no consolidated, centralized program is yet in place to enable them to do so. Given that they are willing to do their part to improve ETG’s current state, LRMC implemented this program to finally educate and move the communities to action.

The program also involved the youth, with LRMC tapping two academic institutions in the area: the City University of Pasay (CUP) and the Asian Institute of Maritime Studies (AIMS).

results

1. Partnership with local and national stakeholders — LRMC formed the Live for the Rivers Movement Coalition, a strategic partnership with local and national agencies tp empower the communities in ensuring the rehabilitation of the ETG.. These partners include the DENR, the City Government of Pasay, DOST, DILG, DOH, DPWH, MMDA, and the affected barangays (Barangays 188, 189, 190) and universities in the ETG vicinity (City University of Pasay and Asian Institute of Maritime Studies).

2. Social perception survey and Symposia — Through the social perception survey conducted by LRMC in the barangays, as well

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113Rail

as the symposia held in the communities and universities, LRMC was able to measure the level awareness of the residents on the state of ETG and their willingness to be part of clean up efforts. The research provided the baseline on which the Program, its tools and tactics, were designed.

3. Support and commitment of the partner communities and agencies to make the clean up sustainable — The volunteers who were all involved in the program have signified their commitment to work with LRMC to ensure that initial efforts for the clean up of ETG will be sustainable.

Through the MOA signing with the partner agencies, and the letter of intent submitted by the barangays, the River Guardians have all pledged to be stewards of the estero in their own ways.

HOSPITALS


HOSPITALS

Metro Pacific Hospital Holdings, Inc. (MPHHI) was established to invest and operate a portfolio of Healthcare assets. As of end 2016, MPIC's ownership in MPHHI's common shares was at 85.6%, with the remaining common share owned by GIC. In addition, GIC holds an exchangeable bond issued by MPIC which can be exchanged into a 25.5% stake in MPHHI in the future, subject to certain conditions.

MPIC ventured into the hospital business in 2007 with its investment in premier Makati Medical Center. The group, through MPHHI, has since then poured in about ₱12 billion of capital expenditures into the hospital industry, principally to expand and improve facilities and to purchase the latest medical equipment.

Over the past ten years, it has successfully built a very profitable chain through the acquisition of both underperforming and healthy hospitals, implementation of management efficiencies and the upgrade and expansion of facilities and equipment. MPPHI is now the largest private hospital network in the Philippines with over 2,900 beds from a total of 13 hospitals all over the country.

In addition to its network of hospitals, the Company has also invested in mall-based diagnostic and surgical Center Megaclinic in SM Megamall and formed a joint venture with Sanitas International in June 2016 to establish a nationwide network of primary care clinics. They are targeting to build and/or acquire approximately 30 clinics all over the country by 2021.

New hospital acquisitions in 2016 were Manila Doctors Hospital, Sacred Heart Hospital of Malolos Inc., and Marikina Valley Medical Center. MPHHI will continue investing in hospitals and expanding existing ones to achieve its 5,000-bed target in the next three to five years.

117Hospitals


MPHHI is also finalizing discussions with foreign technical strategic partners to establish a centralized laboratory which will be equipped to handle the requirements of its hospitals in Metro Manila.

Meanwhile, MPHHI is now studying the possibility of investing in the construction of new Greenfield hospitals, in addition to its original strategy of investing in existing hospitals, mainly because of the limited number of hospitals available for acquisition.

For the purposes of this Sustainability Report, we shall be sharing information on three of the larger hospitals, namely Asian Hospital and Medical Center (here presented as Asian Hospital Inc. or AHI), Makati Medical Center, and Cardinal Santos Medical Center.

Asian Hospital Incorporated (AHI)

Asian Hospital Incorporated is a tertiary hospital strategically located in Filinvest City in Alabang, Muntinlupa City—only 10 kilometers from the country’s central business district Makati City, a mere 20-minute drive from the International and Domestic airports, and less than a kilometer from the South Luzon Expressway (SLEX). The

hospital stands on a 17,250-square metre campus, carefully planned and specially designed by the architectural firm Anshen and Allen, a United States firm recognized for sustainable building practices and outstanding architectural design for healthcare and academic markets.

Makati Medical Center (MMC)

Located at the heart of the country’s primary central business district, MakatiMed has a 565-bed capacity and delivers quality and compassionate service through its network of highly skilled and board-certified physicians, compassionate nurses, competent allied healthcare professionals, and management staff. This is well-complemented by modern facilities and cutting-edge medical equipment and technology.

Cardinal Santos Medical Center (CSMC)

Cardinal Santos Medical Center (CSMC) is a modern, 245-bed tertiary general hospital located in a 3-hectare area within an exclusive residential enclave of Greenhills West and is one of the country’s most sought-after medical centers for professional and excellent healthcare service.

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Collectively, the three hospitals

Employ almost 5,000 people

Performed over 40 medical missions and outreach activities, with more than 11,000 beneficiaries

AhI MMC CSMCReaccredited by the Joint Commission International

Opened its Asian Cancer Institute in 2015

Developed an integrated, digital system to handle an increase in patient volume

Better complaints management through ACTS (Automated Complaints Tracking System)

Awarded Gold in the Asian Hospital Management Awards

Initiated several environmental initiatives, particularly a remarkable waste management program


ASIAn HOSPITAL And MEdICAL CEnTER

AHI's building design has built-in safety features that include power and water reserves for 5 to 7 days. Standard fire safety features are complemented by magnetically held doors that are linked to the Fire Detection and Alarm Systems (FDAS). The doors will automatically close to isolate areas and elevators during a fire. The elevators in the hospital are likewise equipped with an earthquake detection device that, when triggered, brings the elevator car to the nearest floor to ensure patient safety. Asian Hospital is a Magnitude 7, Intensity 8 earthquake ready facility.

On September 16, 2016, the Asian Hospital was reaccredited by the Joint Commission International (JCI) — a United States-based international accreditation body which aims to help Healthcare organizations globally deliver the highest quality of patient care services. It was a testament to the Asian Hospital’s relentless vision to provide the highest safety and quality standards for its patients.

