Globe Telecom (PSE: GLO), commonly shortened as Globe, is a major provider of telecommunications services in the Philippines. Formed out of a partnership between Ayala Corporation and Singapore Telecom, the company operates one of the largest and most technologically advanced mobile, fixed line, and broadband networks in the country, and maintains a large distributor and over-the-air reload network of retailers, distributors, suppliers, and business partners nationwide. In 1928, Congress passed Act No. 3495 granting the Robert Dollar Company, a corporation organized and existing under the laws of the State of California, a franchise to operate wireless long-distance message services in the Philippines. The Robert Dollar Company subsequently incorporated in the Philippines as Globe Wireless Limited and in 1934, Congress passed Act No. 4150 transferring the franchise and privileges of the Robert Dollar Company to Globe Wireless Limited. Globe Wireless Limited was subsequently renamed Globe Mackay Cable and Radio Corporation.
Congress, through Republic Act 4630 enacted in 1965, further expanded its franchise to allow it to operate international communications systems. Globe Mackay Cable and Radio Corporation was closed in the Philippines by Martial law. Shortly before the expiration of its franchise, the Batasan Pambansa in 1980 enacted Batas Pambansa 95 granting Globe Mackay Cable and Radio Corporation a new franchise. In 2013 Globe Telecom open its new corporate headquarters in Bonifacio Global City (BGC) (Formerly Located In Pioneer Highlands InMandaluyong City) last August 6, 2013. To mark its arrival in BGC, a part of the commercial hub (known as Bonificio High Street) was turned into an amusement park in August 2–4, 2013. As of December 2013, Globe Telecom has a total of 14,952 base stations and 9,012 cell sites nationwide to support its 2G, 3G, 4G HSPA+, LTE and WiMAX services.
The Globe Telecom Headquarters at
32nd Street in Bonifacio Global City,
II. STRATEGIC PLATFORM
Globe is indispensable to people’s lives-
We provide our customers with superior experience,
We are center of excellence for innovation wolrdwide,
We create a rewarding environment where people strive for excellence and grow,
We attract people who are innovative, passionate and result-oriented,
We create superior value to our shareholders
We make great things possible.
Transform the lives of people, businesses and communities
through innovative solutions.
STAKEHOLDER ENGAGEMENT METHODOLOGY
Attractive Dividend Yield For Shareholders
Globe Telecom’s sustained revenue momentum and improved market position were reflected in the financial valuation metrics. The company’s market capitalization remained relatively steady at ₱144.6 billion by the end of 2012. Globe likewise maintained an attractive dividend yield of 5.8%. Globe paid dividends totaling ₱8.6 billion in 2012, representing a pay-out rate of 86% of 2011 core net income. This is consistent with its recently updated dividend pay-out policy of distributing 75% to 90% of prior year’s core net income. Continued Commitment To Creating Shared Value For All Stakeholders In addition to our commitment to ensure the sustainability of our core business, we continue to develop opportunities in adjacent spaces. In the area of mobile banking and microfinance, under BPI Globe BanKO Inc. (BanKO), (our mobile microfinance joint venture with Ayala Corporation and the Bank of the Philippine Islands) Globe’s mobile money platform and BPI’s banking infrastructure combined to deliver affordable microfinance services to the unbanked segments of the population. Through 2012, BanKO has continued to expand its network of partner outlets, which today number 2,000. Its wholesale loan portfolio has grown to more than ₱2.4 billion, spread across microfinance institutions, including non-government organizations, rural banks, cooperatives and financing companies. Within two years of operations, BanKO has gained over 261,000 retail customers and increased its retail loan portfolio nine-fold. Business Incubator Program
Another pioneering initiative by Globe is the launch of its business incubator program through Kickstart Ventures, Inc. (Kickstart). Designed to support and develop the Philippines’ dynamic and growing technopreneur community, Kickstart is envisioned to provide aspiring technopreneurs with needed funds, facilities, infrastructure, mentorship and market access to build new businesses. By providing the tools needed to build and test ideas, by providing seed funding, and by providing training and mentorship as well as connecting technopreneurs with partner companies within the Globe, Singtel, and Ayala networks in the Philippines and abroad, Kickstart provides selected startups increased chances to succeed and scale faster. Since its launch last April 2012, Kickstart already has 10 companies in its portfolio covering the digital media and technology, and web/mobile platform space.
