More than competence

Aboitiz Equity Ventures , Inc. chief executive officer Jon Ramon Aboitiz and chief operating officer Erramon Aboitiz have always been proud of getting the right people on board. Among their prized finds is Juan Antonio Bernad, AEV vice-president and chief financial officer since 1995.

Working closely with the Aboitizes in the executive team, Bernad seems to have succeeded where others have failed. That is, he has successfully balanced the publicly listed conglomerate’s commitment to achieve growth and its need to service debt.

Tasked with advising the AEV board and executive officers on strategic finance issues, Bernad helped craft policies that essentially allowed the group to "balance businesses that provide growth and those that provide a stable cash flow."

AEV has interests in power generation and distribution, food, transportation and financial services. Over the years, it has focused more resources in the power and banking sectors.

"The investing community was sending different signals. In the early years, we were criticized for being underleveraged. Now, it seems it wasn’t such a bad thing. The concerns of investors and the expectations of the shareholders are difficult to manage because they change over time," Bernad said.

In the near time, AEV’s investment policies will remain conservative. "We are not a large company. We have limited resources. We’re not suddenly going to depart from what we consider as optimal debt levels. If opportunities arise which are larger than what we can handle, we would look for partners and go for a joint undertaking," he said.

Bernad obtained a master’s degree in business administration from the University of Pennsylvania’s Wharton School. But while technical competence is quite important in fulfilling the job of CFO, he believes there is something greater required to do it well.

Corporate culture

"I was in the US for a seminar recently and one of the lecturers asked me the question, ‘Would I hire somebody from Enron?’ It was an interesting question because the implication is that Enron executives are aggressive, driven and very competent individuals. Yet, there is a question as to their integrity," he said.

"On the one hand, I know a lot of good people came from there. On the other hand, your problem is that people who work in an organization for a long time imbibe the culture of the company. Even if, on a personal level, you didn’t compromise your values, it may be difficult to change the culture in which you work. Each company is different but the key is to find people who will not only thrive in but will also support your corporate culture."

Core values

Being technically qualified for the job is no longer enough. A company saves itself a lot of problems in the long run if it hires young professionals who have developed early on, as individuals, integrity as a core value.

"I think an organization can’t function well if management can’t trust its people. It may not be wise to hire people whose measure of success is getting the deal done, whatever it takes."

The other issue is judgment. "You can teach people how to make more informed decisions. There are techniques for enhancing such skills. But I think there is an innate sense of either good or poor judgment and it can’t be taught."

Career path

Bernad, known in AEV as Cholo or Pocholo, began his career with Aboitiz Shipping Corp. "I remember going to the pier in the middle of the night. It was interesting and exciting work but it is more suited to young people who can extend their hours and still be fresh in the morning."

Bernad’s father and grandfather worked for non-Aboitiz electric companies. It, therefore, seemed like fate when he moved from shipping to play a role in the electricity businesses of the Aboitiz Group.

"Most businesses have an interesting element in them. You can’t put your energies in something you don’t like. Look for an industry you like. It will make it easier to handle disappointments–whatever the job is. When you run into problems and you find nothing you like in what you do, it would be very hard to continue."