Among its notable initiatives in pursuit of efficiencies, Asian Hospital partnered with Healthcare Information and Management Systems Society (HIMSS) in March 2015 for the full digitisation of its electronic medical records. Under the new system, admission, paper, and billing processes have transitioned to faster processes.


The results of the programs AHI has been implementing are encouraging, and illustrates that the hospital is in the right direction. AHI’s ER average length of stay was 3.2 hours in 2016. This is 1.2 hours below the 4.4 hour average of the top 100 hospital in the US. The hospital’s unplanned readmission rate was at 0.04 patients per 1000 Emergency Department consults, lower than the benchmark set by the International Journal of Emergency Medicine in 2016 at less than 1%.

Meanwhile, AHI nurses have been undertaking great effort in preventing patient falls’. Regular assessments of a patients’ fall risk are done by the nursing staff so that preventive actions may be applied. The hospital’s inpatient fall rate was at an average of 0.38 falls per 1000 inpatient days in 2016, well below the international benchmark of 2.75 falls per 1000 inpatient days as according to the National Database of Nursing Quality Indicators (NDNQI) for the year.

The APAC Business Insider Awards 2016 heralded AHI as the “Best Tertiary Healthcare Facility - Philippines” counting the company as among the outstanding and innovative healthcare businesses in the Asia Pacific.

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ASIAn HOSPITAL And MEdICAL CEnTER


SERvICE ExCELLEnCE

Asian Hospital’s Patient Experience Survey is an adaptation of the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey and is an integral part of the hospital’s quality management. Year-end results in 2016 were at 95% for inpatients and 98% for outpatients. Both reflected a 23% percentile increase from previous results in August of 2015.

AHI has partnered with Novostorm Technologies Inc., a Philippine-based healthcare technology solutions provider, to pilot a Patient Flow Monitoring System in our Emergency Department. The partnership approach uses proven data capture technology to simplify data collection, organize data into useful dashboards, and use information to generate actionable insights and validate improvements. As such it embodies a true people-process-technology synergy, first pilot-started in 2015, the first of its kind in the Philippines.

After initial feedback and enhancements, Asian Hospital redeployed Novostorm’s RFID-based Patient Flow solution in its Emergency Department in June 2016. RFID tags are used to capture critical patient care steps as they happen, by tapping of RFID tags on strategically located RFID sensors. Consequently, such implementations have led to positive outcomes as evidenced by the improvements in the Emergency Department’s Patient Average Length of Stay (ALOS). This also translates to a 12% reduction in wait times for patients served at the Emergency Department.

The Joint Commission International (JCI) Accreditors, in its latest hospital assessment in September 2016, commended its deployment as a key enabler to its care coordination and access to care standards. Currently, Asian Hospital is

working with Novostorm on the solution’s full hospital deployment, as well as taking lead on focused improvements on areas pointed to by data. Indeed, Asian Hospital continues to live by its Innovation Leadership mission, using technology, data analytics and Lean Six Sigma approach as essential pillars in taking its healthcare service delivery to the next level.

One good example is the hospital’s care for Cancer patients. Cutting-edge, innovative and evidence-based treatment follows a Multidisciplinary Team (MDT) approach where joint expertise is leveraged to the benefit of the patient. The Asian Cancer Institute opened in July 2015, a “one-stop shop” setup that centralizes cancer prevention and management where the most advanced cancer therapy technology and leading oncology professionals are accessible in one facility.

The Institute offers the most advanced Radio Therapy services with its state-of-the-art, image-guided, new TomoDirect™ Tomotherapy HDA-H Series machine system that treats a full spectrum of patients without compromise and ensures the highest standards of precision and safety. In addition, it has an advanced High Dose Rate capable Brachytherapy system and MX16 Evo CT scans.

In 2016, the Asian Cancer Institute hosted the Implementation of Optimisation As Low As Reasonable Achievable (ALARA) Principles and Radiation Protection Program for Medical Applications. This was in partnership with the International Atomic Energy Agency (IAEA), the Philippine Nuclear Institute (PNRI) and the Department of Science and Technology (DOST). The event was the first of its kind to gather Radiologic Technologist from the Middle East, South and South East Asia, and Oceania.

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Productivity toward Quality of Life

Healthcare in the Philippines is one of the biggest problems in the country. Because of poverty, many Filipinos are not able to give importance to their health. Their lack of awareness leads to ignorance that compromises their health condition and even worst causes death.

The Asian Hospital and Medical Center (AHMC) being true to its mission of providing access to its quality Healthcare extends its facilities to indigent patients who are in dire need of medical assistance to help restore their health, live their lives to the fullest, and more importantly continue to provide for their families for a decent living.

Asian Hospital Charities, Inc. (AHCI), the official charity arm of AHMC gives hope to sick individuals by facilitating access to AHMC. The moment the patient comes to AHCI for assistance, it strives to consistently deliver a fair and careful pre-assessment, provides family conferences with the specialists for clear understanding of what the patient will undergo and expect from his treatment/procedure, treats them with the same level of care, and the most important part of the process is the home visits done by the Medical Social Worker (MSW).

The home visit is AHCI’s way of measuring its success after the medical assistance is provided. This is unique to AHCI because the assistance to the patient doesn’t stop after the treatment, it continues until they reach their homes and get back to their routine. We build relationships and motivate the patients to regain their self-worth after their illness. They slowly go back to their productive self, and eventually live a quality life.

Mang Raul, a bread winner and a linen staff in a public hospital, suffered from Coronary Artery Disease and needed an Angiogram for further medical evaluation. He was advised to take a leave without pay from work until he is cleared from his health condition. This arrangement added to the family’s burden because they have no other source of income to sufficiently support their needs and his medications, his wife is jobless, and they have 2 kids who go to school.

Aling Ligaya, a dedicated housewife with 2 children, suffered from Stage II Breast Cancer and needed Chemotherapy sessions. She felt weak each day and couldn’t closely monitor and take care of their children because of her condition. Her anxiety to raise the much needed money for her treatment disturbed her during moments when she was alone.

After the medical assistance is provided, the MSW monitors their recovery and arranges for home visits. What happens during the visit? The MSW stays for a few hours to talk to the patients makes sure that the other family members are also there during the “kumustahan”. The MSW is more like a relative or close friend visiting them. MSW confirms her pre-assessment during her visit.

