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Investing in Zones of Conflict: A Sustainable Response to Attain Peace and Development


Shalom, Assalamu Alaikum, Peace of God Be Upon Humanity….. Good afternoon to everyone. First of all, I would like to express my sincere thanks to IFC for its having invited me to speak before you today.

Everyday, we see a lot of bad news on television, read discouraging news in the papers. Not many people have the chance to learn about the good news, thus as a consequence fail to take part in creating the good news. I am very honored to represent the Autonomous Region in Muslim Mindanao in the Philippines, and share with you some good news about Mindanao as opposed to the usual news about bombings, kidnapping, and the guerilla war.

You have seen my story in the video. It is not an extraordinary story. But, it changed the lives of thousands of people. It also made our shareholders get their money’s worth as we become one of the most profitable companies in the industry in the Philippines.

When I prepared for this most welcome engagement, I did some reading about IFC and the work that you do. What caught my interest was your mission statement that says ---IFC promotes sustainable private sector investment in developing countries to help reduce poverty and improve people’s lives. I told myself… why did I not know 8 years ago that such organization exists? This kind of organization is exactly what I was looking for. I wanted to change the lives of people, I have a business plan, I have some resources but practically no one understood what I was up to. The banks would not lend me money even if I can put up the necessary collateral because properties in Muslim provinces were and still generally are not, accepted as collateral. The risk is too high, I was told by the bank official. The rest is of course is history. By the Grace of the Almighty and I believe its time has come, I was lucky to find investors who took that bold step and leap of faith (those who thought otherwise, say “crazy enough”) to risk their money and their talents in the war-zone town of Datu Paglas. At this point in time, I take this opportunity to propose that IFC be involved some more in the sustainable economic development of the Philippine Muslim Region as a way to lasting peace, not just in the Philippines, but by way of helping combat terrorism in the Asia Pacific Region.

You are discussing Corporate Social Responsibility here. And although I don’t need to convince you to believe that there is clear business case to embrace the principles of sustainable development, I want to tell you that I knew nothing about it when we started developing the business in 1996. I just did what my elders, or should I say my stakeholders, asked me to do. My elders, and in particular my dear late uncle Hashim Salamat, former Chairman of the rebel group Moro Islamic Liberation Front who returned to our Creator 2 years ago, had three things to say which I then adopted as Guiding Principles, when I proposed to them my business plan:

  1. protect the environment at any cost because this is all we have for the next generation,
  2. do not abuse the workers, protect their rights and look after their welfare and safety, and last
  3. provide education for the children.

These three Guiding Principles, integrated into my basic personal responsibility to also wholeheartedly support the interest of my investors, seeked to ensure better attainment of the company’s CSR and sustainability agenda. You may appreciate knowing that my investors are working on Certifications like ISO 14000, Rainforest Alliance, SA 8000, OHSAS 18000, ISO 9000, HACCP, and Integrated Management Systems. Paglas Corporation is also a signatory to the Global Compact Initiative of the United Nations.

Principle 1, allowed us to operate in a way that is acceptable not only to our international shareholders while it also looked after my moral obligation to the community and the future generation, to ensure preservation of our resources. For me this is more than just a business case, this is very personal too.

Principle 2, allowed us to work within the parameters not only of government regulations but a commitment as well to the teachings of God, thru His different Messengers and lived by in different religions.

And the Third Principle, I will continue to invest in the future of our children. I believe and I have seen this myself ---- that poverty and economic inequality are a good breeding ground for terrorism. But a healthy and well-educated generation will be the most positive and powerful tool against terrorism. As the saying of the wise goes, we did not simply inherit this world from our parents, the better truth is that: we merely borrowed this from our children.

Through all these, I learned that a clear sense of vision and mission helps clarify and purify our intentions. Modesty aside, I was not born poor although ever since my younger days I had always found natural affinity with the house helpers, drivers and bodyguards of my parents. And because of that, I had seen the glaring divide that separated the Muslim nobilities from the common families. I protested the norms where the leadership of the ruling clans put their interest over the most basic concerns of those in poverty. As my father’s successor --- I vowed to use the influence of my family to make a difference in our community because I was tired of seeing the same vicious cycle of violence and poverty. I wanted to try something new because the traditional Muslim way of leading our people was not working. It worked for the elite Muslim families and the politicians. But it never worked for the people.

I also learned that in fulfilling my mission to BRIDGE the economic, social, and political divide among the tri-peoples in Mindanao (Muslims, Christians, and Highlanders), I knew I had to change the rules of the game. ? When the convention dictates that the Datus – or members of the local royal families --- are the only people who can make sound decisions for the people, I encouraged dialogue and consensus among local folks. By doing so, we share the accountability to make things work for all of us. ? Philippine Muslim culture is basically very exclusive. I challenged that by bringing everyone’s concerns on the table … the government, the military, the religious leaders, the workers, the rebels and even the lawless elements because I believe that what each of these groups say is of great value. ? We often had difficulty welcoming new ideas and new ways. We did not want outsiders in our territory. But again, this system did not work for us and therefore, I invited NGOs and the academe to work with us so that we could learn how to invest in our future through training, skills building, values formation and education. We built partnerships with as many groups as possible, regardless of culture, faith, ideologies, to hasten the progress we deserve and dreamed for. ? I was brought up in a culture where guns and goons define a Man’s status in the society. I challenged that convention. At first, I was not comfortable because it was “not the normal thing” to go around town without my bodyguards. But, I decided to put an end to that fashion because the old ways were not working for others and for me either. My personal campaign took a toll on me. I lost my father and 3 brothers due to violence and lawlessness, before I could demonstrate to the rest that we don’t need guns. Other traditional and political leaders are still relentless, but I keep the faith that in due time they will change.

Today we are starting to reap the fruits of our labor and faith for a better future. By way of infusing at least $400,000 dollars to the local economy every month in the form of salary versus almost nothing in the past --- we are able to change the picture of Paglas town from war zone to economic zone.

For me, the challenge is always HOW TO SUSTAIN THE GAINS. And my simple but honest response to this is to continue to LISTEN to what other people have to say --- and LEARN from the WISDOM of their stories --- as they gave me great inspiration to continue to improve, to be a BETTER leader.

The investment that we established in Paglas allowed us Muslims to prove our worth, whether it be as a leader, a follower, an employer, a worker, a professional, or simply as a responsible citizen in out communities. We earned the trust of our investors. A year ago, our investors conveyed their approval of up to U.S. $50 million additional investment to expand our operations to 2,300 more hectares in, to the surprise of many, the “risky” Muslim Area.

The expansion areas, just like Paglas years ago, have been in the headlines because of the armed conflict between military and the Moro Islamic Liberation Front, and plain lawlessness (for example, just 3 years ago, the Bumbaran town of Lanao del Sur province where our highland banana expansion is underway, there was a truckload of 20 Christian Settlers who were massacred there. Now, this town is looking forward to having its own share of peace and prosperity, for the benefit of their children). This new investment and development means employing at least 3,000 more people and I am glad to let you know that thousands of rebels took advantage of the opportunity to be in the mainstream workforce.

In closing, I must say that companies, big or small, have clear and obvious commercial interest as well as moral imperative to help build prosperous and peaceful societies. Please let me take this occasion to thank my foreign investors, Chiquita Brands International in the United States in particular, for their faith that Muslim areas in the Philippines can host foreign investments. Let me quote from a philosophy of the Philippine Business for Social Progress --- “our greatest aspiration is to see that the one true purpose of business is to make life good for everyone”. Thank you once again and let me take this opportunity to extend to you my personal invitation, for you to visit us in Mindanao, hopefully soon.