I recently ordered several cupboards for a kitchenette to replace some old ones, finally contracting a particular company because I liked their design and they also offered the shortest delivery date—in my case, thirty days upon down payment of fifty per cent. To make sure production was proceeding smoothly, and also wary of the Filipino propensity to procrastinate, I called their sales office for an update after two weeks. I was told my order had not yet been forwarded to the production unit because the measurements were not yet complete. When I asked if the installation would be done as scheduled, I was told that the count of thirty days would start only when the scaled drawings were complete. How come that wasn’t mentioned in the contract? It only stated delivery and installation within thirty days after fifty per cent deposit? When might the new schedule be? Pasensiya na po (so sorry) but their technical people were busy and they didn’t quite yet know just when they could assure me the installation. Then, because I was obviously upset, they made me a new, rough design. The sales staff were surprised I wasn’t pleased by their effort to be considerate. After all, they were providing me with a “new, improved” design at the same cost. Likewise, friends couldn’t see why I should be so annoyed. So what if instead of thirty days, delivery would come sixty or ninety days hence? I was consequently advised to throw away my watch and my calendar and to relax. Bahala na. Go with the flow. Perhaps, I thought, this is why I find the Filipinos to be always charming and cheerful.
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Increasingly, large family corporations are employing trained professional managers. Still, it is often only members of the family whom the entrepreneur feels they can truly trust, as their systems of control are weak. Family members thus remain the entrepreneur’s confidants and retain high positions within the company—treasurers, in particular. Further, the family forms the kitchen cabinet, playing key roles in the entrepreneur’s cordon sanitaire.
On my first return to the Philippines in 1976, I worked for the Philippine government. One of my initial projects was developing teaching materials for pre-school children. My academic training had made me think I had the skills for the job. It also fitted with my dream of working for the Children’s Television Workshop in New York City. Coincidentally, after I left government service, my office did launch a TV series called Batibot, patterned after Sesame Street. Years later, I heard that when the programme was at its planning stage, I was still at my old job, and my name was the first one mentioned, but my reputation had preceded me. I was widely regarded as too “professional”, i.e. seen as competent but lacking in personal loyalties. It was feared that the functionaries who were responsible for the show would not be able to control me. As a consequence, whilst the teaching materials my staff and I had already developed were turned over to the new project team, I was never invited to join them.
Expansion of Family Businesses
Family corporations can function well enough, because when the business becomes too unwieldy, the entrepreneur can simply spin off activities to form a new firm, with these new fully owned subsidiaries tied together through a holding company. SM Prime Holding Inc., for example, is a holding company owned by the Sy family, and under this holding company, there are numerous other corporations scattered across different sectors: real estate, banking, agricultural lands, merchandising, etc. Expansion is done horizontally across sectors rather than vertically within the same sector because of vertical growth’s attendant problems of bureaucratisation. Growth is therefore opportunistic rather than strategic.
In most cases, the process of expansion is similar. One sibling could be CEO of one company, and if the company is large, under him would be the professional managers. Another sibling would run the next company, and so on. Together, these siblings would form the members of the management committee of the holding company. The patriarch himself would sit as chairman. This method is one way of keeping the structures simple and more flexible. One downside to this is that the family is forever in a steep learning curve, instead of making use of the expertise they have already gained on one industry. On the other hand, an upside is that decision-making, based on “gut-feel” is quick, thereby allowing the organisation to grab fleeting opportunities. Environmental scanning is a process reached through immersion and serendipity rather than through focused data gathering. I had once heard that a big building in Hong Kong was on offer at a very attractive price. A multinational company got hold of the information very early but had to defer the decision-making to the head office. Meanwhile, a Chinese taipan heard about the news while on board a plane, and bought the building the moment he landed back in Hong Kong.
Even in my own family business, certainly nowhere near as big as some of the big family corporations in the country, the same rule of thumb operated. My family was not only into sugarcane growing, but also into alcohol-production, lime mining and quarrying, fishpond operations, real estate development, together with my mother’s cinema and her forays into trading. My parents, as well as my siblings were members of the board and management committees not only of the holding company, but also of the subsidiary corporations. That I was left out was because I was not in the country for many of those years and was thought of as not able to contribute to the business.
This type of management is all possible until the patriarch must cede control because of old age, illness, or death. The problem of succession then sets in when business management competence becomes even more important, and pressure builds to professionalise the running of the enterprises. Quite often, the patriarch, no matter the pressures of age or illness, never cedes control (or their perception of it) until death. Since writing wills is not a common practice in the Philippines, the issue of inheritance is perhaps the family’s most pronounced crucible.