Mang Raul is back to work as Linen staff and even better as he and his family opened a small Lugawan in front of the house they’re renting. Aling Ligaya continues to recover from her last chemotherapy session but feels stronger and better now and slowly helps in her mother-in-law’s small sari-sari store.

AHMC together with AHCI helped restore their health, regain their self-worth, and rebuild a productive and quality of life.



AHI focuses on staff development and promotion through empowerment programs, such as: Leadership Learning Series with the CEO, COOLER Talks, Employees’ Recognition Day, physical and spiritual wellness activities, and the like.

AHI has regular performance and career development reviews with employees. Management support to Employee Training and Development at AHI is total; not only are staff member’s knowledge and skills advancement, focused on, character formation is also held in high regard.

Majority of the training undertaken by employees necessarily relates to health, raising ability levels, and/or basic to advanced specialty courses as with the nature of services AHI renders. On top of these, at AHI the pursuit of higher learning and/or trainings in management and administration is given equal support and appreciation.

GENDER

Male

Female

471

1,844

sTATus

regulatory

Probationary

1,145

170

G4-10

125Hospitals


In line with the hospital’s mission to provide assistance to the communities it serves, the AHI’s Corporate Social Responsibility (CSR) unit and its official charity arm, Asian Hospital Charities, Inc. (AHCI), have successfully implemented health awareness and wellness programs to select underprivileged patients and communities in the Southern Tagalog region.

AHCI partnered with the Gender and Development (GAD) Office of the City of Muntinlupa to subsidize the Breast Ultrasound and Digital Mammography of GAD-referred patients. The partnership launched last September 2016. AHCI further extended medical assistance to four (4) qualified charity patients with high intensity cases. Included are two kids with congenital heart disease — one for open heart surgery, and one with chronic kidney disease.

In collaboration with Icanserve and Muntinlupa City Gender and Development Office, Asian Hospital and Medical Center conducted a free breast screening and workshop last March 2016. This was done in partnership with the Barangay Health Workers of Muntinlupa and its constituents at the different health centers within the city. Indigent patients were provided with free breast screening procedures to increase the awareness and early detection of breast cancer, the most prevalent cancer in the Philippines.

A number of health education programs were also cascaded to communities and schools in 2016 focusing on Heart-Healthy Diet and Nutrition, Women’s Health, the Zika and Chikungunya Viruses, Cancer, and even Sports Coaching. Medical equipment were also donated to the Jose Escaler Memorial School. Non-health related activities were also set, such as Christmas related outreach including a sponsored Children’s Christmas Party.

These activities were on top of the Medical Missions conducted at the nearby Parañaque Elementary School and in Brgy. Dela Paz in Laguna where for the latter 1,000 patients were seen to attend the event.

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MAKATI MEdICAL CEnTER


Makati Medical Center is unwaveringly dedicated to upgrading the level of patient safety in the Philippines, with expansion of its services, worthy investment in advanced equipment and facilities, and innovation in processes through the use of technology.

In 2011, MakatiMed received its Joint Commission International (JCI) accreditation, and only the 4th hospital in the country to be so accredited. This 2017, MakatiMed will undergo its triennial survey for the 6th edition of the JCI standards.

In 2010, MakatiMed launched MakatiMed On-Call, the very first dedicated in-house hospital call center in the country. The call center manages inbound calls, handles appointment bookings for various outpatient services, makes outbound goodwill calls to patients for continuity of care and management.

To better support the increase in the volume of hospital patients and transactions, MakatiMed entered into an agreement with leading information technology company Indra in 2011 to develop an integrated system that would replace MakatiMed's 15-year-old Magic (outpatient) and Harmony (inpatient) systems. iHIMS, an integrated system that handles services including patient registration and administration, inpatient admission, discharge and transfer, appointment scheduling, outpatient management, and billing and cashiering, went live on April 15, 2013.

MakatiMed is also the first hospital in the country to offer TomoTherapy treatment, a revolutionary

development in cancer care. TomoTherapy utilizes the latest form of image-guided radiation therapy to correctly identify and locate tumor sites before each radiation session, thus making treatment more precise. It also reduces many common side effects associated with radiation treatment.

TomoTherapy was launched in 2012, along with the inauguration of MakatiMed’s Cellular Therapeutics Center, which made MakatiMed one of only four hospitals that received accreditation from the DOH as a hospital-based facility engaging in cell-based therapy in the Philippines.

In 2014, MakatiMed rolled out the CAB (Computer at Bedside), a mobile medication delivery system to aid nurses in the safe administration of medication and in accessing accurate patient information without leaving the patient’s bedside. A CAB is a computer on a mobile cart that nurses can easily wheel from one patient room to another. This mobile facility contains software and programs that help doctors and nurses administer the correct medication, ensuring efficient, accurate, and quality patient care.

Meanwhile, in line with its commitment to patient safety, MakatiMed expanded its partnership with MIMS, a leading provider of drug information and medical education for healthcare professionals, with MIMS Integrated, which enables medicine information and decision support data to be embedded within the hospital’s prescription workflow. This enables doctors, pharmacists, and nurses to have point-of-care access to medicine information and medication safety alerts.

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MAKATI MEdICAL CEnTER

MIMS Integrated will interface with MakatiMed’s iHIMS, and will be a vital component of the hospital’s Electronic Medical Records (EMR) Project. In EMR, which will be rolled out this year in MakatiMed’s inpatient units, doctors enter medication orders electronically instead of on paper.

With MIMS Integrated in place, doctors will receive medication safety alerts such as drug interactions, drug allergies, drug duplications, overdoses, contraindications and more, at the point of data entry, allowing the medical professional to make the necessary changes prior to prescription and greatly reducing medication errors.

In 2016, MakatiMed also launched the MMC HealthHub, located at the 1st Floors of Towers 1 and 2. These were benchmarked against international healthcare practices, guided

by international standards and MakatiMed’s commitment to total patient satisfaction.

