The official theme of the Philippine chairship, “Navigating Our Future, Together,” is well chosen. Its three priorities—Peace and Security Anchors, Prosperity Corridors, and People Empowerment—capture what ASEAN must become to remain relevant: not merely a diplomatic forum but a platform for practical regional action. ASEAN is home to nearly 700 million people and is the world’s fifth-largest economy, with aspirations to become the fourth-largest by 2030. That scale gives ASEAN weight, but scale alone will not produce influence. Influence must be earned through results.

For the Philippines, this chairship should be judged not by the number of meetings hosted, declarations issued, or photographs taken, but by whether ASEAN can move from aspiration to implementation. In my view, the central task is clear: turn peace, prosperity, and people empowerment into concrete outcomes that Southeast Asians can feel in their daily lives.

ASEAN’s value has never depended on becoming a Southeast Asian version of the European Union. That was never its design. Its strength lies in consultation, consensus, flexibility, and convening power. But these strengths must now be matched with a stronger bias toward execution. ASEAN centrality cannot simply be claimed; it must be demonstrated through relevance, credibility, and performance. That is also the thrust of the interview responses I recently prepared: ASEAN integration must become more practical, people-centered, and implementation-driven.

Peace and security anchors

The first priority—peace and security anchors—goes to the heart of ASEAN’s original purpose. Southeast Asia has prospered because, despite conflict and rivalry, the region has broadly preserved conditions for stability, commerce, and dialogue. Today, however, that stability is under greater stress. The South China Sea remains a persistent flashpoint. Myanmar continues to test ASEAN’s unity and credibility. Cyber threats, transnational crime, terrorism, natural disasters, and external conflicts increasingly affect the lives of ordinary citizens.

The recent ASEAN Summit in Cebu underscored this reality. Regional leaders had to address the economic consequences of the Middle East crisis, including risks to energy supplies, shipping routes, and the welfare of Southeast Asian nationals overseas. Reports noted ASEAN’s push to accelerate the development of a regional fuel-sharing framework and the Philippine proposal for an ASEAN maritime center, while also acknowledging the coordination challenges that still constrain regional action.

This is precisely why peace and security cannot remain abstract. ASEAN should use the Philippine chairship to strengthen crisis-response mechanisms, maritime cooperation, humanitarian coordination, and adherence to international law. The Philippines is well-positioned to underscore that regional peace must rest not on silence or avoidance, but on dialogue, restraint, rules, and practical cooperation. ASEAN need not speak with one voice on every issue, but it must be able to act credibly when regional stability is at stake.

Prosperity corridors

The second priority—prosperity corridors—is equally important. ASEAN integration should no longer be understood primarily in terms of tariff reductions or formal trade agreements. The next generation of integration will be built on logistics connectivity, digital trade, inter-operable payments, common standards, recognition of skills, energy cooperation, resilient supply chains, and sustainable industrial development.

I would emphasize that integration must be meaningful for firms, especially micro, small, and medium enterprises (MSMEs). A small business in Davao, Cebu, Penang, Surabaya, or Ho Chi Minh City should find it easier to sell, source, pay, deliver, innovate, and partner across ASEAN. Integration must reduce the practical frictions that keep our entrepreneurs from participating in regional value chains.

ASEAN has already recognized the urgency of this agenda. Its economic strategy calls for deeper integration, stronger supply chains, improved transport connectivity, energy security, freer movement of businesses and people, and improved regulatory practices. However, the same reports have also noted that implementation has often been slow because of wide differences in development levels, political systems, and institutional capacity among member states.

The Philippine chairship should therefore focus on a few key deliverables: faster trade facilitation, customs modernization, digitalization of cross-border processes, regional MSME platforms, supply chain resilience, and standards that help ASEAN firms meet global market requirements. Prosperity corridors should not be understood merely as infrastructure corridors. They should be corridors of trade, data, talent, finance, technology, and trust.

People empowerment

The third priority—people empowerment—may ultimately determine whether ASEAN integration gains public legitimacy. ASEAN cannot remain a project understood only by diplomats, officials, and economists. It must be felt by students, workers, professionals, consumers, farmers, fisherfolk, start-ups, and families alike.

I believe ASEAN’s future will depend heavily on human capital and knowledge networks. Student mobility, credit transfer, research collaboration, technical and vocational education, professional recognition, and digital skills development should be central to integration, not peripheral. A young Filipino, Vietnamese, Indonesian, Thai, or Timorese should see ASEAN not as an annual Summit but as a space of opportunity.

People empowerment also requires inclusion. ASEAN integration will be incomplete if it benefits only large corporations and capital cities. It must reach secondary cities, rural producers, women entrepreneurs, informal workers, and vulnerable communities. It must also support climate resilience, disaster preparedness, public health cooperation, and food security. In a region repeatedly exposed to typhoons, floods, droughts, pandemics, and commodity shocks, resilience is not a slogan. It is a development imperative.

Timor-Leste’s membership adds urgency to this point. Its accession affirms that ASEAN is not a closed club but a regional community grounded in geographic and historical logic. However, meaningful membership will require capacity-building, institutional support, regulatory alignment, and patient integration. Timor-Leste’s entry should remind ASEAN that integration is developmental: stronger members must help newer and less-developed members participate effectively. Reuters reported that Timor-Leste formally became ASEAN’s 11th member in October 2025 after a 14-year wait, with expectations of greater trade and investment opportunities.

