Lala Rimando

Jose Cuisia is among the few to have formed a friendship with the tycoon Henry Sy Sr, once the country’s richest until his passing in January 2019.

After 27 years, Cuisia bows out as independent director of SM Prime, the property giant of the Sy family.

“I cherish most the deep friendship, which I developed with Mr Henry Sy Sr, endearingly called ‘Tatang’,” Cuisia said in during the April 20, 2021 virtual stockholders’ meeting of SM Prime. “His memory would forever be etched in my heart because of his business acumen, incredible work ethic, clarity of vision, simplicity, humility and compassion for the poor, which inspire beyond words.”

Cuisia, a former Philippine Ambassador to the United States and former vice chair of Philam Life, reminisced that it was Sy Sr himself who personally “invited me to join the board of SM Prime in 1994,” the year it listed in the Philippine Stock Exchange, and the year after he stepped down as central bank governor.

From spending almost three decades with the different generations of the Sy family, he emphasises that “Tatang’s legacy lives on in his children who are decisive leaders, promote value-driven management, and espouse pragmatic, stick-to-the-knitting, stay-with-the-business-you-know philosophy.”

Watch the rest of Cuisia’s speech here:

The Sy family, whose wealth was spawned from a shoe store, the first airconditioned outlet in 1958 Manila, has grown its business portfolio to include the Philippines’ largest chain of malls, residential and office projects, convention centres, hotels (all under SM Prime), as well as the largest bank in the country (BDO).

SM Prime is now chaired by Henry Sy Jr, the founder’s namesake and eldest son. Sy Jr and his five siblings are in different boards of the SM group, both in listed and non-listed firms. They have one of the smoothest transitions of business responsibilities and generational wealth in the Philippines.

In 2020, the property business accounted for 33% of the listed holding firm SM Investment’s net income, while retail business and the banking assets contributed 12% and 55%.

SM Prime was the first of the Sy family’s businesses to be listed, allowing outsiders to own a piece of the company, which in 1994 only had four malls generating about P26 billion revenues and P1 billion in net income from assets worth P4 billion.

Growth since then has been no less than “phenomenal” as Cusia describes.

“By 2019 — that’s the year before the pandemic hit — the company’s revenue has grown 51 times larger to an astonishing amount of P116 billion; P38 billion in net income or 38 times, and P667 billion or 43 times in terms of total assets.” 

Then the pandemic hit.

Work-from-home orders and quarantine restrictions dramatically ended the almost yearly double-digit growth rates enjoyed by the SM Prime out of its over 70 malls in the Philippines and 7 in China. Revenues and income in 2020 were mercilessly cut by 31% and 53%, respectively.

“2020 was a devastating year for business and economy,” Cuisia aptly notes.

However, “it also illuminated our organization’s true character of genuine concern for employees and all stakeholders whose safety and well-being overrode profit considerations. Then and not the SM group generously assists many needy Filipinos and communities. And when we have the head for business as well as the heart for people…I’m certain SM Prime’s and parallel growth and profitability will scale even greater heights.”

Cuisia’s departure from SM Prime board follows a recent SEC ruling that independent directors can only serve a cumulative nine years.

Another former central bank governor, Amando Tetangco Jr, joins the SM Prime board as independent director. He and ex Pag-IBIG Fund chief Darlene Berberabe and ex SGV chair Carlitos ‘Itos’ Cruz will take over board posts vacated by Jose Cuisia, Joselito Sibayan, and Gregorio Kilayco.