The MMC Health Hub offers packages that were also remodeled to fit the changing health and lifestyle needs of patients. All patients begin with the Health Investment Essentials, a basic package that includes a physical examination, complete blood count, urinalysis, fecalysis, and chest X-ray. Specific health packages or riders can be added to the basic package to give a patient a complete and clearer picture of his or her health profile. Post-menopausal women, for instance, can choose from a roster of Female Rider procedures, while diabetics can include tests from the Diabetes Rider. There are also riders that are specific for males and teenagers, a total health screening package for those who want to have everything checked, and health screenings focused on the heart and abdomen.


For those who do not want to create a screening plan, the HealthHub offers pre-designed packages.

The inpatient MMC HealthHub, known as MMC HealthHub Premier, located at the 1st Floor of Tower 2, is situated on 505.6 square meters with 14 new inpatient rooms (Large Private) dedicated to this service. Now, every patient is assigned an Executive Liaison Officer (LO) to personally guide him or her through every step of the patient’s pre-planned medical itinerary.

Makati Med also has a program called the Strategic Hospital Alliance Program, or SHAP, which it has been implementing since 2010. Managed by the Marketing and Sales Services Division, SHAP is geared toward sharing MakatiMed’s services to the rest of the country by establishing partnerships with hospitals, clinics and facilities located in other cities and the provinces across the Philippines. It has also partnered with several

individuals and company providers engaged in the referral business for health services abroad to help reach Filipinos and foreigners needing world-class compassionate medical care.

MakatiMed reached another milestone in nursing education with the accreditation of its Nursing and Patient Care Services Division as a Continuing Professional Development (CPD) Provider. This was the first nursing education accreditation received by the MakatiMed nursing division. It is also the first accreditation for a hospital-based CPD Nursing training program.

This was followed by the accreditation of the Department of Pharmacy as a Continuing Professional Development (CPD) Provider in Pharmacy Training by the PRC. PRC awarded the accreditation on December 12, 2016, which is valid until 2019.

SERvICE ExCELLEnCEKnowing that complaints handling is at the heart of service excellence, MakatiMed launched the Automated Complaint Tracking System (ACTS), a hospital-wide database and monitoring system for patient complaints in 2015. All reported complaints, investigation data, resolution and correspondences with the patient or complainant will be logged in this system. All, as in every single one, of the complaints can be accessed and monitored all the way up to the level of the President and CEO who ensures that no concern or issue raised by a patient falls through the cracks. Resolution and turn-around time for complaints are kept at eight (8) days at most for complex cases.

The hospital is also the first of its kind in the country to offer TomoTherapy treatment, considered a revolutionary development in cancer care. TomoTherapy utilizes the latest form of image-guided radiation therapy correctly identifying and locating tumor sites before a radiation session. Treatments are therefore more precise and common side effects associated with radiation treatment are lessened.

MakatiMed’s Cellular Therapeutics Center was launched the same year as TomoTherapy. This made MakatiMed one of only four hospital based facilities in the country to receive accreditation by the DOH for cell-based therapy.

129Hospitals

‘MakatiMed has long been the hospital of choice for me’

I am writing to commend the doctors, nurses and staff who saw to my cure and comfort while I was confined at MakatiMed due to a serious urinary problem.

Hands down, I would give my highest praise to your consulting urologist, Dr. Stephen Nazareth. He adds a touch of humor in his explanations and said that his philosophy includes the doctor should also dispel fear from the heart of the patient.

I would like to next commend the nurses who made our stay a warm and pleasant experience: Emily Sy, RN; Ria Nicole Arroyo, RN; and Nathaniel Flloyd Furtuno, RN.

Other nurses whom I remember fondly with their faithful and compassionate services were Ma Erica Victoria ‘Via’ Vizcarra, RN, Janine Antennor-Cruz, RN, and Kathleen Marie Monroy, RN. Special mention to Ronilie Mercado, RN who was thoughtful to have me sign the CF2 as early as 5 am to have my papers processed before the morning rush.

All of these are a tribute to the leadership of the supervising nurse for those night shifts, Lina Hemady, RN. Commendation should also go to Charge Nurse Ma. Ofelia Katrina Agapito, RN.

Non-medical personnel who made my stay a positive rather than a sour experience: Rowena ‘Weng’ Bascos, nursing aide; Clinical Pharmacist Mary Ann Benjamin; Alma Nalaza of Housekeeping; and Ward Clerk Mariel Pajarillo.

May I end this letter by saying that MakatiMed has long been the hospital of choice for me, my family and my in-laws. That my stay from September 25 to 29 has relieved my immediate distress and ended with long-term solutions, and assured of further compassionate and competent care should future medical issues crop up, will be one of my highlights this year. We look forward to continue patronizing your excellent hospital.

Very truly yours,

Nelson T. Dy



MakatiMed’s workforce was 2,597 strong in 2016, a good 68% of whom are female. It was also a young and energetic staff, with about 63% of the employees were aged 30 years and younger.

Male

Female

30 to 50

Under 30

Over 50

rank and File

Supervisors

Middle Managemement

senior Management


Employment by rank


1,635

861101

1,769

828

1,974

525

7919

G4-10

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As a dynamic organization seeking to be always at the forefront of medical knowledge and new technology applications, training and development for all personnel is key. Therefore, specialist training across the ranks is given every year and regular employees receive performance and career development reviews.

Non-standard training is provided to employees to increase their competency levels and response readiness for situations where immediate care is critical. Included in this are certification programs that empower them primarily as healthcare practitioners and secondarily as MakatiMed employees.

Type of Program

Advanced Cardiac Life Support (ACLS)

184 Participants

Participants

Participants

Paediatric Advanced Life Support (PALS) 108

Neonatal Resuscitation Simulation (NRS)

45

Once a month

Once a month

Once to twice a month



MakatiMed employs a three-pronged approach to provide much needed services to indigent patients. This is through the annual conduct of medical missions within its community and in reasonably reachable cities and provinces, the Hospital Service Program (HSP), and various CSR initiatives under the arm of the hospital’s foundation, Makati Medical Center Foundation (MMCF).

In 2016, it participated in a total of seventeen (17) medical missions reaching communities in the cities of Makati, Muntinlupa, Parañaque, Manila, Mandaluyong and Marikina, and the provinces of Laguna, Cavite, Pampanga and Isabela. Health concerns addressed were those related to General Medical, Ophthalmology, Obstetrics and Gynecology, Paediatrics, ENT, Minor Surgery, and Dental concerns.