To turn the Philippine chairship’s priorities into results, ASEAN must also improve its operations. Consensus should remain part of ASEAN’s political DNA because it reflects the diversity and sovereignty of its members. But consensus should not become an excuse for inaction. ASEAN should use flexible mechanisms—where appropriate—to allow willing members to move ahead in specific areas while others catch up. This is especially relevant to digital integration, the green industry, energy cooperation, skills mobility, and supply chain resilience.

ASEAN also needs sharper prioritization. It cannot pursue everything with equal urgency. The Philippine chairship should help ASEAN focus on a manageable set of high-impact initiatives, with clearer timelines, monitoring, and accountability. Declarations matter, but delivery matters more. The ASEAN Community Vision 2045 calls for a resilient, innovative, dynamic, and people-centered ASEAN and explicitly emphasizes timely and effective implementation. The Philippine chairship should serve as a bridge between that long-term vision and near-term action.

The Philippines has a particular stake in ASEAN’s success. We are an archipelagic nation, a maritime state, a major labor-sending country, an emerging manufacturing and services economy, and a democracy in a contested strategic environment. ASEAN is not an abstract foreign policy project for us. It is a platform for peace, trade, investment, education, innovation, resilience, and strategic autonomy.

The challenge is not to make ASEAN perfect. The challenge is to make ASEAN more useful. Its diversity, consensus culture, and limitations will remain. But ASEAN can still become more effective if it is guided by a practical question: what can we do together to make our peoples safer, more prosperous, and better able to shape their own futures?

That is why the Philippine chairship matters. It gives the Philippines an opportunity to help ASEAN move from process to performance, from centrality to credibility, and from declarations to delivery.

If the chairship succeeds, its legacy will be measured not only by communiqués but also by stronger mechanisms for peace, more resilient regional supply chains, deeper digital and economic connectivity, more empowered citizens, and a clearer sense that ASEAN belongs not only to governments but to its peoples.

The future of ASEAN will not be secured by rhetoric alone. It will be secured by implementation. For the Philippines, the task is to help ASEAN demonstrate that peace, prosperity, and people empowerment are not merely chairship priorities. They are the foundations of a region capable of navigating its future—together.

[The author is former President of the Management Association of the Philippines (¶¶ŇôłÔąĎ). He served as Secretary of Trade and Industry, and President of University of the Philippines (UP) System. Feedback at <map@map.org.ph> and <aepascual@gmail.com>.]

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The company was recognized for its human-centric approach to predictive AI, helping organizations anticipate employee attrition while improving workplace experiences and workforce management.

This year, the GTI Competition is once again looking for the next generation of technology innovators whose ideas and solutions have the potential to transform industries and create meaningful impact.

The GTI Competition in the Philippines will culminate at the 2nd ¶¶ŇôłÔąĎ x KPMG Technology Summit on June 30, 2026 at Shangri-La The Fort, where the winning teams will be recognized before an audience of business executives, policy-makers, technology leaders, and industry professionals. With the theme “AI at Scale: Driving Value with Governance and Security,” the Summit will explore how artificial intelligence (AI) continues to transform industries, governance, and the broader business landscape through discussions on AI adoption in the Philippines, AI governance and public policy, enterprise and sector applications including the BPO industry, and data governance and cybersecurity.

As AI becomes more deeply embedded across both public and private sector systems, it is reshaping how organizations design policies, manage risk, and deploy technology at scale. This shift underscores the growing need to align innovation with governance frameworks that ensure responsible use, protect data integrity, strengthen cybersecurity resilience, and support sustainable enterprise transformation across industries. At the same time, as organizations increasingly integrate AI into decision-making processes, trust, transparency, and accountability are becoming essential pillars alongside technological advancement.

The Philippines also continues to benefit from a young, digitally connected, and highly adaptable workforce that is contributing to the country’s growing innovation landscape. As more organizations invest in digital capabilities and emerging technologies, there is significant opportunity for Filipino innovators to help shape solutions that are both locally relevant and globally competitive.

With the 2026 GTI Competition in the Philippines, we look forward to seeing the next wave of Filipino companies bring forward innovations that can help shape industries, accelerate digital transformation, and contribute to the country’s growing technology landscape.

As innovation continues to drive the future of business and society, we remain committed to supporting technology entrepreneurs whose ideas and solutions have the potential to create meaningful impact and contribute to a more innovative and resilient future for the Philippines and beyond.

(The author is former Vice President of the Management Association of the Philippines (¶¶ŇôłÔąĎ). He is the Vice Chair, COO and Head of Global Services Center of R. G. Manabat & Co. (KPMG in the Philippines). Feedback at <map@map.org.ph> and <ebonoan@kpmg.com>).

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But let’s not pretend this is just about economics.

The defining lesson of the ongoing global tensions is this: wars are no longer won by weapons alone. They are won by logistics, industrial depth, and the ability to sustain conflict over time. Supply chains, not slogans, determine outcomes.

That is why these “Economic Security Zones” matter. They are not ordinary economic zones. They are strategic assets—forward platforms designed to support and sustain operations in the Indo-Pacific.

And that raises a critical question:

Are we positioning ourselves to benefit from this shift—or merely to serve it?

Ěý

The Risk We Don’t Talk About

Much has been said about the upside: jobs, capital inflows, and infrastructure. These are real and necessary. But they are also the least complicated part of the equation.

What is far less discussed is the risk.

If these zones evolve—as they likely will—into hubs supporting military logistics, defense manufacturing, and supply chain resilience, they will not be seen as neutral economic spaces. In any conflict scenario, they will be viewed as integral components of a broader strategic network.