Issues of Family Inheritance
Inheritance issues are arguably the biggest cause behind the disintegration of relationships within families, especially for those who are asset-rich. Inheritance laws are unambiguous in the Philippines: the surviving spouse, after having taken their share from the conjugal assets, takes another half of the inherited assets, and the children from the marriage divide the rest equally amongst themselves. Hence, it is on the death of the surviving parent that the crisis really starts. Laws are easily circumvented. By default or design, financial management is very opaque, with family members in management positions having the most access to family resources, often to the detriment of other members who effectively become a “rubber stamp” board. Initially, this does not cause any friction because of the respect accorded to the parents. When they are no longer there, however, the surviving members must form alliances amongst themselves and intra-family politics intensify—Who gets what? How much? When? The person who controls information, and/or is in physical possession of the assets, or of legal documents, has the most power.
A friend once surprised me when she commented that her father had died (her mother having passed years earlier), and that she had decided to sell their ancestral home and share the proceeds with her younger sister and the sister’s family. Her brother, then in America with his own family, complained that he too wanted his share of the proceeds. She was ignoring him—assuming that, as a professional in America, he didn’t need the money. I don’t know the legal details but what amazed me was her complete sense of righteousness. “But are you being fair?” I remember asking. She reasoned that her brother was well-off whilst her sister needed the money more. “How do you know,” I asked, “and shouldn’t that be up to your brother to decide whether or not to give his share to his sister? Why don’t you appeal to his own affection for his sister and his sense of generosity?” No, she didn’t trust him; he was greedy. Why else was he complaining? “Perhaps, it’s because he wants to be free to exercise his own rights,” I tried to explain.
I learned a couple of things from this single exchange: one was that satisfying perceived needs was more important than the exercise of fairness. This is, of course, true in all collecti
vistic societies. The ideologies of socialism and communism are themselves more concerned with perceived needs than with fairness. Fairness comes low in the hierarchy of social justice. Part of the problem in the Philippines is that perceptions of need amongst family members can be easily manipulated, and happen quite often. In my example, my friend had assumed that because her brother was living in America, earning in US dollars, he was better off than those in the Philippines who owned their own businesses. Also, her sister had more children who had their own requirements, including having well off friends with standards to which they had to live up to in order to be accepted.
In consequence, earning your own keep is often not appreciated if benefits are not shared by the other members of the family. It is for this reason that those who think they have earned what they now possess sometimes resent their more “needy” relations’ sense of entitlement.
At the extreme end of individualism is of course the complete disregard for the needs of others, i.e. capitalism without a soul. What I hope I am pointing out in these examples is that in the Philippines, the dichotomy between the two is played out at the family level. Further, it is reflected in the various members’ shares in the family business.
Naturally important is the legitimacy of the decision-maker. Did my friend have legitimate authority? Or was she simply being opportunistic as well, due to the twin facts that she was in possession of the deed of the property, and that her sister’s family lived in the house? A similar case of this kind of opportunism was another story I heard. The family matriarch had just died. After the funeral, the surviving members looked for their mother’s valuable jewellery—apparently kept in a safe deposit box in the bank—with her three daughters holding on to the keys. They had disappeared and no one knew who had taken them. An oft-repeated tale, it is of no small wonder that many families end up in court fighting each other. One particularly extreme case was of one brother whom he believed had robbed him of his rightful inheritance. In this manner, close family ties nurtured over the years become irretrievably unbound.
Oftentimes, it is in fact in opportunism that corruption starts.
The Essence of Politics
The essence of politics is power, and how power is leveraged and used. In a democratic society, power and politics are used—ideally—towards serving the interests and welfare of the citizenry. It is said that Filipinos are obsessed with power, and hence with politics. The highest accolades in Philippine society are often given to politicians and high-ranking government officials. They are in the headlines of the news every day—household names often reputed to have lots of money. After all, a person needs a lot of money in order to run for office, and whilst in office, has the most opportunity to make money. Even if they don’t necessarily desire great wealth, it is unfortunately a precondition for achieving and holding on to power. Hence, the common saying among politicians, “Make hay whilst the sun is out,” as you will need plenty of money come election time. As mentioned earlier, unlike, say, in the US, the Philippines does not have any implementable laws regarding the sourcing and use of funds in electioneering.
With politicians occupying the highest positions in the group hierarchy, the greatest deference is accorded to them, even though they might not be necessarily admired. In their absence, they can be the object of much gossip as many are reputed to be corrupt, murderous, and/or adulterous. Everyday conversations are geared towards the latest political scandals. Yet, given the opportunity, many of the ambitious gossipers would themselves want to become politicians or high ranking officials as they feel these are the most direct routes to success. Psychologically, the imbalances in perceptions of everyday reality on the one hand, and the nation’s religiosity that emphasises the virtues of honesty and truthfulness on the other, give a sense of a world that is out of kilter. People see rewards being given to those who in general do not practise these virtues.
As with many locally prominent families, my extended family found their passion in politics. This included my mother. My father had thought politics was a “dirty” business and my mother was inclined to agree with the judgment of my father, whom she thought was prudent and sensible. After his death, however, my mother was drawn into the political world of her siblings. One of the youngest uncles—the most financially unstable in the family—was enjoined to run for office allegedly in order to give him a certain status in the community. In truth, he was also needed to become the medium by which the family could gain and keep political power. An older brother and sister lent their financial backing, and each uncle identified and campaigned in his own bailiwick. The younger brother eventually became mayor and later brought into politics with him, first my mother, then his nephews. Now, the Palanca family is known to be a political dynasty in our town-turned-city.