For indigent patients qualified and able to go to the facility, MMC has a Hospital Service Program (HSP) which gives support to patients who cannot afford the full cost of medical treatment. This also provides support for the continuing medical education and training of MakatiMed residents, interns and other health practitioners. Covered under HSP is free consultation with MakatiMed

doctors and discounts on selected medical procedures as required by the MakatiMed’s residency program. The HSP is managed by a dedicated HSP department composed mostly of social workers and nursing aides.

HSP served a total of 32,052 patients for consultation in 2016, with 1,011 availing themselves of discounted outpatient procedures, and 1,286 patients admitted with doctors’ professional fees waived. A major thrust of MMC’s Foundation is its aim to help other (mostly government) hospitals in terms of management and application of best practices. The Foundation also lends a hand to help raise funds from sponsors benefitting MMC patients under its charity programs.

In collaboration with the MMC Foundation, the Philippine Disaster Resilience Foundation (PDRF) launched mobile eHealth Centers in Biliran province and Tacloban City, Leyte. These are areas hit by super typhoon Yolanda (Haiyan) in 2013. MMC Foundation’s commitment is the provision of free telemedicine services—medical consultations coursed through telecommunication, video and information technologies.

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133Hospitals

The collaboration between MMC Foundation, the PDRF and other project partners align with the rebuilding phase post Yolanda.

A eHealth Center is a re-purposed container van outfitted with medical equipment. Each eHealth Center is a “doctor-less” facility manned by trained nurses and LGU personnel. Through video-conferencing technology, patients are able to consult with specialists at the MakatiMed. There is a dedicated studio located at the HSP, where a rotation of doctors and specialists provide daily consult. Even patients living in remote places benefit from this combination of technology and expertise thus receiving quality care without the expense and stress of travelling far.

In the immediate aftermath of Yolanda, a 24-person medical team gave on-the-ground medical aid to approximately 4,000 of Yolanda survivors. Assisted by then AFP Chief of Staff General Emmanuel Bautista and his team, MakatiMed also released and distributed 1,000 emergency family health kits through the MMC Foundation in coordination with the Professional Regulation Commission. Yolanda donations raised by MakatiMed reached close to ₱10 Million.

More recently, Philex Petroleum, through MMC Foundation, donated ₱1 Million worth of brand-new hospital equipment to two military medical facilities in Palawan in August 2016. These were the Camp General Artemio Ricarte Station Hospital of the Philippine Air Force and the Medical Dispensary of the Naval Forces West of the Philippine Navy. Efforts are ongoing to improve their station hospital and sick bays. This is an allied project of MMC Foundation and SM Foundation.

In addition, senior citizens and PWDs (persons with disabilities) comprise a sizeable segment of MakatiMed’s patients. In 2016, MakatiMed

served 107,978 senior citizens and 10,483 PWDs for both inpatient and outpatient services, translating to almost 13% of total hospital patients. The hospital is fully compliant with the rules of the DOH and respectful to senior citizen and PWD rights to applicable discounts.


CARdInAL SAnTOS MEdICAL CEnTER


We are in the business of saving and improving the quality of life. This mission-based vocation is powered by our Caring Cardinal Leaders - credentialed doctors, competent, professional and highly engaged employees and dependable partners committed to deliver the highest quality of care to our patients, partners and the communities we serve.

Delivering Superior Health Outcomes

• An average of 97.38% of our inpatients are discharged due to improved health outcome

• Low mortality rate of 2.28% vs 3% limit

• Controlled infection rate of 0.52%- better than 2% limit

Improving Capacity to Serve More

• More patients served with an average increase of 8% in the last 3 years (2014-2016) and an average inpatient bed utilization rate of 80%

• Increasing bed capacity by 23% (46 new rooms) and the construction of a 5-level steel parking facility to accommodate an additional 347 slots for our customers

• 38,929 indigent patients served from 2012 to 2015

• Adopted and partnered with 4 San Juan barangays, 4 parishes, 3 NGOs and 2 schools

• Progressive and comprehensive employee remuneration package improving by 8% annually

• Annual gross revenue growth of 10%, NPAT growth of 30%

Leading through our Best-In Class Services

At Cardinal Santos Medical Center, we put the safety and convenience of our people first. We exist to provide the best service for our patients and customers. We care for our patients the way we would take care of our own family members. Strides to continue the path towards innovating for and with our customers are evident in CSMC’s best

ading through our Best-In Class

• First and Most Trusted GAMMA Knife Center in the Philippines Known for its success and state of the art technology in the fields of Neurosurgery, Cardiology, Oncology, Rehabilitation Medicine and Minimally Invasive Surgery, CSMC is also the only hospital in the country to offer a Gamma Knife Center which caters to “surgery without incision” procedure for treating brain tumors and vascular malformations, heralded by experts for its extreme accuracy, efficiency, and outstanding therapeutic response.

• Pioneering Deep Brain Stimulation System and Motion Robotic Solutions We take pride for being the hospital in the country which pioneered Deep Brain Stimulation (DBS) for the treatment of Parkinson’s disease, essential tremor, and Dystonia through the Movement Disorder Surgery Center. We also take pride in being the first and only hospital today to offer in motion robotic solutions for rehabilitation therapy.

135Hospitals

CARdInAL SAnTOS MEdICAL CEnTER

• Contributing to the Profession through the Philippine Center for Advanced Surgery Minimally Invasive Surgery Training Center (PCAS-MIS) This is one of Asia’s Minimally Invasive Surgery (MIS) training facilities and the first of its kind in the Philippines. It is designed to grant medical experts, here and abroad, access to modern surgical facilities and technologically enabled learning sessions facilitated by internationally acclaimed medical professionals in the field of advanced surgery. This facility of CSMC will provide educational opportunities available for Filipino Surgeons so that more and more patients will gain access to the advancement of Minimally Invasive Surgery (MIS), a service that improved the average health outcome.

Green Initiatives

The hospital converted to LED lighting (from CFL) helping reduce emissions by 0.85 metric tons annually. There are also plans to install variable frequency drivers for all of its motor driven equipment.