In plain terms: they become targets.

This is not alarmism. It is the logical consequence of geography and function. The Philippines moves from the periphery to the map. And once on the map, exposure follows.

The question, therefore, is not whether we gain.

The question is whether we are being compensated enough for what we are putting at stake.

Ěý

From Resource Supplier to Industrial Power

There is a deeper, more consequential risk—that we repeat a familiar pattern: exporting raw materials while importing finished goods; supporting other nations’ industries while failing to build our own.

This must end.

The Philippines is rich in mineral resources, yet we continue to export largely unprocessed ore. This is not merely an economic inefficiency—it is a strategic failure.

A decisive policy shift—requiring or strongly incentivizing domestic smelters and processing mills—can fundamentally change this trajectory.

Smelters are not just facilities. They are catalysts.

They trigger entire ecosystems:

• Metals refinement and fabrication
• Industrial manufacturing clusters
• Machinery and component production
• Higher-value exports with stronger margins

This is how nations industrialize—by capturing value, not surrendering it.

If defense-related industries are among the likely locators—and all indicators suggest they will be—then the Philippines must demand integration into these higher-value segments.

We must insist on:

• Downstream processing, not just extraction
• Advanced manufacturing, not just assembly
• Technology transfer, not just employment
• Local industry participation, not just foreign enclaves

Otherwise, we risk becoming a service corridor in someone else’s supply chain.

Reclaiming Our Strategic Role: The Indo-Pacific Maintenance Hub

There is also a strategic advantage we already possess—but have not fully reclaimed.

At its peak, Subic Bay served as one of the most important logistics and repair hubs for U.S. operations in the Pacific. Ships, aircraft, and equipment depended on facilities in the Philippines for maintenance, repair, and rapid turnaround.

That role is now within reach again.

If we are to host Economic Security Zones, then we must deliberately position the Philippines as the primary Maintenance, Repair, and Overhaul (MRO) hub for U.S. forces in the Indo-Pacific—across land, sea, and air.

But we must think beyond routine servicing.

In times of conflict, forward repair capability becomes indispensable. Damaged ships and aircraft cannot wait for long-haul return to the U.S. They must be restored quickly and regionally.

This is where the Philippines has a decisive advantage.

We should insist on:

• World-class ship repair yards and drydock facilities
• A robust aerospace maintenance and repair ecosystem
• A highly trained and certified Filipino technical workforce
• Long-term integration of local firms into maintenance supply chains

These are not peripheral activities. They are central to operational capability—and they carry strong civilian and commercial spillovers for shipping, aviation, and industry.

Building a Middle Class Is a Strategic Objective

Economic transformation is not an abstract goal—it is about people.

A strong manufacturing and industrial base creates stable, high-quality jobs. It raises incomes, builds skills, and expands the middle class.

This is the foundation of long-term national strength.

But there is also a broader implication.

A stronger Philippine middle class strengthens not only the country, but its alliances. A more prosperous and stable Philippines becomes a more reliable partner for the U.S. and for the wider community of nations committed to open markets and regional stability.

In this sense, helping build a Filipino middle class is not simply an economic outcome—it is a shared strategic interest.

A stronger Philippines strengthens the alliance—and contributes to the resilience of the broader free world.

Negotiation Is Where Nations Rise—or Settle

Too often, we approach foreign investment with a mindset of accommodation rather than strategy.

That must change.

The Philippines today has leverage. Geography, alliances, and timing are on our side.

We must use it.

We must negotiate not as a passive host, but as a nation that understands its value:

• Binding, enforceable commitments—not vague assurances
• Industrial upgrading anchored on smelting and manufacturing
• Full MRO capability development for land, sea, and air systems
• Technology transfer and workforce development
• Local supply chain integration
• Defense and security support proportionate to the risks assumed
• Dual-use infrastructure serving both strategic and civilian needs

If we carry the risk, we must secure the reward.

Anything less is not partnership—it is imbalance.

Transparency Is Non-Negotiable

Finally, there must be transparency.

These are not ordinary investments. They carry long-term economic and strategic consequences. The public deserves clarity—not on sensitive details, but on the fundamental terms, benefits, and safeguards.

Transparency builds trust and gets the citizenry behind the idea. It ensures accountability. And it strengthens the legitimacy of decisions that will shape the nation’s future.

A Defining Choice

The Philippines is at a crossroads.

We can choose the easier path—welcome investment, accept standard terms, and gain incrementally.

Or we can recognize this moment for what it is: a rare convergence of strategic importance and economic opportunity.

We can remain a host.

Or we can become a force.

The difference will not be decided by external powers.

It will be decided by how we negotiate—and what we demand—for the Filipino people.

[The author is member of the Agribusiness Committee of the Management Association of the Philippines or ¶¶ŇôłÔąĎ.Ěý He is the Chair and President of BNL Management Corporation. Feedback at <map@map.org.ph> and <romeogdavid@gmail.com>].

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Innovation continues to shape the future of industries, economies, and societies. Across the world, technology entrepreneurs are developing solutions that are transforming how businesses operate, how communities connect, and how challenges are addressed. As digital transformation accelerates, platforms that support and recognize innovation have become increasingly important in helping emerging companies grow, scale, and create meaningful impact.

Over the past years, the KPMG Private Enterprise Global Tech Innovator (GTI) Competition has recognized hundreds of technology entrepreneurs from around the world, providing a platform that highlights innovative tech solutions capable of transforming industries and improving lives. More than a competition, the GTI program serves as a global platform where entrepreneurs, investors, business leaders, and advisers can connect, exchange ideas, and explore opportunities for collaboration and growth. It also helps surface emerging technologies that may otherwise remain within local markets, giving founders greater visibility and access to global networks that are critical to scaling innovation.

