Our social capital consists of the relations and partnerships we have fostered with our stakeholders in executing our business objectives and corporate mission. Guided by the Pentad Stakeholder Framework of Carol Sanford, we enrich our relationships with our customers, co-creators (employees, suppliers, and business partners), earth, communities, and investors. Through their support, we are able to continuously improve the value we provide to society. As a corporate citizen, we ensure our compliance with local and national laws and regulations. These ultimately grant our businesses the social license to operate in various parts of the Philippines. 

Our approach to managing our Social and Relationship Capital is detailed in the Sustainability Strategy section, which can be found on page 74.

Fostering Meaningful Engagements with Stakeholders

Maintaining mutually beneficial relationships with our stakeholders strengthens the efficacy of our conglomerate’s varying business models. Inspired by Carol Sanford’s Pentad Stakeholder Framework, our businesses understand the pivotal role each stakeholder group has to play in our value creation process. By working with these distinct groups, we shall accomplish our mission to collaborate for a decarbonized and regenerative future for all.

Stakeholder Engagement for the FPH Group

Safeguarding our Stakeholders by Respecting their Human Rights

Human rights due diligence (HRDD) processes

Human Rights Risks

Aligned with our social safeguards policies and our HRDD processes, our businesses are advised to regularly assess human rights risks associated with operations and project sites. This enables our group to implement programs, activities, and policies to ensure that the rights and dignities of our stakeholders are upheld at all times.

Grievance Redress Mechanism

Creating Value with and Through Our Customers

Our businesses are proactive in showcasing our products and services in various trade shows, roadshows, and conventions. This is done not only to acquire new customers but also to communicate our offerings to existing customers and the general public. We also maintained our digital presence through our company website and social networking channels, highlighting our businesses’ offerings and corporate initiatives. We maintain open communication channels, ensuring our delivery of excellent customer service.

The transformers produced by our energy solutions segment, First Philec, gained international traction, enabling them to penetrate the US market. They continue to adapt to market requirements while staying true to their brand promise of product availability and the fastest turnaround time. 

Various programs to improve the locators’ experience were initiated by our industrial real estate company, FPIP. Aligned with our thrust in digitalization, we have set up the FPIP Locator Portal and FPIP Access Management (FAM). Through the portal, locators can access information on their properties and conduct park-related administrative transactions remotely. The FAM is intended to improve the security of the park by setting up access card terminals for locator employees. Additionally, FPIP has communication campaigns to cascade and embed our mission to their locators. Locators are also encouraged to participate in and support FPIP’s CSR initiatives. 

Our energy segment continues to provide value-adding services (VAS) to its consumers. They collaborated with PiEnergy in offering a remote energy monitoring system (REMS). This monitors the energy parameters of a customer’s facility, such as fluctuations, consumption, and power quality. Through the PowerEd Learning sessions, our consumers are capacitated on topics such as understanding renewable energy, energy management systems, and those related to our mission of decarbonization and regeneration. Power plant tours were offered to existing consumers, allowing them to gain interest and affinity for clean and renewable energy. We participate in trade shows and roadshows to present our energy portfolio, products, and solutions to potential customers.

Collaborating with our Suppliers for a Shared Purpose

Through our co-creation efforts with our vendors, suppliers, and contractors, we can provide the highest quality of offerings to our consumers. As one of our key partners in value creation, we ensure that they meet our business requirements while empowering them to adopt responsible business practices. 

We released the FPH Code for Responsible Sourcing in 2022. This details our commitment to enjoining our suppliers in attaining a decarbonized and regenerative future for all. For our head office and power generation segment, an ESG questionnaire was disseminated to suppliers to gather insights on their current practices and alignment with our mission. With their varying maturity in ESG and sustainability, the FPH Corporate Sustainability Group held online Suppliers’ Assemblies to communicate our mission and its applicability to their businesses. The session was attended by tier 1 suppliers, vendors, and contractors from the FPH Group, covering a significant percentage of our business units’ top suppliers. 

Subsequently, our subsidiaries conducted targeted sessions to cascade and embed the essence of our mission with their respective suppliers.

First Philec held an in-person Supplier Conference in the first quarter of 2023. This served as a platform to discuss First Philec’s sustainability initiatives with partners. Furthermore, Philec incorporated elements of the Code for Responsible Sourcing in its procurement policy. These initiatives amplify their ambitions to utilize low-carbon materials for their products’ packaging and integrate emerging decarbonization technologies into their product pipeline, ultimately reducing their GHG emissions.