CSMC organized a Waste Management Committee, coming from different departments, to ensure organizational-wide reach of programs. The Committee has identified three targets, namely: to increase waste segregation awareness and

compliance, increase recyclable collection and decrease hazardous waste collection.

An awareness campaign, “Waste Management is Everyone’s Responsibility” was implemented and the topic of Proper Waste Management was officially incorporated in the New Employee Orientation Program.

Connected to the recycling effort is the project “Vegetables for a Cause” where vegetables such as pechay, saluyot and okra are grown in empty alcohol dispensers and sold to hospital employees. Proceeds are donated to the CMCFI.

Like a man on a mission, the best for Cardinal Santos Medical Center and its army of Caring Cardinal Leaders is truly yet to come.

• Investors in People Silver

• Finalist: Excellence in Social Responsibility (2016 IIP Awards, UK)

• Gold Award: 2016 Asian Hospital Management Awards for Integrated Media Engagement Program (IMEP), Marketing, PR, Online Presence Category

• People Management Association of the Philippines’ Employer of the Year for 2016


SERvICE ExCELLEnCE

Everyone in CSMC aims to be their best every day. The services we provide ensure integrity, teamwork, excellence, malasakit and servant leadership. Being a Caring Cardinal Leader is integral in the makeup of every Cardinal doctor and employee; caring service is at the core of the hospital and is fueled by the passion of giving excellent customer care always.

Innovating for and with our Customers

Innovating for our customers is institutionalized through our Discharge Anytime Program where an inpatient can be discharged anytime of the day as soon as his doctor gives the clearance. A cross-functional team of Admitting, Billing, Nursing and Medical teams had to collaborate and challenge existing practices to put this in place. Because of their efforts, this program now gives convenience and cost efficiency to inpatients and allows the hospital to free up rooms and reduce waiting time for admissions, transfers, and discharges.

With the Discharge Anytime Program, discharge procedures and resources are aligned towards achieving the desired patient experience. With this innovation, a patient’s

discharge can now be processed because of the empowerment and authority given to nurses and frontliners to complete paper requirements from within 30 minutes to 3 hours. In 2016, 50% of patients discharge are now spread outside the peak hours (10am to 2pm).

Value-Added Services Driving Continuity of Care

Together with the patients, we actively involve family members in the overall care plan so that the continuity of the treatment and the service is assured when they are back in their own homes. It is this wanting to serve and provide care even outside the halls of our hospital which led us to innovate through our Cardinal on Wheels (COW) service.

The COW is a mobile diagnostic and after-care service in the convenience of our patients’ homes. This service is also for our geriatric and senior citizen patients who may not be as mobile to go through the rigours of traffic just to reach our hospital. Instead, we bring the caring service of Cardinal Santos Medical Center to them through our Cardinal on Wheels.

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Caring Cardinal Leaders

At Cardinal Santos Medical Center (CSMC), the healthcare staff acts as multidisciplinary team, constantly and consistently communicating with each other to address patient needs.

An example of how this multidisciplinary team approach works is a very interesting case of a Michael (not his real name) who had a freak accident in the gym. Michael was lying down on a bench press area when his fitness trainer accidentally knocked over a 105-lb barbell that was resting above his head. The barbell fell on his face.

He reported hearing a cracking sound and felt himself on the verge of blacking-out. “Blood was flowing from my head like a fountain and I noticed only one eye was functioning normally,” Michael said. Through all the panic of the people in the gym, he specifically instructed them to bring him to Cardinal Santos Medical Center in San Juan.

Minutes after arriving at the Emergency Room, his family doctor Dr. Perfecto Palafox arrived. After seeing him, Dr. Palafox immediately contacted ENT specialist Dr. John Michael Porquez, who did the proper first aid interventions.

It was only the first step for Michael’s healing. “I thought I merely broke my nose from the impact. It was only when Dr. Porquez explained my situation that I realized the gravity of the damage. The impact left a crack on my forehead, exposing my brain and the entire mid area of my face caved in. My left eye was also displaced from the socket.”

Dr. Porquez put together a team of doctors including the Neurosurgeon Team of Doctors Eduardo Mercado, Michael Louis Gimenez and Gilbert Rañoa, the team of Ophthalmologists Dr. Jo Anne Hernandez and Dr. Mark Anthony Imperial and Anesthesiologist Dr. Editha Fernandez. Michael was monitored daily by this team of doctors and was provided with good patient care by all nurses.

“My surgery was set within a week of the accident. The day after the surgery, I woke up with 20/20 vision on both eyes, my brain was cleared from danger and damage and my face was successfully reconstructed!”

“Everyone’s expert care and comforting way of dealing with the patient made my road to recovery a comfortable and reassuring one.”

Less than two months after, Michael was already travelling to Korea to attend the Korean International Film Festival. “I had no problems with the high altitude during my plane trip and I felt strong and healthy as if I never had a life threatening accident merely two months earlier.”

True to its leadership brand of “Caring Cardinal Leaders”, CSMC ensures availability of resources — competent professionals, state-of-the-art medical equipment, and high-end facilities — and creates an environment that promotes holistic healing of its patients.



Conquering Challenges through Our Values in Action

In 2015, we had a problem with tardiness and absenteeism increasing to 18% vs 2014, costing the hospital and the employees monetary losses equivalent to ₱715,000 increase from the previous year. Staff morale was affected especially when those who came in early found themselves at a disadvantage having to cover for those who were tardy or absent. Service was affected and posed several risks to our patients when nurses must extend their shift. Personal time with the family was sacrificed when our nurses on time-off were recalled and were asked to report for duty because another staff was absent.

We decided to bring to life our leadership brand and show how we can be servant leaders - modelling the way across all levels most especially at the top. Team Clockwork, a cross-functional team was formed, to come up with an integrated program to address Work Hour Losses (WHL). They talked to leaders and employees about the root causes of the problem and came up with several solutions to be driven across the organization. Two major changes were made:

• A Team Rewards Program - Reduction of WHL is a key performance indicator (KPI) for every department’s Quarterly Performance Reward. The amount of reward the team gets is based on how well they performed against their KPIs which included WHL reduction. Leaders had to coach daily and rally their teams to keep to the goals. They had to have difficult conversations and encourage employees to be more mindful of team outputs.