At the same time, innovation ecosystems are becoming increasingly inter-connected, where ideas, capital, and capabilities move more fluidly across borders. For emerging markets like the Philippines, this creates new opportunities for local start-ups to engage with global networks, adopt best practices faster, and position themselves more competitively in international markets.

Over the years, the GTI Competition in the Philippines has featured a growing range of local innovations addressing challenges across industries. In 2023, Peddlr, a local start-up providing digital solutions for micro, small, and medium-sized enterprises (MSMEs), was recognized for helping small businesses transition from manual sales tracking, inventory monitoring, and credit management into more efficient digital processes. The company’s solution highlighted how technology can help empower smaller enterprises, which remain an important driver of the Philippine economy.

In 2024, Rezbin, a cleantech start-up, won the competition with its smart recycling solutions focused on modernizing plastic waste recovery and sustainability initiatives. Its innovation demonstrated how technology can contribute to addressing environmental challenges while promoting more sustainable business practices and community engagement.Ěý The 2025 GTI Competition once again highlighted the growing strength of Filipino innovation and entrepreneurship through a diverse rangeĚýĚý of technology-driven solutions. Among the participating start-ups, Betterteem, a human resources (HR) technology company specializing in predictive AI solutions, emerged as the local winner and represented the country at the GTI Global Finals during the Web Summit in Lisbon in November 2025.

(The author is former Vice President of the Management Association of the Philippines (¶¶ŇôłÔąĎ). He is the Vice Chair, COO and Head of Global Services Center of R. G. Manabat & Co. (KPMG in the Philippines). Feedback at <map@map.org.ph> and <ebonoan@kpmg.com>).

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We drive this transformation through the Performance Governance System (PGS), a discipline that aligns strategy, operations, and budget to produce validated, high-impact results for the public. Originally adapted from the Harvard Business School’s Balanced Scorecard, the framework was deeply contextualized for the Philippine public sector and has since evolved into a distinctly homegrown discipline. While we proudly acknowledge its academic roots, today’s PGS is far from its original form. It is not a mere compliance exercise or documentation burden, but a discipline that aligns strategy, operations, and budget to produce validated, high-impact results for the public. It strengthens governance by embedding discipline in how strategy is designed, deployed, and sustained.

The system operated on three pillars: establishing clarity of direction, enforcing the discipline of execution, and ensuring the sustainability or reform. When an organization lacks clear direction, aligned targets, and regular performance reviews, decisions become reactive, accountability weakens, and fragmentation occurs. Over time, this creates space for inefficiency and potentially corruption to thrive.

To counter this, organizations through increasing levels of maturity across four stages – Initiation, Compliance, Proficiency, and Institutionalization – which are validated by strict audits. True institutionalization requires installing eight specific governance elements, including Basic Governance Documents, the Office of Strategy Management (OSM), and the Multi-Sector Governance Council (MSGC). Furthermore, under the modernized PGS 2.0, an organization’s strategy is no longer a scattered list of projects; it is anchored strictly on “Big Bets and Bold Moves” (BBMs). This BBMs are broken down into multi-year roadmaps and annual Strategic Commitments (SPCs), limited to a maximum of three critical initiatives per BBM.

To equip public sector leaders for this rigorous journey, ISA provided targeted interventions, including strategy formulation, cascading, OSM capacity building, and MSGC management.

We conduct Public Revalidas and Public Governance Fora, which are democratic, panel-evaluated presentation where organization through their leadership heads, must publicly validate their progress to advance to the PGS stage. We also offer Governance Boot Camps to equip participants with essential leadership skills, the 24-hour intensive EDGE (Empowered Development for Governance Excellence) certificate program, and 7-hour skills Labs focused in specific needs like government-mandated systems harmonization, agile leadership, and date management.

However, the crown jewel of sustainability in any transforming institution is the MSGC. The MSGC is a critical PGS element comprised of external stakeholders who provide independent advice and accountability support to the organization. To ensure diverse and holistic oversight, an MSGC is typically composed of distinguished sectoral representative from outside the agency, such as leaders from the academe, the church, the business sector, and the civil society.

This cross-sectoral input is vital because sustainable transformation cannot occur in an echo chamber. When a governance is weak, corruption thrives; engaging external stakeholders ensures that reforms are sustained and continuity of direction is maintained despite internal leadership changes. The MSGC helps institutions refine their strategy, identify emerging systemic risks, and foster external collaborations. It acts as the ultimate external accountability mechanism to ensure long-term goals survive internal leadership changes. Furthermore, MSGC meetings are highly efficient; they are anchored exclusively on the BBMs and are strictly prohibited from devolving into operational reporting or administrative updates.

Nowhere is the power of this shared governance more evident that in the Armed Forces of the Philippines (AFP). Both the Philippine Navy and the Philippine Army have achieved global recognition, earning their places in the Palladium Balanced Scorecard Hall of Fame for executing strategy. This was not achieved in a vacuum. As AFP Chief of Staff Gen. Romeo Brawner Jr. recently noted, the evolution of the AFP into a professional force that commands the people’s trust was a result of a deliberate, 15-year strategy known as the AFP Transformation Roadmap. Anchored on the discipline of the PGS, this roadmap required the military to set clear goals, measure performance relentlessly, and subject themselves to external validation.

