A commitment to Social Responsibility Social issues permeates almost all aspects of business.

How a corporation manages such issues has much to with how seriously it takes it social responsibility to heart. Today, it is not enough to claim leadership as a profitable business. Good companies are also good citizens and proactively assist communities where they do business. The San Miguel Groups corporate citizenship goes beyond its commitment to its consumers, employees, and key stakeholders in government and the communities where it operates. San Miguel Corporation (San Miguel) is the Philippines largest food and packaging company. It was established in 1890 as a single-product brewery. Today, the company has over 100 facilities in the Philippines, Southeast Asia, and China. For generations, the Company has generated strong consumer loyalty through brands that are among the most formidable in the Philippine food and beverage industry San Miguel Pale Pilsen, Ginebra, Monterey, Magnolia, and Purefoods. In addition to their leadership in the Philippine food and beverage industry, San Miguel established a significant presence overseas. The companys operations extend beyond its home base of the Philippines to China, Vietnam, Indonesia, Malaysia, Thailand, and Australia. Through strategic partnerships it has forged with major international companies, San Miguel has gained access to managerial expertise, international practices and advance technology, thereby enhancing its performance and establishing itself as a world-class company. The company has significantly expanded its participation in both its core businesses of food, beverage and packaging, as well as heavy industries including power and other utilities, mining, energy, tollways, and airports. San Miguels goal is to help people enjoy and make progress in their lives through the many products and the services their company offers. We want to give every costumer and consumer we touch access to the best we can offer, - weather in terms of quality, or affordability, or choice. Said by Eduardo M. Cojuangco Jr; chairperson. San Miguel indeed is a company of people who care-about people and the communities they serve and partner with, as well as the businesses they manage. In the business milieu, social responsibility is becoming an important investment factor. Better access to capital is often granted to corporations with a strong social responsibility performance. It also puts these firms in a position to attract strategic partners, paving the way to gaining higher investments returns. Corporate governance and social responsibility directions have dovetailed in recent years. More shareholders view how corporations manage social responsibility concerns with growing confidence. This stresses the vital role of the Board of Directors in management in effectively institutionalizing social responsibility. There is a visible manifestation of social responsibility in the corporate governance policies and practices of San Miguel Corporation. San Miguel Corp. provides Audit Committee that ensures the accounting and auditing processes, practices, and methodologies meet international standards. It develops a definitive timetable within which the accounting system of the Corporation is 100% compliant with the International Accounting Standards (IAS). It includes an accountability statement to identify specific officers and personnel who are directly responsible for accomplishing such task. Financial records conform to accounting principles generally accepted in the Philippines. Upon its approval, the Corporation will adopt IAS as its main accounting and financial reporting platform for international acceptability. The Audit Committee promotes a transparent financial management system strengthen the integrity of internal controls within the Corporation. The Corporation established an

Investor Relations Unit to disseminate timely information to shareholders. SMC practices consistency, accuracy and timeless in the delivery and communication of information and data. The unit coordinates with the Compliance Officer and other SMC divisions in effectively communicating with stakeholders. San Miguel has had indeed a long-standing commitment to good corporate governance practices and taking a leadership role in instituting and maintaining practices that represent strong business ethics. These practices provide an important framework within which the Board of Directors can pursue the strategic objectives of the Company and ensure its long-term vitality for the benefit of stockholders. Indeed with the cooperation of stockholders, the San Miguel will not be a successful corporation right now. A corporation will always be a corporation, a one cannot live alone, business is about interacting with people, gaining profit and make your business sustain. Stockholders

Quality Management is focused on continuous improvement and enhances costumer relations. The culture of quality has permeated the San Miguel organization for more than four decades now. Total quality management (TQM) is a business philosophy related to an organizations management system that leads to a stronger competitive position, increase productivity and improved customer satisfaction. TQM started in San Miguel in the 60s with emphasis on productivity improvement. Two decades later, it evolved to focus on product quality and people involvement. This emphasized the need for a quality mindset for all employees and for them to be involved in ensuring high-quality products and services that delight and secure the loyalty of their customers. From the 90s up to the present, SMC have adopted TQM as a management system, underscoring the linkages of the various aspect of doing business, like leadership, planning, process and information management, human resources and customer focus to deliver desired business results. San Miguel Corporation re affirms its responsibility to its customers. Advancements in information technology make it possible for the corporation to establish a more personal communication link with its customers. The integrated SMC Customer Care Center provides alternative channels for easy access and fast response to varying types of customer needs and request. The Center supports SMCs business in strengthening customer relations and in directly market share as well. It is manned by a professional staff using superior technology and employing innovative solutions to ensure customer satisfaction and capture product loyalty. Walk-in customers who may prefer face-to-face interaction feel welcome amidst the Centers warm atmosphere. The Centers integrated setup makes it easy for SMCs operating divisions to link up with it for their customer and product concerns. By doing such quality management for the customers, there is no doubt why San Miguel Corporation is still the no. 1 or if not the no. 2 in their respective categories. San Miguel Corporations social responsibility commitment contributes to better employee retention, resulting in a considerable reduction in turn over and training cost. Employees normally remain working with the corporation because of their feeling that SMCs cares. Employee programs that help reduce absenteeism actually save the Corporation money as they encourage increase productivity. On the home front, programs that address employee welfare still a sense of pride in the people for being part of the San Miguel Group. The Corporation also provides program for the employees relation; the Sports and Recreation, this program aims to nurture camaraderie and unity among the employees through various activities, such as baseball, aerobics, and etc. Summer outing, songfest, baratillo,

Christmas Tiangge, there are no more dull moments for the employees! The Corporation also ensures that its employees work in a healthy and safe environment. The health of every employee is a main concern. SMC has an in-house clinic at the Head Office Complex to take care of employees medical needs. There are these benefits programs like; Employee Protection, employees are entitled to sick leave benefits that will provide financial security and even if they have lost the ability to earn in times of sickness and injury. The off with pay, employees are also entitled to leave benefits that will allow for the continuity of their wage earnings even if they are on vacation or have attend to emergency matters requiring their presence. To be continued.. The Government provides laws and obligation for the corporation and its Indeed, without the customer, the investors, the government and other businesses, the San Miguel Corporation will not be the n