• set the Tone at the Top — every leader took responsibility for the change of culture in their division by modeling the right behavior and engaging their team to commit and live our values of integrity and teamwork. Executives, managers and supervisors themselves monitored their own performance and

attendance to show that there is no exemption in our WHL reduction program.

After 12 months of implementation we achieved a 24% reduction in WHL for 2016 vs 2015, a feat higher than the original target of 10% reduction. This is further translated to 17% decrease in losses vs 2015 or a savings of ₱793,000.

In 2016, CSMC’s workforce was 1,053 strong, majority of whom are female at around 64% of the population. This ratio is maintained even at leadership positions where women hold about 61% of the positions in Middle and Senior Management.

MaleFemale

30 to 50Under 30

Over 50

rank and FileSupervisorsMiddle Managemement

senior Management


Employment by rank


672

381

945

10 3167

555 431

67

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139Hospitals

Our hospital will not run without our people. The employees who work 24/7 to ensure that operations are smoothly flowing and that patient care and safety is foremost is the bloodline that keeps the heart of the hospital beating. That is why when we approach the company’s goals, objectives and strategies, we ensure that our people are our number one strength. Investing with and for our people have proven to be a fulfilling venture and a win-win proposition for our employees, our partners and our organization.

Innovating for Our People

In 2012, we have implemented an alternative work scheme for our nurses in the General Nursing Wards consistent with the 40-hour workweek requirement which provided our patients with better continuity of care through lesser endorsements, and provided our nurses with flexibility of time to pursue their own interests and passions, spend more time with their loved ones and save on their meal and transportation expenses. On its fourth year, the same arrangement is being piloted in other areas of our organization in response to the current traffic congestion in the Metro and the developing state of our public transportation system.

Investor in People

Growing our organization well into the future will only be viable and sustainable if we continue to grow and invest in our people. We have systematized and institutionalized a curriculum type of learning and development program for our employees, especially as they build their technical expertise in our organization. We have introduced fresh learning methodologies such as Ed Talks (or Educational Talks) where anyone can take the center stage to hone his/her platform skills and confidence in public speaking while sharing their expertise with the rest of the community, e-learning to allow our employees

to learn at their own pace and time, lunch and learn sessions and one-point lesson programs to help build a culture of learning something new every day.

Building a Culture of Safety Based on Mutual Trust and Genuine Concern for People

At Cardinal Santos, people and physicians are developed holistically. We provide them with continuous learning and development opportunities that would encourage career and personal growth. We partner with our in house chaplain to enrich our people’s spiritual growth through different retreats, recollections and chapel activities. Our CSR programs are driven by our volunteer group of employees and doctors who lead and implement activities that reach out to the communities around us.

Internally and externally, we conduct and engage in a lot of benchmarking activities. This allows us to always be mindful of current technologies, practices being used and done in other institutions, improve our systems and practices by learning from others. All of these things are being done in order to give the greatest value and service to our customers.

Since 2013, we have graduated an average of 46 doctors in our post graduate internship training program. Our Out Patient Department trains our residents as they oversee the OPD operations. Every year, we strive to implement at least two (2) new health service initiatives to be able to offer a wider range of services. This practice helps them hone their skills and gets them exposed to a variety of medical cases that would enrich their study and knowledge of their field.

Transparency, respect for people, professional humility and open communication even when we disagree are essential to how relationships are built and enhanced in our hospital.



Sustainable Partnership with the Community

CSMC’s Medical Training Program is one of its bests, it goes beyond shaping excellent medical experts as it supports the organization’s undertaking to serve the underprivileged through the Cardinal Medical Charities Foundation Inc. (CMCFI).

CMCFI is a portal of opportunity for benefactors and experts to extend their generosity to the indigent communities primarily of San Juan City and afford them access to the expertise and specialized care that CSMC can deliver. CSMC’s partnership with CMCFI is a potent source of composite medical cases for medical trainees and an avenue in providing the destitute communities with quality Healthcare at no cost. Thus, making medical learning curriculum and experience meaningful, rich and fulfilling for the aspiring medical doctors, for CSMC as an organization and the communities that we serve.

For many Filipinos, it can be challenging to spend thousands to Millions of pesos to pay for either a dialysis or a heart surgery. As a developing nation, the Philippines is on the journey of improving its healthcare system to make it more affordable for the underprivileged population.

Cardinal Santos Medical Center (CSMC) plays a major part in the advancement of this national mission for the benefit of the communities we serve. Through the Cardinal Medical Charities Foundation Inc (CMCFI), the CSR arm of Cardinal Santos Medical Center, we implement an organized, progressive, and sustainable Social Responsibility (SR) program that leverages on our core services, geared towards better health outcomes, responsive health services and programs.

We collaborated with the Local Government of San Juan, the City Health Office and the Division of City Schools to identify areas where relevant and urgent interventions are needed. Through comprehensive community-based researches, we discovered that poverty and low health literacy are strong needs for many areas in the local community. Our direction in SR is to improve the low level of health literacy, grant easy and affordable access to medical services, and improve health conditions of underserved communities.

Our approach involves our people to take an active part in our SR programs. They serve as subject matter experts and facilitators of health-learning programs for communities. We have the San Lorenzo Ruiz Ward and a dedicated-Out

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141Hospitals

Patient Department who prioritizes our charity patients. Our people donate a percent of their salaries to support the feeding program for malnourished children which served 550 children from 2013-2016 active community engagement.

Health Advocacy and Literacy

As a responsible health institution with highly credentialed medical professional and staff equipped with modern medical facilities, we took advantage of our expertise and reached out to vulnerable members of the community through the Health Advocacy and Literacy (HEAL) Program. The HEAL Program is the proactive response of Cardinal Santos Medical Center (CSMC), to the worsening health situation among underserved communities. cognizant that limited health literacy has negative implications for health outcomes, Healthcare quality and Healthcare costs. The HEAL Program is our integrated community health education program. The program is designed to equip residents of Brgy. Corazon De Jesus (CDJ) in San Juan City with correct and relevant health information to positively influence their health practices and choices towards better health outcomes.