A significant pillar of this global excellence is their engagement with their respective MSGCs. As Gen. Brawner emphasized, while soldiers carried out reforms within ranks, the participation of those outside it was equally vital. The civilian councils – composed of leaders from civil society, academe, business, and faith-based groups – serve as the transparency and governance partners of the AFP. They provide a external check that holds the institution accountable to the public, ensuring that the goals of the AFP Transformation Roadmap reach practice, not just paper.

This brings us to a critical lesson in public sector management: in governance, isolation breeds stagnation.

There is occasionally a temptation within massive bureaucracies to view advisory councils as administrative distractions, or to restrict their meeting in the name of internal efficiency. This is a severe miscalculation. Under the disciplined framework of the PGS, MSGC meetings are highly efficient as they are anchored exclusively on the institution’s BBMs and are strictly prohibited from devolving into operational reporting.

To prohibit these councils from convening, or to retreat into isolation eventually surrender to the very inefficiencies they fought to defeat. Engaging external stakeholders is no mere administrative courtesy, as it is the armor that protects long-term reform from vulnerabilities of short-term transitions. Building our Dream Philippines is a relentless, shared pursuit, and shutting the door on cross-sectoral collaboration dismantles the very bridges that brought our institutions to world-class standards. We must not merely “allow” these councils to convene; we must fiercely defend their space, for they are the indispensable guardians of the nation we aspire to build.

[The author is Past President of the Management Association of the Philippines or ¶¶ŇôłÔąĎ.Ěý He is also a former President of the Development Bank of the Philippines, former Undersecretary of the Department of National Defense, Chair of ISA and Chair of the AFP-MSGC. Feedback at <map@map.org.ph> and <delrosariofjr@icloud.com>].

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The 2026 Landscape: A Q2 and Year-End Reality Check

The declaration of a State of National Energy Emergency has created a landscape defined by scarcity and soaring costs. We saw diesel prices reached staggering heights of ₱107 to ₱134 per liter, while gasoline fluctuates around ₱112 per liter before going down the past few weeks. Approximately 400 to 425 gas stations have shuttered temporarily across the nation because they simply cannot get products to sell. By the end of 2026, inflation might likely exceed the current 4.1%, directly hitting the purchasing power of every Filipino family. With real income for vulnerable households dropping, the cost of doing business has fundamentally shifted. Internal labor stability and external customer demand are both under extreme pressure.

Financial Management and Crisis Impact Report

Consistent with its enterprise risk mandate, the AudComm should require Management to move beyond retrospective review and provide a forward-looking “Crisis Impact Report”. The Report should critically address areas like:

Revenue and Expense Modeling: The company must assess the impact on revenues and identify which expenses are skyrocketing. With logistics and raw material costs expected to rise, the company must evaluate whether to pass these to customers or absorb them. This isn’t just a financial choice; it is a strategic one that considers the absorption capability of customers who are also feeling the pinch.

Liquidity and “Cash is King”: Survival depends on liquidity. The AudComm must oversee actions being taken by the company to not only pursue the timely collection of receivables but also to ensure the availability of credit lines. In a credit crunch, the AudComm must confirm that committed facilities are in place to sustain operations.

Inventory Risk Management: The focus shifts from “just-in-time” to “just-in-case”. The company must look at inventory not just as a cost, but as supply security. It must evaluate the risk of supply unavailability and the company’s ability to use local substitutes to minimize the high premium of “war imports”. Conversely, for products where demand is expected to drop or disappear, the company should recognize inventory obsolescence provisions. AudComm has to check actions by Management on this regard.

Energy Transition to Renewables: Crisis is a catalyst for structural change. It is an opportune time to reengineer processes and transition to crisis – resilient operations. For example, the company should study the replacement of oil-sensitive fixed assets with renewables. This might require a collaborative look at “lease vs. buy” financing that protects the company’s long-term future while recognizing immediate impairment on obsolete equipment. AudComm can help crystallize actions on this matter.

Covenant Monitoring and Contract Review: High energy costs directly impact EBITDA and interest coverage ratios. The AudComm should demand monthly stress tests on debt covenants to anticipate potential breaches before they occur. Moreover, many long-term agreements might have become “onerous” as the cost of delivery or fulfillment significantly exceeds agreed contract prices. The AudComm should oversee legal assessments to determine if the crisis constitutes a “Force Majeure” event, allowing for the renegotiation of terms with suppliers or customers.

Cybersecurity: Crisis heightens the risk of cyberattacks and fraud on financial infrastructure. The AudComm must ensure the IT disaster recovery plan is stress-tested for worst case scenarios.

The Working Environment: Protecting the Human Capital

Labor often bears the brunt of the crisis through eroded wages. The company’s HR management response defines the true values of an organization. HR actions may include regular, honest updates on how the crisis is impacting the company. Transparency builds the trust necessary for employees to accept difficult changes, like compressed workweeks. Treating employees with dignity and strategic care during a national emergency isn’t just a moral choice; it’s a business continuity requirement. Support should be practical and empathetic, ranging from allowances or company provided transportation for essential staff when public utility vehicles stop operating.

Summary

Ultimately, the 2026 energy emergency transcends technical compliance; it is a foundational test of our institutional character. The AudComm’s mandate must now encompass a dual necessity: serving as the unyielding anchor for fiscal survival while acting as the strategic catalyst for resilience and renewal. Yet, its most enduring legacy will not be found in the balance sheets, but in how effectively it protected the human core of the organization amidst the chaos. It is through this synthesis of rigorous discipline and deep empathy that AudComm honors its highest fiduciary duty—to the stockholders, to the employees, and to the public.