A. Employment Diversity
Globe Telecom believes in the potential of the Filipino workforce. That is why the company welcomes every employee regardless of gender, age, religion or ethnicity. Any form of discrimination is never acceptable and embracing every unique worker is part of the company’s philosophy. Currently, Globe employs close to 6,000 male and female workers from staff to senior management levels. The table below shows the summary of the company’s total workforce by employment type, contract and region.
B. Employee Remuneration
The lowest actual salary of Globe Telecom employees covered by the Collective Bargaining Agreement (CBA) is 15% above the minimum wage mandated by the Department of Labor and Employment (DOLE). As per ratio of basic salary, male employees have a slightly higher rate compared to female employees due to the varied responsibilities undertaken by male employees compared to female employees. however there is no discrimination for a given job profile based on the gender. The variance in comparative salary is due to the varying job profile undertaken by male and female employees. a. Employee Benefits
b. Employee Health And Safety
Affirming its commitment to quality health and safety practices in the workplace, Globe obtained an Occupational health and Safety Management System (OhSAS) 18001 certification for the Valero Telepark. Steps are being undertaken for other Globe Telecom locations which aim to achieve the OhSAS certification. To strengthen ensure employee health and safety, the company employs a dedicated health and safety committee. 10.06% of the Globe workforce provides hands-on commitment on health and safety practices covering all areas – nationwide in areas where Globe Telecom operates.
For the year 2012, 5.04% employee accident rate was recorded, mostly due to vehicle driving-related incidents. however, no fatalities causing death or permanent disability were recorded. In order to minimize these incidents, the company conducts several trainings and awareness programs for the relevant employees, on safe driving and fuel economy. 1. Defensive Driving Course
2. Construction Safety
3. Confined Space Entry
4. Electrical Safety
5. Industrial First Aid and Basic Life Support
6. Industrial Climbing, hauling & Rope Access
Guaranteeing employee safety and security, qualified licensed security guards are hired by Globe to provide protection in case of uncontrolled events. Globe ensures all security staff undergoes trainings every three years. This includes a two-day course on RA 5487 – Private Security Agency Law which discusses professional conduct and ethics that must be performed by the security. Laws on arrests, searches, seizures, strike and lock-outs are also tackled. Furthermore, a one-day course on RA 9372 – human Security Act of 2007 is also undertaken, as well as a half-day course on Gender Sensitivity Awareness.
C. Strategic Objectives
C. COMPETITIVE POSITION
a. Faster and Better Network
Business In 2011, in line with the vision of a differentiated customer experience, Globe shifted beyond the regular Customer Satisfaction mindset and created the total customer experience, which would allow the company to engage not only its customers but also the employees and shareholders who are at the forefront of Globe Telecom’s priorities. Faster customer service feedback was put in place truly making the customers satisfied with the improved modifications. The company’s commercial transformation in the year 2012 focused on changing the very foundations of its back office systems, including the corporate support and internal processes. By allowing changes to ripple out from within, the customers and stakeholders could see past the change in the façade and overall ambiance of its stores. The customers can actually experience the difference with each transaction and interaction in every Globe Store. The company’s strength is its dynamism and boldness to change for its customers, employees and shareholders. In order to fully become a catalyst of change, Globe understands its need to be relentless in the quest for excellence and continuously transforming the company from within. In 2012, Globe continued with the transformation programs under the 5-pillar transformation plan which was started in 2011.
As an innovator in the telecommunications industry, a constant part of Globe Telecom’s transformation includes the continuous development of the network. Invested a total of $700M for its network modernization program which envisioned delivering faster and unparalleled customer experience in the country while positioning itself as the leader and one of the best
telecommunications providers in Asia. People have started to rely more and more on social networking to stay connected. Also, with the growing number of smartphone users, Globe saw the need to future-proof the network to accommodate the constant increase in network traffic especially on data.