My mother was eighty-one years old when she decided to pick up the baton by running for mayor after her younger brother had served two consecutive terms and was no longer allowed by the Philippine constitution to run for re-election. The family slogan was, “You don’t give away what is already yours.” When she handily won the election, she broke the record of having been the oldest elected first-term mayor in Philippine history. She truly had the welfare of Victorias at heart as she was genuinely emotionally attached to the town: for example, keeping the community clean, enhancing peace and order, and continuing her healthcare programme, which she started even before she became mayor. Close to her heart was the pakain, a feeding programme for poor children. Under her stewardship, the town won the Most Beautiful Plaza Award in the province. When escorting out-of-town guests, her great pride was the town plaza and its beautiful garden, modelled after the English ones that she had seen.
People from neighbouring areas would go see Victorias’ Christmas decorations, up already in October, and attend events in the plaza: a fashion show, a ballet dance, a songfest— all gratis. The performers were her grandchildren and their friends imported from Manila. For those who had previously not witnessed such “high culture” spectacles, they were a broadening experience, and gave the townspeople great pride in their community. Perhaps one could have argued that Victorias more urgently needed improvements in infrastructure—water supply, for instance, was inadequate and not evenly distributed. But as my father was no longer there to guide her, my mother did the best she could. Unfortunately, she only agreed to keep the seat warm for her younger brother and he took the post back at the next election when the Philippine constitution allowed him to run again. This was a big loss to my mother and to the community.
My uncle had pet projects of his own, including a gigantic arena for his hobby sabungan (cockfighting). After he left, his successor wisely turned it into a sports complex. For good or ill, the mayorship in Victorias remains in the Palanca family dynasty to this day—with the seat of mayor now occupied by a nephew.
Especially to the Filipinos with their overlapping use of space, there is moreover a fudging of locations for political activities. Absent is the English regard for their homes—the concept of their home as their castle. I recall that there were often people at our house in the early mornings waiting for my mother, not only before she had left the house but before she had even woken up! Depending on their perceived importance, they could be invited to have breakfast with us. (One must be careful that the power distance is not too great or the subordinate will feel extremely ill at ease.) I used to resent these unsolicited arrivals, but I seemed to be the only one who felt that my private space was being violated. Indeed in a collectivistic society, privacy is in short supply, and therefore a luxury for somebody who values it. These experiences were not by any means unique, but rather representative of how politics is practised in the Philippines.
When I first heard of high fashion being shown in the plaza of a town where many of the residents lived below the poverty line, I was aghast. Would people not resent it? Ironically, the public instead identified with the “sophistication” of Victorias, and took
vicarious pride in it.
I now wonder if the political leanings of many Filipinos are to the right. We often read about “rightists” and “leftists” and the different gradations between them. “Leftists” believe in egalitarianism, and want to eradicate social inequality. “Rightists” find the eradication of social inequality to be a utopian objective, believing instead that socio-economic inequality belongs to the natural order of things. Rightists value tradition and social stratification. In a hierarchical society such as the Philippines, with each one knowing their own place, I can guess that many would identify themselves with the right. Thus, Imelda Marcos herself, when criticised for her opulence, retorted that she simply wanted to look good for the Filipino people, so that through her, they could take vicarious pride in their country. Who knows, she might have been correct.
Corruption
As I have written above, I bought a weekend cottage not too long ago. I thought it would be a simple enough process as the seller and I easily came to terms. When I tried to change the title to my name, however, I was told that because I was married—and especially because I was the wife and my husband was the legal administrator of the conjugal assets—I needed marital consent. So I called my husband who lived in Germany. He faxed me his consent but it was sent back by the Registry of Deeds. It had to be in the original. My husband then sent his original letter by courier. Again it was returned; it needed to be notarised. My patient husband asked a local notary to certify the document and then resent it to me. When I called him next, I was in tears. No, it should be certified not just by any notary but by the Philippine Embassy. He exploded. Why didn’t they say so in the first place? After the toing and froing, he was not willing to fly to Berlin. As it turned out, any Philippine consulate would have been sufficient. Even so, Essen, where the nearest Philippine consulate was located, was some three hours away by car and the consulate was only open in the mornings so that he would have to stay in town overnight. He would then have to submit the documents in person. However, instead of simply waiting for them to be stamped, he would have to leave them there, picking them up after about a week. This, of course, was on the presumption there would be no glitches. Philippine government organisations have a notorious reputation for being extremely bureaucratic and inefficient. You would be informed of legal requirements, which more often than not be handed out piecemeal and perhaps even change depending on who you talk to. I therefore decided to drop my request for a change of name to the title, hoping that, when the time came, an Absolute Deed of Sale would suffice.
When Turtles Come Home Page 12