[The author is member of the Ease of Doing Business Committee of the Management Association of the Philippines (¶¶ŇôłÔąĎ).Ěý He is an ICD Fellow, a Board member and Corporate Treasurer of Color Philippines, Marking Services Philippines and Eagan Services Philippines. He was Chair of the Quality Assurance Review Council of the Board of Accountancy and the Philippine Institute of CPAs. He was a Partner and Head of the Assurance Division of P&A and former President of P&A Grant Thornton Outsourcing Inc. Feedback at <map@map.org.ph> and <jccarpio627@gmail.com>].Ěý

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Did you know that waste water is being monitored by DENR-EMB, and there are about 17,000 industries around the country that they look after, to ensure that all effluent water is managed and treated? That ensures we can then have clean water for everyone to use. It was so interesting to know the different classes of water – from “safe to drink” to “safe to just bathe in” and “safe just to float a boat in.” Imagine the agency trying to monitor these businesses even if all they have is a single toilet facility or one water closet. For as long as you discharge water, you are in the purview of Engineer Sibunga’s department.

She walked us through the challenges of her work because of errant companies, who may just pay the penalty but still not comply fully with waste water laws. She gave the extreme example of a restaurant that simply washed knives, and had no toilets. But when you wash, you still have waste water and you have to ensure you find a way to treat it. But the big offenders are really the extractive industries, like mining and electronics manufacturing. Asked what the most dangerous substances are in our waste water, and she mentions heavy metals, like cadmium, lead and mercury. And those are toxic for humans and all forms of life.

And this is why we need to prevail upon industry owners and leaders to understand how their business operations can affect our water supply. It is not enough to be able to afford the penalty.Ěý What is required is that we attend a Pollution Control seminar as executives—even for just 8 hours—to know that our business is responsible enough to treat our waste water. It sounds simple and we actually had her laymanize all the scientific tables which we understood after her brief explanation during the webinar.

There are many laws to protect the environment and it takes a lot to enforce because even Local Government Units (LGUS) are involved in the inspection and implementation of the law. But what if the local executive is involved in the errant company? She smiled and said she may have to get the Philippine National Police (PNP) to help as DENR has no police power. DENR simply has the parameters and knowledge of the law and the danger these errant companies can cause to pollute the environment.

Further, some fines have been overtaken by inflation and are now too affordable for companies who do not comply with the law. The laws need review so fines and penalties can be more onerous and painful for offenders. Using the carrot and stick method, other than the “stick” of fines and penalties what are the “carrots”?Ěý What are the incentives so companies will comply? There used to be tax incentives when the law was passed, but it was only good for ten years. That has long expired and nothing compels companies to try and comply to clean the water they discharge. Except the moral obligation that CEOs must abide by. If your industry is a pollutant or prospective pollutant because of the nature of your business (manufacturing, electronics, mining, etc.) you should be mindful of the waste water you produce and ensure that you return the “cleaned up” or treated water back to the system.

But what we do not know won’t hurt us. So we ask executives, CEOs and COOs to attend the enlightening 8-hour seminar of the DENR-EMB along with their Pollution Control Officers (PCOs) so they have a better understanding and moral suasion to prevent damage to the environment. This way, our companies will not only be compliant, we can be a more responsible company that sets the example for others. It could also be a competitive advantage once our consumers find out we are not a polluting business, but a caring one.

Engineer Sibunga is hopeful that if more company leaders understood the Water Quality regulations, the more companies will comply and the DENR will achieve their goal of making sure there is clean water for everyone. We call upon our legislators as well to look into the penalties which have been rendered affordable by inflation. They are too cheap compared to the damage dirty water can cause to agricultural crops, water that goes through our water distributors and even our drinking water. We looked at each other during the webinar because what we had infront of us was bottled water, and why do we drink bottled water? Because we are unsure about the safety of our tap water, and oftentimes establishments need to install filters to make sure our tap water is safe to consume.

We have the laws. In fact, we have a lot of good laws to protect the environment, but its enforcement is the challenge for many agencies, including DENR-EMB. There seems to be a lack of personnel and budget to monitor the growing number of firms whose activities affect our water systems. Maybe with the use of AI and advancement in technology, we may just be able to monitor better and reward those who care and punish those who don’t. In the meantime, take a look at your company and have the moral suasion to do something about it. Remember, the damage you cause may just end up in your own drinking water.

(This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or ¶¶ŇôłÔąĎ.Ěý The author is Co-Chair of the ¶¶ŇôłÔąĎ Environment Committee. She is also the Chair of Philippine Coffee Board Inc. and Slow Food Manila (www.slowfood.com). Feedback at <map@map.org.ph> and <pujuan29@gmail.com>).Ěý

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The fourth lesson is about the importance of central banking. In the 1970s, weakly independent central banks, heavy wage indexation, and strong political pressure to accommodate inflation led European countries to experience stagflation—high inflation with low growth. Only in the late 1980s and 1990s, with stronger central bank independence and clear inflation-targeting regimes, did Europe manage to anchor expectations and control inflation; ASEAN reforms in these areas came much later.

Indeed, in 2026, ASEAN central banks are, in several respects, ahead of where Europe once stood decades ago: most have explicit or implicit inflation targets, operational independence, and experience in managing capital flows and commodity shocks. This is a significant advantage.