First Balfour, conducted a Vendors‘ Forum at the tail end of 2023. The session was held simultaneously in-person and online to accommodate First Balfour’s local and international suppliers. The session served as an avenue to work with our suppliers in forming viable strategies to implement our mission. Selected partners also shared their sustainability-related insights and initiatives. In line with the Vendor’s Code of First Balfour, accredited vendors are required to submit a Sustainability Compliance Form to attest their support to Balfour’s mission-related endeavors. 

Sowing the Seeds to Amplify Decarbonization and Regeneration Efforts

In line with our mission of forging collaborative pathways for decarbonization and regeneration, the FPH Climate Advocacy Program had several achievements in 2023. During the year, we found additional allies in our mission. We engaged 2,559 individuals in 20 activities across five sectors. Details on our external engagement is detailed in Annex 3 found on page 214.

In addition to our engagement with our suppliers and our membership in Net Zero Carbon Alliance to amplify climate action, we partnered with DENR and a civil society movement “Ako ang Bukas” (“I am the Future”) in 2022 and 2021, respectively. As an active participant of both groups,  strategic outputs were delivered in 2023 that set the templates for climate action. Both initiatives adopt a whole-of-society approach to contribute to climate resilience and GHG mitigation.

TRANSFORM (Transdisciplinary Approach for Resilience and Environmental Sustainability Through Multi-Stakeholder Engagement)

Ako ang Bukas Movement

The Ako ang Bukas Movement (AAB) is a multisectoral environmental initiative whose campaign, “Quantum Leap NOW: Climate Neutrality 2050” was convened in 2021 by Green Convergence, an environmental education organization for more than 30 years. The campaign calls for a whole-of-nation approach, involving all levels of society from the youth, academe, faith-based groups, LGUs, civil society organizations, business, and Indigenous Peoples. It involves taking stock of contributions to solving the climate change problem in terms of our greenhouse gas emissions, avoidance, and drawdown. FPH is an active member of AAB’s technical, LGU, and business task forces. In 2023, AAB partnered with FPH to develop the template for community GHG Accounting for the TRANSFORM Ormoc. In June 2023, the DENR entered into a Memorandum of Agreement with AAB to replicate the project in all its TRANSFORM areas nationwide. The TRANSFORM Ormoc project will be completed by March 2024 except for the nature-based solutions pilot project.

Working with our Communities for a Shared Value

Alongside being environmental stewards, our businesses are entrusted to empower all of our host communities. Our environment and biodiversity initiatives are detailed in the Natural Capital section, found on page 137. We maintained our social development programs to address the needs of our host communities and ensure their self-reliance.
 
Corporate Social Responsibility (CSR) teams are deployed within the areas of our operations. Through them and our local operations team, we regularly engage with our host and local communities to ensure the smooth implementation of our environmental and social development programs. These are done in the form of regular community dialogues, focused group discussions, maintaining an open communication line with our community members, and installation of grievance redress mechanisms to address their concerns. Our power generation segment is compliant with national regulations on benefits sharing with communities that host our power plants. Creating meaningful engagements with our host and local communities allows us to acquire a social license to operate in various parts of the country.

Sustainable LivelihoodS

Promoting social enterprises and sustainable livelihoods ultimately supports our partner communities and ensures their self-reliance. EDC-supported community organizations generated around PHP11 million in net revenues from livelihood projects and community contracts. Subsequently, they are supporting three long-term social enterprise projects that collectively benefit an estimated 2,000 households across their project sites.
 
Consistent with its strategic objective of being an employment hub in southern Luzon, FPIP held the SulongBuhay Job Fair to connect 39 of their locators with job-seekers. Thousands participated in the activity, with 784 job-seekers hired on the spot and 2,447 job-seekers being short-listed as potential talents for locators.

Disaster Risk Reduction and Management

In the climate-changed world, we are poised to capacitate our partner communities in strengthening their respective disaster risk reduction and management (DRRM) measures. Through these, we prepare them in times of natural catastrophes and man-made disasters.
 
EDC supported the local government of Burgos, Ilocos Norte by conducting a Rope Rescue and Flood Rescue Training for the LGU’s DRMM officers. This will help build the knowledge and skills of the participants in Rope Rescue and apply rescue techniques in flood and swift water incidents. To support Ormoc’s climate resilience program, they deployed a robust and easy-to-operate water filtration system in partnership with water solutions provider Power 4 All. Capable of producing up to 3,000 liters per hour of clean potable water, the water filtration system addresses a critical need and serves as a proactive solution to address the recurring challenges posed by floods, landslides, and deforestation.
 
FPIP capacitated 123 volunteers from various barangays in Batangas to properly respond to disasters and calamities. Furthermore, they co-established barangay DRRM protocols and processes, familiarizing volunteers with disaster response equipment, skills, and procedures.

