W. SyCip & Co. established in Manila
The year 1946 marked the beginning of SGV & Co.’s history. At the time when the Filipinos were preoccupied with rebuilding the country after World War II, Washington SyCip, armed with a keen business sense and a vision for this country, opened a one-man accounting firm.
The Philippine accounting profession was then dominated by foreigners, as the country was just starting to rise from the ruins of war. Determined to be the partner of business, Wash practiced unparalleled dedication to the profession and provided the highest quality of service to his clients.
As the number of satisfied clients grew, Alfredo M. Velayo, a boyhood friend with whom Wash shared his dreams, and Vicente O. Jose, an accountant with copious experience in tax work, were taken in as partners in 1947. The new partnership gave birth to SyCip, Velayo, Jose & Co.
Early on, the three partners assumed different functions in the Firm. Wash saw to setting up the long-range policies and plans, Fred oversaw day-to-day operations and Enteng became the one-man Tax Division.
In the following year, the Firm embarked on its first overseas engagement, heralding the Firm's forays into several other countries. Working in foreign offices gave staff the chance to hone their skills, competence and experience in dealing with different cultures.
To service more clients outside Manila at a lower cost, the Firm opened its first branch office in the southern city of Cebu. Five years after Wash set up his one-man office, the Firm had grown to 26 people.
1952 to 1956 - Establishing Identities
Taking the lead
The Firm pioneered the Filipinization of the accounting profession. The first step taken to achieve this end was to work out a merger with Henry Hunter Bayne & Co. (HHB), a firm which started its practice in the country in 1906.
In 1953, Thomas Farnell, a senior partner of HHB, decided to return to his homeland and sell his practice to two Filipino accountants – Arsenio Reyes and Ramon J. Gorres. After a series of negotiations between Wash SyCip and the two distinguished gentlemen, the two firms merged to form the largest accounting firm in the Philippines. From this relationship, SyCip Gorres Velayo & Co., the Firm’s current name, was derived.
As the demands of business became more complicated, the need for professionals with world-class capabilities became apparent. To ensure the continued development of its workforce, and to fill the gap between the academe and actual practice, SGV began a manpower development program through training and scholarships.
This five-year period was marked by a growing market for management consultancy services. Realizing the auspicious prospects in this line of work, SGV founded its Management Services Division, the first of its kind in the country. Artemio L. Raymundo, the Firm’s first scholar, together with Cesar E. A. Virata, then a promising new graduate, nurtured the Division in its early stages. Ray focused on finance- and accounting-oriented engagements while Cesar concentrated on management areas such as production and project feasibility studies. The division became known locally and internationally as SGV Consulting.
1957 to 1961 - Laying the Foundation
Training, excellence, growth
Even as SGV continued to attract the best graduates in every field, it remained actively committed to staff development, encouraging each staff to strive for excellence at all levels. The Firm’s first scholar returned to the country in 1957 and laid down the framework for SGV’s training program. In-house training was organized. Employees from all levels were encouraged to pursue higher studies or take up additional courses to develop their expertise. Scholarships to MBA programs locally and abroad were granted to deservin g staff members.
To ensure consistent above-par work performance and maintain client confidence, management standardized its audit procedures and developed a working paper model. To oversee the training of the audit staff and adherence to quality standards, the Firm established the Research and Training Division.
To provide more incentives to its increasing number of employees, the management inked a policy granting an annual health bonus. It also created the Loyalty, Special and SyCip awards in recognition of noteworthy achievements and length of service.
In 1958, SGV assumed the practice of British firm Fleming & Williamson, which was rated the second largest accounting firm in the Philippines. The Firm expanded further by establishing offices in Bacolod and Davao cities.