However, monetary policy alone cannot resolve the problems caused by oil shocks. Energy price spikes are supply-side shocks: while raising interest rates can suppress demand and prevent secondary effects, it cannot generate new supplies of oil, gas, or electricity. Relying solely on central banks to “solve” such crises risks unnecessary economic sacrifices and social tension.

Why ASEAN Needs a Broader Policy Mix

To manage extended oil-shock conditions in the modern era, monetary policy must be supplemented by at least three additional pillars: fiscal policy, structural competitiveness, and human capital.

Fiscal policy : Avoid blanket subsidies; use targeted fiscal support.

1. Protect the vulnerable through targeted cash transfers or lifeline tariffs, instead of across-the-board fuel subsidies that distort prices and strain public budgets.
2. Invest in efficiency and alternatives, such as public transport, building retrofits, and industrial energy-efficiency programs, so that every unit of GDP requires less imported fuel.
3. Use fiscal tools to crowd in private investment in renewables, storage, and grids, rather than locking the region into continued fossil-fuel dependency.

Structural competitiveness: Reform to keep energy markets efficient and prices transparent.

1. Avoid monopolistic practices, inefficient state-owned enterprises, and closed markets since oil shocks expose and worsen rigidities.
2. Make firms more resilient to price spikes through competition policy, transparent regulation, and regional market integration that can lower structural energy costs.
3. Deepen energy integration (AEMI), harmonize standards to create a larger and more flexible energy market for businesses.

Human capital: Build the skills/ knowledge plus values/ attitudes for a resilient energy system—from engineers, regulators, financiers, entrepreneurs, to politicians and diplomats.

1. A resilient energy system ultimately depends on such people, especially those with the values/ attitudes required for transparent 21st C. public and private governance systems for higher realized standards of ethical public service; for the latter, domestic work vs. overseas employment to be more attractive for family conditions to be socially tenable.
2. Investing in STEM education, vocational training, and energy-sector skills will enable ASEAN to adopt new technologies—such as smart grids, hydrogen, and advanced storage—rather than just importing them.
3. Joint ASEAN–EU R&D and training programs can accelerate progress, echoing Europe’s own history of collaborative technology development after the 1970s.

Central banks can stabilize expectations better through a whole-of-government and whole-of-economy strategy to transform an oil shock from a crisis into a catalyst for positive change.

A 2026 Opportunity

The 2026 Philippines leadership of ASEAN comes at a time when energy security, climate transition, and geopolitical fragmentation are intersecting. Europe’s history from the 1970s to the 1990s demonstrates the right policy combinations for ASEAN to survive the next oil shock—but only if matched with smart fiscal choices, competitive markets, and strong human capital in ASEAN.

To avoid geopolitical and geoeconomic traps, it is time for regional leaders and diplomats to creatively strategize ASEAN’s vision as a Zone of Peace, Freedom, and Neutrality.

(This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or ¶¶ŇôłÔąĎ. The author is Philippines’ Undersecretary /Acting Secretary of Foreign Affairs in the 1990s, chaired the preparatory Senior Officials Meetings for the 1996 APEC Economic Leaders’ Meeting in Manila/Subic, and is now active with the ¶¶ŇôłÔąĎ. Feedback at <map@map.org.ph> and <fmmacaranas@gmail.com>).

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Recent research highlights a shift from targeted persuasion—communication aimed at convincing specific people—to information saturation and disruption, in which the goal is to overwhelm people with excessive information. The RAND Corporation calls this the “firehose of falsehood,” a model that uses high-volume, rapid messaging—often with inconsistent or conflicting statements—to flood audiences and make it hard to determine what is true.

For Boards and senior executives, the nature of the threat has shifted. The risk is no longer just a single false story but the erosion of a shared factual reality. This complicates crisis response and investor relations. These risks are real—they are documented globally and are especially relevant in the Philippines, one of the world’s most active social media environments. The challenge stems from information saturation and disruption, the “firehose of falsehood” model: high-volume, rapid, and often contradictory messaging that overwhelms rather than persuades. For Boards, the primary threat is not a single false narrative but the loss of a shared factual baseline. This makes both crisis response and stakeholder communication harder. This context frames the tactics behind modern disinformation.

The Three Pillars of Disruption

Modern disinformation campaigns, whether driven by state or decentralized actors, typically pursue three main objectives:

• Confusion: Flooding the information space with conflicting narratives reduces the public’s ability to distinguish fact from fiction.
• Division: Messaging exploits social and political divisions, pitting stakeholders against each other.
• Erosion of Trust: Ongoing exposure to manipulated content erodes public trust in institutions, including corporations.

Why the Philippines is “Patient Zero”

Corporate leaders in the Philippines face heightened exposure. Researchers call the country “patient zero” for large-scale social media manipulation. The Philippines has some of the world’s highest rates of social media use. It is also a “fake news factory,” where coordinated campaigns, influencer networks, and “troll farms” precisely shape public perception.

In this environment, brand reputation is not just about performance; it is a target of coordinated narrative attacks. We are now seeing the rise of several new tactics:

• Synthetic Media (Deepfakes): AI now enables the creation of hyper-realistic fabricated content. This includes fake CEO statements or false evidence. Such content can be used to blackmail or undermine real corporate communications. Deepfakes also make it easier to create false evidence or to undermine real evidence (“liar’s dividend”).
• Memetic and Viral Content: Short, emotionally charged content spreads faster than factual information. Content that triggers anger or fear often bypasses analytical reasoning.
• Narrative Framing: This technique presents factually correct information in a way that still deceives. By emphasizing some details and omitting others, communicators can mislead stakeholders.
• “Insider” Leaks: Disinformation often appears as content claiming to be privileged or suppressed knowledge. These so-called “leaks,” which are unverified information from anonymous sources, can quickly gain traction during corporate crises.