Through the program’s integrated approach utilizing community lecture, Focused Group Discussions and referral system, health understanding in the community significantly improved. This is evidenced by the locals’ active participation in community health lectures and an increase in numbers of consultations at the Barangay Health Center, including patient referral to our Out-Patient Department that resulted to actual medical management and treatment.

Doing Well and Doing Good

Exceptional to Cardinal Santos Medical Center is the inclusion of Corporate Social Responsibility component in our performance scorecard. We recognize and continue to affirm that the very foundation by which our hospital was built is to serve the unserved, the underserved and the marginalized in our society. Year on year, we increase our target of servicing indigent patients.

The hospital’s balance scorecard is focused on programs for patient safety, people, customer and social responsibility believing that financial objectives will follow when the core areas of service are strong.


GRI Content Index

GENERAL STANDARD DISCLOSURES DESCRIPTION PAGE NUMBER/

rEMArks

STRATEGY AND ANALYSIS

G4-1 Statement from the most senior decision-maker of the organization 4

G4-2 Key impacts, risks and opportunities

18, 19, 26 (more information on risk

management section in MPIC's 2016 Annual Report)

ORGANIZATIONAL PROFILE

G4-3 Name of the organization 2

G4-4 Primary brands, products, and services 6

G4-5 Location of organization's headquarters 3

G4-6Number of countries where the organization operates, and names of countries where either major operations or that are specifically relevant to the sustainability issues covered in the report

18

G4-7 Nature of ownership and legal form 6

G4-8Markets served (including geographic breakdown, sectors served, and types of customers/beneficiaries)

8

G4-9 Scale of the reporting organization 22, 30

G4-10 Size and composition of workforce30, 45, 59, 76, 92,

124, 130,136

G4-11 Percentage of employees covered by collective bargaining agreements 76

G4-12 Describe Organization's supply chain

Not significant as the group does

not manufacture products

G4-13 Significant organizational changes during the reporting periodNone for the

reporting year

G4-14 How precautionary approach is addressed by the organization 26

For MPIC’s first Sustainability Report (SR) covering the year ended December 31, 2016, the Company did not obtain external assurance. For its subsequent SRs, the Company intends to procure appropriate external assurance services.

143


rEMArks

G4-15

Externally developed economic, environmental, and social charters,

principles, or other initiatives to which the organization subscribes or

endorses

N/A

G4-16

Memberships in associations (such as industry associations) and/

or national/international advocacy organizations in which the

organization is represented

N/A (not significant for head office /

holding company operations); MPIC’s

operating companies have memberships in their respective

industries’ associations

(please refer to MPIC’s operating

companies’ annual reports and

websites)

IDENTIFIED MATERIAL ASPECTS AND BOUNDARIES

G4-17List all entities covered in consolidated financial statements and not

covered in the report

Only 10 significant MPIC investees are

covered in this report as discussed on page

3. Refer to Notes 11 and 42 of MPIC's 2016 Audited Con-solidated Financial Statements for the

full list of associates and consolidated

investees.

G4-18 Process for defining report content and aspect boundaries 20

G4-19 List of material aspects identified 13, 20-21

G4-20 Aspect boundary within the organization 13

G4-21 Aspect boundary outside the organization 14

G4-22Any restatements of information provided in previous reports, and

reason for such restatementsN/A

G4-23 Significant changes in scope and aspect boundaries from previous reports

N/A (this is MPIC's first sustainability

report)




rEMArks

STAKEHOLDER ENGAGEMENT

G4-24 List of stakeholder groups engaged by the organization 18

G4-25Basis of identification and selection of stakeholders with whom

to engage14

G4-26 Organization's approach to stakeholder engagement 18

G4-27Key topics and concerns raised through stakeholder engagement and

how organization responded to those key topics and concerns18

REPORT PROFILE

G4-28 Reporting period for information provided 3

G4-29 Date of most recent previous report

This is the first

sustainability

report of MPIC

G4-30 Reporting cycle Annual

G4-31 Contact point for questions regarding report or its content 3

G4-32 Description of the report's compliance with GRI “core” reporting option 3

G4-33 Independent assurance statementN/A (please refer on

the footnote below)

GOVERNANCE

G4-34Governance structure of organization, including committees of the

highest governance body28

ETHICS AND INTEGRITY

G4-56 Organization's values, principles, codes of conduct and codes of ethics 2

SPECIFIC STANDARD DISCLOSURES

ECONOMIC

G4-EC1 Direct economic value generated and distributed

22 (more information in MPIC's 2016

Annual Report and MPIC's 2016 Audited Financial

Statements)


145


rEMArks

G4-EC2 Financial implication and other risks due to climate change

16, 17, 26 (more information on risk

management section in MPIC's 2016 Annual Report)

G4-EC5 Coverage of the organization's defined benefit plan obligations 30

ENVIRONMENTAL

G4-EN3 Energy consumption within the organization 32, 39,102

G4-EN5 Energy Intensity 39, 102

G4-EN8 Total water withdrawal by source 32, 71, 102

G4-EN15 Direct GHG emissions by weight (Scope 1) 54

G4-EN16 Indirect GHG emissions by weight (Scope 2) 32, 54, 102

G4-EN23 Total weight of waste by type and disposal method 41, 102

G4-EN29Monetary value of significant fines for non-compliance with

environmental laws and regulationsNone

SOCIAL

G4-LA2 Benefits provided to full-time employees 30

G4-LA5Percentage of total workforce represented in health and safety

committee59

G4-LA9 Average hours of training per year per employee by employee category 76

G4-LA12

Composition of governance bodies and breakdown of employees

according to gender, age group, minority group, and other indicators

of diversity

30

G4-SO1Percentage of operations with implemented local community

engagement, impact assessment, and development programs

32, 46, 62, 78, 95,

112, 125, 132, 140

G4-SO8Monetary value of significant fines for non-compliance with laws

and regulationsNone

G4-PR4Number of non-compliance issues with voluntary codes governing

product / service information None

G4-PR5 Results of surveys measuring customer satisfaction 42, 74, 88

G4-PR7 Incidents of non-compliances to marketing laws and codes None


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