Uplifting the lives of our Indigenous Communities

Watts Next? – Empowering Lopez Group employees to Regenerate Island Life

FP Island, First Gen, and FPH held an ideation competition entitled “Watts Next? Regenerative Solutions for Island Life.” Participated by employees within the Lopez Group, the competition solicited project proposals that will foster regenerative growth in the island communities of Caramoan and Garchitorena in Camarines Sur. Entries were judged based on socio-economic impact, innovation, and climate responsiveness.
 
Participating teams were mentored by experts from FPH, First Gen, EDC, and external partners to ensure the feasibility of the proposals. These external partners include the New Energy Nexus and the Department of Science and Technology’s Philippine Council for Agriculture, Aquatic and Natural Resources Research and Development (DOST-PCAARRD).
 
The submitted proposals underwent a rigorous evaluation process and were then presented to a panel. The panelists consist of leaders with profound experiences in strategic planning, business development, sustainability, and climate science. Out of the numerous proposals, only three (3) project proposals were selected for the development stage. This entails a field visit to our partner communities, resource planning, prototyping, and project execution. The winning teams focused on empowering the members of the island communities through social enterprises, incorporating elements of innovation, climate resilience, and economic viability.

Updates on our Foundation’s Activities

Lopez Group Foundation Inc.

The Lopez Group Foundation Inc. (LGFI) harmonizes and synergizes the corporate social responsibility (CSR) efforts of the FPH group and other affiliated companies. Through these collaborative efforts, we capitalize on and maximize the advocacies and expertise brought by these companies to continuously deliver exponential value to our stakeholders.
 
Despite the varying nature of the businesses under the Lopez Group, LGFI has identified seven advocacy clusters on which it can maximize its impact on community members. These are Environment, Education, Child’s Rights and Development, Humanitarian Action, Social Entrepreneurship & Sustainability Livelihood, Health & Wellness, and Arts & Culture.
 
Piloted in 2021, LGFI continues to support Lobo, Batangas through its Integrated Area Development (IAD) program. We focused on four clusters, as these programs are geared towards enabling our partner communities to be self-reliant. These initiatives were not solely implemented by LGFI, as various partners from the private sector and local and national governments poured their support into the success of these activities.

Oscar M. Lopez Center

Ang Misyon Inc.

Ang Misyon Inc. is a non-profit organization that supports the musically talented, less privileged youth. They believe that social change is sparked through the learning of orchestral music. Their flagship music program and main performing arm is the Orchestra of the Filipino Youth (OFY). Under the guidance of professional mentors, the OFY curriculum is specifically curated for a high-quality youth orchestra.
 
OFY regularly held rehearsals to continuously hone and master their musical instrument skills. They held the OFY Music Camp, a four-day intensive, camp-style format where the scholars get to commune with peers and learn challenging pieces together. It engages them to interact with their peers not only by socialization but also through sectional workshops and full orchestra rehearsals. This year’s camp featured two experts in the industry to share their knowledge with OFY scholars: Juan Sebastian Castillo Diaz, who did a Viola Master Class; and Jonathan Manalo, who held a Songwriting Workshop. The Repertoire for their Culminating Concert included Copland Fanfare for the Common Man, Mozart’s Overture to the Magic Flute, and Beethoven Symphony No. 7.
 
Aside from recitals, the OFY professed their musical talents through the following shows:

Solar Sikat Challenge Foundation

Sikat Solar Challenge Foundation, Inc., or SIKAT, is a non-profit organization that aims to uplift the lives of rural communities through electrification. Aligned with decarbonization and regeneration, SIKAT carries out their projects by installing renewable energy systems and nano grids, powered by solar, in their supported communities.
 
The Liwanag sa Sitio Program brought solar-powered generators to off-grid mountain communities in Mindoro. Using these systems, community members can power communication devices, power banks, and small rechargeable lights. Through electrification, we improve their access to communication and expand sustainable livelihood opportunities to community members. These communal assets are turned over under a conditional agreement but are closely monitored by our partners, Keep Hope Alive (KHA), regularly.  The Kaibigang Araw Program, initially sponsored by the UK Aid Fund, supports the electrification of livelihood activities in a community from Victoria, Mindoro. Through the installed solar-powered systems, community members can maintain beekeeping and honey production activities. Similarly, these support the production of woven products, such as baskets, bags, wallets, and home decorations.
 
To further support their livelihood activities, SIKAT and KHA launched the Mangyari Project, cataloging handicrafts and other local products from our partner indigenous communities, the Mangyan. This was launched internally to employees, assisting our partners to better market their products.
 
In collaboration with Solar Hope, SIKAT-UGNAY installed a nano grid system in an off-grid elementary school in Tanay, Rizal. Engineers from FP Island, an FPH enterprise, designed the school’s nano grid system.