Strategy, Sustainability and Risk
While economic development was greatly impeded in 2020, the importance of the water space remained critical. Communities clamor for the sustainable provision of basic utilities such as potable water and sanitation services. One of the most effective ways of protection against COVID-19 virus is through proper hygiene and cleanliness practices. The importance of disinfection efforts such as constant and proper hand washing was never more highlighted than at the onset of the pandemic. The challenge for water providers is to maintain a high level of service despite prevailing limitations.
Manila Water recognizes the importance of having sufficient water supply and sanitation services amidst the COVID-19 pandemic. The Company focused on maintaining service levels in its East Zone Concession and in its other operating subsidiaries. Key measures were undertaken to ensure that water and wastewater operations continued, while keeping employees safe from the dangers posed by COVID-19. At the same time, the Company remained true to its commitment to the United Nations Sustainable Development Goals (SDGs) on Clean Water and Sanitation.
Manila Water perseveres in the face of the COVID-19 pandemic for the welfare of its employees, customers, and stakeholders.
Sustaining water and wastewater service levels under the pandemic has been challenging, given the limited mobility and the need to comply with stringent health and safety standards. As the world slowly transitions to a new normal, Manila Water maintains its resolve to adapt to these new challenges.
OUTLOOK AND OPPORTUNITIES
Valuing Genuine Service
Manila Water remains focused on its service mission to provide exceptional service to its customers. The Company faces the COVID-19 pandemic head-on and is committed to perform even better, even as it strives to address the new realities brought about by social, environmental, and institutional challenges.
In response to the COVID-19 pandemic, Manila Water prioritized the safety of its employees as they continued the provision of genuine service to the Company’s customers. The safety and well-being of employees were upheld by Management by providing assistance such as transportation, access to healthcare and the adoption of alternative work arrangements. Equally important, the Company focused on business sustainability, prudently managing its financial resources to maintain service continuity, operational resiliency, and timely project implementation.
Ensuring water and environmental sustainability
Learning from the 2019 water crisis, the East Zone Concession’s focus in ensuring water supply stability to its customers reaped benefits as the Company maintained a 97 percent water supply availability in 2020. This was achieved despite limitations brought about by the pandemic. Moving forward, the Company will continue to pursue more water security and sustainability projects. Equally important, the Company maintained its service levels on its sewer and sanitation services and will push through with its wastewater coverage expansion projects. This continued focus is built upon the Company’s service mission to its customers. Over the next two years, water and wastewater infrastructure projects are expected to further ramp up in accordance with the Service Improvement Plan approved during the 2018 Rate Rebasing. The Company is likewise preparing for the upcoming 2023 Rate Rebasing. This important exercise will bridge the concession’s accomplishments and objectives towards achieving its service obligation targets in 2037.
In support of its commitment to water and environmental sustainability, the Parent Company successfully debuted in the international debt capital markets through the issuance of its maiden ASEAN sustainability bond. The 500 million US Dollar-denominated senior unsecured notes are pursuant to the Sustainability Financing Framework (SFF) recently established by Manila Water. The SFF is aligned with the Green Bond Principles 2018 and Social Bond Principles 2019 and likewise complies with the maiden ASEAN Sustainability Bond and SEC MC No. 8, s 2019. The proceeds from the issuance are intended to refinance maturing obligations and finance programmed water and wastewater capital expenditures for 2020-2021 and are targeted towards projects related to (1) Sustainable water and wastewater management; (2) Terrestrial and aquatic biodiversity conservation; and (3) Affordable basic infrastructure categories. The issuance recently received an accolade as the Best Sustainability Bond – Corporate in The Asset’s Annual Triple A Country Awards 2020.
Focusing on operational resiliency and efficiency
Beyond the East Zone Concession, financial resource preservation remained a priority. Specifically, MWPV exercised its option to borrow an additional Php3.0 billion from partner banks to ensure that sufficient resources are available for MWPV’s operations and capital expenditures, as well as for existing projects of subsidiaries and equity investments.
In terms of operations, new business development initiatives of the non-East Zone businesses gave way to keeping current operations stable and meeting service level standards. Taking the East Zone Concession as its benchmark for operating amidst the COVID-19 pandemic, the subsidiaries adapted to the new realities of their respective service areas. Notwithstanding the current challenges, the potential opportunities in the water space remain robust and Manila Water will continue to look at these as soon as the circumstances become better.
Digitizing for the Future
Amidst the COVOD-19 pandemic, Manila Water recognizes the need to fast track its digitization initiatives to increase efficiency, facilitate added convenience for customers, and minimize operational disruptions. The Company maximized its existing digital platforms, increasing usage and integration while maintaining information security. Furthermore, the Company introduced new digital platforms for its operations to increase ease of use, accessibility, and operational efficiency, regardless of the necessary changes in work arrangements. Manila Water continues to develop and strengthen its digital infrastructure to face the new realities.