Phase 1 of the Network Transformation is the upgrading of the network system’s access portion. The company replaced the old hardware and technology in its cellular sites, power sources, base stations and switches allowing the access portion to become more powerful and energy-efficient.
At the end of 2012, Globe was able to modernize more than 80% of its cellular sites and upgrade its network system nationwide. Starting within the National Capital Region (NCR), Makati City, being the country’s premier business area, significantly benefitted from the network transformation. The network development coverage includes key locations of the city and are now enjoying stronger Globe signal. Aside from Makati, other areas such as Caloocan, Malabon, Navotas, Valenzuela (CAMANAVA), Marikina, Manila, San Juan and Mandaluyong were completed in the last quarter of 2012. Taguig, Pasig, Paranaque, Pasay, Las Piñas and Pateros followed after.
In the Visayas region, Cebu took the lead in equipment modernization. Other Visayan key provinces lined-up for the transformation are Leyte, Samar, Bohol, Iloilo and Roxas, consecutively. Meanwhile in the Mindanao region, the major modernization took place in Davao as well as in Zamboanga and Misamis Oriental. Improved mobile connectivity was achieved through the modernized facilities. Improvements for the province of Sulu, cities of Surigao and Butuan were carried out during the last quarter of 2012 and in Agusan del Sur by early 2013.
In addition to the upgrades, Globe installed more resilient fiber optic cables in more areas to serve more customers and greatly improve voice and text messaging quality as well as provide faster internet services. An installation of a submarine cable in Boracay was also completed and the same facility is being worked on in Palawan, which is due for completion during the first quarter of 2013.All in all, the nationwide improvements allowed clearer voice call quality, easier connection, on-time delivery of text messages and faster mobile surfing and downloading.
Globe has successfully upgraded 4,000 cell sites to 4G – LTE, hSPA+ and WIMAX providing better network experience to 91% of its customers. As the transformation program continues to take place in the year 2013, Globe would be able to provide greater network availability, impressive quality on voice calls, instantaneous delivery of SMS, improved call set-up rates and faster browsing with minimal buffering of multimedia content to every Filipino mobile user.
D. EMPLOYEE DEVELOPMENT
GROW AT GLOBE
Globe continues to invest in its people through various professional training and development activities. Globe follows a 70/20/10 Development Plan – 70 % of the learning occurs on-the-job, 20% from others and 10% from formal training. The 70% on-the-job experience includes the regular employee tasks based on their office function. Others are their committee participation, customer immersion and job rotation. Meanwhile for the 20% learning from others, the development comes through the coaching or mentoring of the immediate superiors and other colleagues. Job shadowing and observation also help as well as knowledge transfer from other professionals and consultants. Last but not least, the 10% formal training and learning is expanded through the offered training programs and courses offered by Globe. A. Integrated Leadership Development Programs
iLeadGlobe aims to develop key talents into future leaders who role-model the Globe Way and practice the 7 Globe Leadership Competencies, namely, customer orientation, people orientation, personal values, entrepreneurial mindset, execution excellence, innovation and strategic thinking. The programs are all highly selective with eligibility criteria relevant to the participants that are handpicked by the Senior Leadership Team through a stringent talent review and nomination process. The series of trainings include the Executive Development Program (for the next generation of senior
leaders), Fast Tracker Program (for the mid-career talents) and Young Leaders Program (for emerging talents).
