The Ayala Corporation as a Global Corporation

The Ayala Corporation is one of the oldest and gargantuan conglomerates in the

Philippines having its establishment dating way back during the Spanish Colonial Rule

in the Philippines. The corporation was founded under the partnership of Domingo

Roxas and Antonio de Ayala in 1834, coinciding with Spain’s decision to open

international trade in the Philippines. The earliest iteration of the company can be traced

back to Casa Roxas which dabbled itself in agriculture and mining, manufacturing, and

trade. From the founding fathers, the reigns of managing and leading the corporation

has been continually been handed down to their children from one generation to the

other, with each generation tapping into different fields in business. It was in 1851

where the company now headed Jose Bonifacio took a great risk of buying a region of

land in Makati, which would come in handy eventually. The first private bank in the

Philippines and the ancestor of the Bank of the Philippine Islands, the El Banco

Español-Filipino de Isabela Segunda was established by the third generation of Ayalas:

Pedro Roxas and Jacobo Zargoniz. Under their leadership, they saw Casa Roxas

transform into the Ayala y Compania where its primary enterprise was that of banking

and public land transportation.

When the Great Depression struck the United States’ economy, this also affected

the Philippines to some extent. With the help of Joseph McMicking, the businesses that

were headed by Ayala was given salvation from the crisis from where the company

would establish a new path to follow. The land that Jose Bonifacio bought years ago

would later be developed, completely transforming the region into an organized city.

This would later on become the nesting place for all middle to upper-class citizens as
they steer towards a business focused on real eastate. The company would only begin

to take on a more corporate nature when Jaime Zobel de Ayala has stepped up to take

steer the direction of their family established business. A significant change in how the

businesses were managed quickly overhauled the then family-run company to become

a more professional corporation. In the present, now being one of the largest

conglomerates in the Philippines, it is now headed by Jaime’s sons Augusto and

Fernando Zobel de Ayala. From a simple business focused on farming and mining,

manufacturing and trade, the Ayala Corporation has their hands in various businesses

that directly influence the Filipino masses ranging from Globe Telecom. to Manila Water

and real estate among countless others.

Throughout its history, the Ayala Corporation has partnered, associated, and

rivalled different companies throughout the world. The earliest record that the Ayala

Corporation has set its foot on a global frontier was its organization of different Filipino-

owned insurance companies to which they would establish the first Filipino life-

insurance company: Insular Life Assurance Co. However during the early 20 th Century,

racial prejudices would prevent them from entering the global industry dominated by

foreign companies. They would later succeed in establishing a solid ground within this

industry. The conglomerate wasn’t entirely affected by the Martial Law because they

didn’t participate in any sort of politics. They would rather concern themselves with

protective measures that would allow themselves to form pacts with foreign groups. One

such group that caught their attention was four Mitsubishi Companies of which would

end up buying at least 20 percent of the stock that the company has. As of 1976, they

have foreign partners for each of the business activity that they are focused in. From the
J.P. Morgan Overseas Fargo Bank International partners in banking to the Japanese

Airlines Development Co. and Hong Kong and Shanghai Hotels in tourism, the

Corporation has proven itself to have the capabilities to become a global corporation. In

the present, the Ayala Corporation still strives to establish more ventures in other

countries. In 2017 they were able to acquire facilities for manufacturing in different

European and Asian countries like Germany, the United Kingdom, and Thailand to

name a few. For manufacturing they also has a joint venture with KTM, an Austrian

motorcycle based manufacturer and is considered as one of the largest in the world.

This is but to name a few of the too many to list ventures and partnerships that the

Ayalas have made over the past years. With more of their plans not yet fully realized,

we can expect that this Filipino owned-corporation wishes to maintain its status as a

global corporation.

Looking at the beginnings and development of the Ayala Corporation we can

observe most, if not all of the attributes that make up a global corporation. Two of those

attributes, however, are the defining qualities of what made the Ayala Corporation the

way it is successful today. First, they had to gain their economic prominence. While the

success story of the Ayala Corporation isn’t entirely a rags to riches cliché as the

founding fathers were educated and studied in prestigious universities of their time, their

business started small. They didn’t become global corporations overnight, they started

local. Their rise to prominence is a direct result of keeping true to their business

philosophies of reinvention and evolving themselves to suit the needs of the time period

that they find themselves in. With hard work, careful planning, and risk-taking over the

years, they were able to develop their family business into something more. With this
attribute, they were able to facilitate economic development. A good example of this

attribute was their success in transforming Hacienda Makati from being a marshland to

a city after the wake of World War II. They saw the havoc that had wreaked Manila as

their chance to be able to expand and rebuild the economy that was lost. Eventually,

Makati became a hotpot for both businesses and residences. Various infrastructures

such as subdivisions, office buildings, and other facilities for various purposes began to

appear in Makati and began revitalizing the broken economy. By then, the Ayala

Corporation had become the company’s most powerful and successful developer in real

estate in the Philippines.