In a conglomerate run by cousins, one 鈥榩rimo鈥� speaks power
Aboitiz Power Corp. president and CEO Danel Aboitiz —Contributed photo
MANILA, Philippines — A notable trait that can set the Aboitiz Group apart is its sheer longevity—which it owes to the successful, intergenerational management by cousins, rather than by siblings or father-and-son teams.
This makes it quite unique among the country’s enduring family-run conglomerates.
The reins are currently held by Aboitiz Equity Ventures (AEV) CEO Sabin Aboitiz, a member of the fourth generation who is focused on transforming the group into a “techglomerate,” where operations make full use of the latest technological innovations.
Helping Sabin achieve this goal is a growing echelon of nephews and nieces—the fifth generation—holding top positions across the group.
One of them is 43-year-old Danel Aboitiz, the only son of AEV chair Enrique Aboitiz and renowned painter Valeria Cavestany. Danel took over as president and CEO of Aboitiz Power Corp. on July 1 this year.
Article continues after this advertisementMuch is expected of Danel as his portfolio—consisting of 49 power generation facilities and nine electric distribution sites across the Philippines— accounts for the majority of the group’s total earnings.
Article continues after this advertisementAt the end of the first nine months of 2024, AEV, which also has interests in power, banking, property development, infrastructure and food, rang up a net income of P18.8 billion, up 4 percent from the P18 billion recorded in the same period last year.
And of that profit, AboitizPower accounted for 64 percent or P14.5 billion, a share that was also up by 4 percent from the previous year thanks to higher generation and additional supply from newly built solar power plants.
Years of experience
Danel’s decisions have an outsized impact on a conglomerate whose history traces back to the late 1800s.
But he has years of experience to guide him. Before taking over as CEO, Danel was the chief commercial and stakeholder engagement officer and the senior vice president of the Regulatory Affairs and External Relations at AboitizPower.
He also served as president and chief operating officer within the company’s coal and oil business units. He also significantly contributed to its geothermal business unit and the SN Aboitiz Power Group, the joint venture between Scatec of Norway and AboitizPower for large hydropower facilities in Luzon.
He earned a Master of Arts degree in Philosophy and Politics from the University of Edinburgh in Scotland, and also completed a year of study at the Beijing Language and Culture University.
Overseas expansion
As CEO, Danel, who was recruited to the group by his uncle and former AEV CEO Erramon Aboitiz, is determined to further grow its assets, which will include both traditional and renewable power plants.
At present, about 70 percent of AboitizPower’s output still comes from fossil fuel-fired plants, including those using coal. But the medium to long-term goal is to gradually increase the share of renewables as long as the price and reliability issues are addressed.
Danel is also an advocate of upstream natural gas and coal exploration, as he believes that securing indigenous sources will not only improve the country’s energy self-sufficiency but also provide a shield from global price fluctuations and foreign exchange risks.
But he also hopes to introduce another type of “derisking” to AboitizPower, one aiming for a scenario where the company would no longer depend most heavily on Philippine operations for its revenues. Plans are therefore in place to expand abroad.
“We are also looking to diversify away from coal, not to have an overreliance on just one technology. It does not mean we won’t build coal; it only means we will build other things faster,” Danel says.
Timeless values
As AboitizPower expands, Danel says, the company will continue to be guided by the “timeless” values of integrity, responsibility, teamwork, innovation and service excellence.
He defines integrity and responsibility as delivering on the group’s commitments and leaving things better than when they found them. These values, he says, provide AboitizPower with a strong foundation on its path toward achieving ambitious goals, which include having 4,600 megawatts of renewable capacity by 2030.
Teamwork, or the desire for genuine collaboration across units within and outside the company, is a competitive advantage at AboitizPower, Danel stresses. Coupled with innovation and creative thinking, this allows them to capture synergies and efficiencies, therefore making the collective greater than the sum of its parts.
Finally, and most importantly, service excellence, which Danel says is AboitizPower’s “reason for being.”
“We always have the customer in mind. We strive to operate like a competitive retail business rather than a monopolistic utility. We endeavor to understand the needs of our customers, and innovate to better respond to their needs.”
17 cousins
Putting the customer at the center of the business is a value that Danel shares with the rest of his cousins—and there are 17 of them, as of the last count, holding key posts across the organization.
They all trace their roots to Paulino Aboitiz, a Spaniard who established Aboitiz & Co. in the late 1800s as a trading business dealing in abaca and general merchandise in Ormoc, Leyte.
Also among the fifth-generation cousins managing the group are incoming Union Bank of the Philippines CEO Ana Aboitiz-Delgado, incoming Aboitiz Land Inc. CEO Rafael Fernandez de Mesa, and Pilmico Corp. CEO Tristan Aboitiz.
Danel believes that family members naturally take a much longer view of the business, having an intimate knowledge of its history and deeply mindful of the legacy they want to leave for those next in line.
But at the same time, this filial foundation of strength still needs to be fostered by a merit-based working environment, where professionals outside the generational circle can also thrive, grow as leaders in their own right, and help achieve the company’s mission.