b. University Partnerships
Globe Telecom partnered with the Asian Institute of Management (AIM) and the Ateneo de Manila – Center for Continuing Education and opened programs for the employees who are interested to develop their leadership and management skills the Globe way. The series of trainings include the Globe-AIM Management Development Program (for managers who aspire to hone and apply management skills), Globe-Ateneo Empowering Leader program (for mid-career to seasoned career employee who has the potential of a Globe Leader) and the Globe-Ateneo Emerging Leader Program (for junior leaders with the potential of evolving as a Globe Leader). To date, more training are being developed by Globe to ensure coverage and eligibility of all employees and grant them more learning and knowledge to future-proof their careers. Course descriptions for Sales and Marketing Academies are presently under development at the time of production of this report. c. Junior Mobile Wizard
The Junior Mobile Wizard Program is a one-month summer program offered to Globe employees’ high school children, providing them the opportunity to better understand the Philippine telecommunications industry. Pioneered in 2012, 18 high school students joined the program to assist in selected Globe concept stores in Metro Manila. They were tasked to demo the latest gadgets and mobile data services, as well as sell other Globe offers and services. d. Graduate 2 Globe
Graduate 2 Globe (G2G) Program is a development program for high potential, future talents of Globe in partnership with top colleges and universities. Activities include the Get-to- know-Globe (Company Orientation), Singtel Undergraduate Scholarship, Globe Summer Internship and Post Graduate Internship Program, Cadetship and Management Development Program. e. Customer First Circle (CFC) Program
Customer First Circle is a continuous improvement program that ultimately aims to foster and create a customer-centric culture within Globe. In order to achieve this, CFC uses the Lean Six Sigma Methodology as a vehicle to drive down cost, improve customer experience and increase revenue. To date there has been over a thousand employees participating actively with over a hundred projects and billions of financial benefit.
B. TECHNOLOGICAL LEADERSHIP
C. PUBLIC RESPONSIBILITY
Globe Telecom continues to aspire growth in all facets of the business but at the same time in fully taking care of the planet. The efforts to minimize impacts persist through the Environmental Management System being implemented in the workplace. The system already began in 2011 for the Valero Telepark office as certified by the ISO 14001 (Environmental Management System) while certification of GT-IT Plaza in Cebu started in 2012 with completion in 2014. Such initiatives and environmental system in place contribute to a greener and more sustainable Globe Telecom. a. Environmental Sustainability Policy
We are committed to promote environmental sustainability by reducing the impact of our business operations to environment and we shall achieve this together with the help of our employees, business partners and clients. We have robust systems in place to manage our environment impact and integrate them into our corporate social responsibility management. We commit to: • Consciously move towards the continuous reduction of our ecological footprints from our operations. Where possible, we will move beyond regularly compliance and apply best practices and global voluntary standards on environmental and social responsibility.
• Manage emissions from our energy use, particularly to our networks and ensure that we carry out regular assessments on how energy is consumed within our network to monitor our climate impact and identify opportunities to reduce it. • Comply with all environmental laws and other laws relevant to our business. • Encourage and train our employees and business partners to help us reduce our environment impact by communicating our policies and programs. • Partner with organizations which share the same environmental values and find ways of cooperation to protect the environment. • Conduct a review of our environmental management system to ensure that the commitment of this policy are delivered and that we strive for continuous improvement. • Report our environmental performance to our stakeholders.
b. Globe telecom Environmental Strategy
c. Globe Brigding Communities
Globe BridgeCom Pillars
The i-Prosper program works with social enterprises and micro-entrepreneurs to establish sustainable forms of livelihood for bottom of the pyramid (BOP) sectors nationwide. Applying the same philosophy of Globe Telecom’s triple bottom-line approach of doing business, the program aims to introduce socially responsible income- generating opportunities for the entrepreneurial poor through capacity development, provision of capital and market access. 2. i-Lead
The i-Lead pillar is dedicated to the establishment of peaceful, orderly and progressive communities through the advancement of good governance and excellence in public service. It aims to promote accountability, transparency and increase one’s participation in governance through infrastructure support capacity development. More importantly, the program intends to empower barangay officials and the youth to become transformational leaders and active citizens. 3. i-Conserve
i-Conserve is the environmental protection and sustainability pillar of the Globe Bridging Communities, a strategic venture to characterize the commitment of Globe to business and environmental sustainability through the use of its ICT competencies. 4. i-Access
The i-Access pillar supports a portfolio of programs harnessing mobile and broadband technologies to improve access to and delivery of social services to help national government agencies, local government units and other
development players achieve equitable and responsive delivery of mandates to citizens and disadvantaged communities through sustainable and relevant ICT-enabled content and technology solutions. 5. i-Give
The program aims to mobilize Globe employees to be active citizens through volunteerism, whereby its employees are encouraged and supported to volunteer during relief operations, fundraising for Globe Bridging Communities projects, and mentoring the youth, teachers, micro-entrepreneurs, barangay leaders and other non- government organizations.