These narratives can gain traction quickly during corporate crises, especially when official information is limited. Emotionally charged content spreads more widely and influences judgment. Anger and fear reduce analytical processing, and high emotional arousal increases sharing behavior.

The Philippine environment presents unique amplifiers:

• High Social Media Penetration: The country ranks among the highest globally in time spent on social media, increasing exposure to viral misinformation.
• Influencer and Networked Campaigns: Political messaging, influencer marketing, and entertainment now blend, blurring the line between organic and coordinated content.
• Trust Dynamics: Public trust in institutions can shift quickly, making narratives—positive or negative—more volatile. According to the World Economic Forum, misinformation and disinformation erode trust and exacerbate societal divides.

Quantifying the Enterprise Risk

This is not merely a social problem. It is a systemic enterprise risk with tangible impacts:

• Financial and Market Risk: Disinformation can trigger sudden market swings that can affect stock prices and erode partner confidence.
• Operational and Internal Risk: External narratives can trigger internal polarization. This can fracture workforce cohesion and hinder decision-making.
• Regulatory Risk: Governments are watching as the EU and UK increase scrutiny of how companies manage their roles in the information ecosystem. Various countries have implemented some form of “truth in content”. Failing to address these risks can result in significant political and regulatory exposure.

A Deliberate Response for the Boardroom

Given the speed and scale of these threats, Boards must act decisively. Move beyond reactive measures: establish a dedicated information risk committee at the Board or executive level. Implement regular scenario planning and tabletop simulations to strengthen readiness and crisis response. Require periodic briefings on emerging manipulation tactics and annual reviews of information risk management policies to ensure alignment with evolving threats. Take these concrete steps now to embed a strategic mandate in practical governance.

• Integrate information risk into Enterprise Risk Management (ERM). Disinformation is false or misleading information spread to deceive. It should be recognized as a formal category within enterprise risk governance, not merely a public relations issue. Boards can formalize this by including information risk in the enterprise risk register. Establish clear reporting lines for relevant risk committees or the Board. Ensure that regular risk reports specifically address information threats. Assign Board-level or executive oversight of information risk to ensure accountability and integration across business functions.
• Invest in Narrative Tracking. Boards should use social listening tools to detect coordinated activity and emerging narratives early. When selecting tools, Boards should consider several criteria, including the ability to scale enterprise needs, comprehensive coverage of relevant platforms, support for local languages, advanced alerting, and compliance with data privacy requirements. Tools with intuitive dashboards and customizable reporting also enhance Board-level oversight. Assess vendors on these points to catch issues before they reach a tipping point.
• Build Resilience through Literacy. Leaders and employees should receive media literacy training to help them recognize misinformation, including synthetic media, misleading narratives, and manipulative content. Key goals include critically evaluating digital content, understanding viral dynamics, identifying sources, verifying claims, and practicing accurate messaging during incidents. A 2025 study identified effective and ineffective corrections, provided practical insights for social media platforms, and suggested designs for more effective interventions.

Expanding Threat Landscape: Beyond State Actors

While state-sponsored campaigns often attract attention, similar tactics are also used by political actors, activist groups, competitors, and opportunistic bad actors. Social media manipulation by political actors is now an industrial-scale problem, prevalent in over 80 countries. We must recognize that information risk is persistent and multidirectional, not limited to geopolitical conflict.

Key Takeaways for Directors

• Information risk is now a core strategic risk, not merely a communications issue.
• Modern propaganda often aims to confuse and divide, not merely persuade.
• The Philippines presents a high-exposure environment because of high digital literacy and consumption levels.
• Emotional and viral dynamics can quickly escalate reputational crises.
• Proactive governance and preparedness are essential for mitigating the impact.

The contemporary information environment moves quickly and operates on a vast scale. Disinformation campaigns, whether state-driven or decentralized, exploit this speed and complexity to influence perception, behavior, and trust.

Call to Act

Today’s information environment is complex and contested. Managing disinformation cannot be confined to corporate communications. Information risk is now a core strategic threat that can destabilize stock prices, polarize workforces, and erode customer trust.

Boards must ensure that information integrity is a core part of enterprise risk management. Institutional strength in the “post-truth” era depends on leadership. Leaders must understand both the company’s messaging and how the broader information environment is manipulated. Boards need to build institutional resilience. This is not just about responding to incidents but about protecting information integrity in a contested landscape. To support effective governance and clear accountability, oversight of information risk should be formally assigned to the Board. Ideally, this responsibility would be given to the Risk Committee, or, if not already established, to a dedicated Information Risk Committee or to a designated Board officer, such as the Chief Risk Officer, who would ensure that strategies and controls are in place and regularly reviewed. This explicit assignment clarifies ownership and supports strong follow-through on mitigation and preparedness.

A disciplined, research-informed approach, paired with local market awareness, will be critical to navigating this evolving risk landscape.

(The author is Governor and Secretary of the Management Association of the Philippines or ¶¶ŇôłÔąĎ.Ěý He is a retired banker and Globe and Ayala executive, and a member of the Analytics and AI Association of the Philippines and the Institute of Corporate Directors. He is an Independent Director at GT Capital Holdings, Puregold Price Club and Megawide Construction. Feedback at <map@map.org.ph> and <iamgilgenio@gmail.com>).

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