Globe BridgeCom Projects
Sagot Ka ni Kap! The “Sagot Ka ni Kap!” program hinges on the core business and competencies of Globe Telecom—mobile communication and broadband services. More than just equipping the community watch volunteers with mobile phones and hand-held radios, Globe also provides capacity-building workshops designed to inspire and enable them to be more proactive in community development. The workshop includes modules on community leadership, conflict resolution, and crisis management. The beneficiaries also receive a one-year comprehensive personal accident insurance package. The “Sagot Ka ni Kap!” program also strengthens the local security infrastructure and inspires the essential set of capabilities needed for effective leadership and at the same time, develop their capacities as future community leaders. My Fair Share ProgramIn 2012, Globe Bridging Communities inked partnerships with social enterprises Gifts & Graces Inc. to produce eco-bags for the Globe My Fair Share program. The bags are made by the Bulacan-based Kaibhan Women’s Association, Caritas Manila, and Pamana ng Pag-asa and are sold for ₱99 each. The program transforms the way Globe gives back—not only by aiding partners and beneficiary communities with capital, funds for capacity and skills development and ICT tools—but also by empowering them with livelihood opportunities and by bringing them into the Globe value chain.
Globe Cordillera Challenge 3 Bigger in scale than the previous Globe Cordillera biking events held in 2010 and 2011, the Globe Cordillera Challenge 3 targeted not only Globe employees, members of the media, and stakeholders, but also a broader audience of recreational bikers and triathletes nationwide to bike a total of 27 kilometer-trail along the Cordillera mountain range from Baguio City to Mount Cabuyao and Mount Sto. Tomas in Benguet. Together with Cordillera Conservation Trust (CCT), Globe Bridging Communities changed the game by creating three different bike trails following the theme, “Choose your trail, Bike your way, Save the Cordilleras”. Bikers were given the freedom to decide which route to take based on their skill level, bike discipline and bike set-up. Total registered bikers for the Globe Cordillera Challenge 3 reached 319, while 222 bikers were in attendance on the event day, May 5. The event raised a total of ₱800,000 from online registration, corporate sponsorship, and from the pooled donations of Globe Telecom employees’ own fundraising activities. The Globe Cordillera Challenge 3 also raised the bar in employee volunteerism: Globe Telecom bikers from Manila, Negros, and La Union joined the event in Baguio. Since May 2012, the Roots and Shoots nursery program of CCT has established seedling nurseries in twenty-one (21) public elementary schools in the Cordillera area.
Global Filipino Teacher (GFT) ProgramThrough the Global Filipino Teacher program (GFT), educators are trained to integrate ICT in teaching basic subjects like English, Science, Math, and heKaSi. GFT is done in partnership with the Department of Education (DepEd) and the Coalition for Better Education, a Cebu-based non-profit organization composed of various education stakeholders from the academe, students, parents, non- government and business organizations. The GFT training program equips teachers with knowledge using the project- based learning approach and will train 100 new teachers and existing GFT teachers to become peer coaches to their co-teachers on the use of project-based learning (PBL), creating a community-based ripple effect of 21st century learning.
Volunteaming. Volunteaming encourages employees to customize their volunteering projects and promote camaraderie in their communities of choice. As part of i-Give’s commitment to support corporate citizenship, Globe Bridging Communities matches the project with minimal funding. This project is open to all Globe employees nationwide who can form a group of five and is willing to commit eight (8) volunteer hours each. Volunteaming allows employees to be vigilant with the social issues of the communities nearest to them. They are able to customize the assistance needed according to the needs of their communities or charity of choice. Through volunteaming, Globe employees are given access to Corporate Social Responsibility projects regardless of their work location and expertise by simply volunteering their time and talents.