1962 to 1966 - The Asian Connection
Birth of an Asian Multinational
This period marked the birth of The SGV Group. In 1962, through mutual acquaintances, Wash SyCip met with T.N. Soong who owned a public accounting firm in Taiwan. The two gentlemen soon discovered that they had common ideas on the role of accounting firms in economically developing countries. Taking advantage of an economic boom in Taiwan in 1964, T.N. Soong & Co. and SGV joined forces by entering into a technical cooperation agreement.
The firms agreed to subscribe to the same high level of professional and ethical standards, share professional materials, ensure uniform training programs and consult with one another on matters of mutual benefit to their practices.
SGV continued to expand its local network with the addition of the Iloilo and Iligan offices. Meanwhile, the increase in people and facilities in the Manila office necessitated the Firm's transfer to a 14-storey building along Ayala Avenue in Makati City, the new hub of business and finance in the Philippines.
As SGV continued to expand its practice in the country, it kept abreast of developments in the international professional world. The Firm began correspondent relations with some of the leading firms in the West, among them Arthur Andersen & Co., Ernst & Ernst, Haskins & Sells and Arthur Young.
Also, in 1966, SGV institutionalized its social responsibility by organizing the SGV Foundation (SGVF). To this day, SGVF participates in the upliftment of the industrial and management sciences through financial support and grants for professioral and research chairs, scholarships and other programs.
1967 to 1971 - Looking Outward
Bridges across Asia
Inspired by the success of the tie-up with the Taiwan firm and Mr. SyCip’s concept of a regional organization of Asian professionals, Yukta Na Thalang & Co. — the No. 1 accounting firm in Thailand — became a member firm of the SGV Group in 1967.
Utomo Josodirdjo’s Kantor Akuntan Drs Utomo of Indonesia joined the Group in 1968, enabling the Group to participate in the bustling economic activity in Indonesia.
In 1970, the SGV Group further expanded its reach to include Singapore and Malaysia. The following year, the SGV Group penetrated the Vietnamese market through the establishment of SGV-Thuan & Co., the first auditing firm in the country to apply international standards. Another significant development was the setting up of a Management Service Division in each of the Indonesian, Malaysian, Singaporean, Taiwanese and Thai member firms. The move was in response to the growing need for consultancy services in the region. Meanwhile, to expand its area of operations, T.N. Soong & Co. established a branch office in Taiwan.
As the number of the SGV Group member firms increased, so did the need for a coordinating office increased. The SGV Group office was put up in Manila to ensure adherence to uniform standards of professional services throughout the network. An Executive Committee, comprised of managing partners of the member firms, formulated regional policies. The office was also tasked to oversee the requirements of the member firms in terms of manpower and facilities.
During this period, the SGV Group undertook its first projects financed by international development institutions. It also embarked on consulting projects for countries without member firm offices.
On the occasion of its 25th anniversary, SGV launched the Professional/Social Involvement Program (PSIP). Through the PSIP, the Firm donated professional services to non-profit, social and civic-oriented organizations.
1972 to 1976 - Economic Take-Off
In 1972, Wash SyCip passed on his responsibilities as Managing Partner of the Philippine member firm to two other partners — Roberto V. Ongpin and Rodolfo B. Jacob — and focused on his task as Chairman of the SGV Group. Each member firm progressed by setting up a consulting practice, establishing more branches, offering a broader range of services, upgrading facilities and expanding its workforce. During this period, the total number of personnel in the SGV Group reached 2,600 before peaking at 4,000 in 1983. To coordinate and streamline the different services provided to its client base, SGV developed the total team service approach. Major client groups were identified and teams of partners from all divisions developed service plans for each group.
During this period, the SGV Group gained accreditation from the World Bank, the Asian Development Bank and other similar institutions. The Group's accreditation may be attributed to its intensive involvement in International Development Projects (IDPs) in non-SGV Group member countries. One such IDP was the South Nyanza Sugar Project in Kenya in 1976.
The SGV Group organized a management consulting practice in Hong Kong, as it tried to gain a strategic position in anticipation of doing businesss in China . The Group also formalized a correspondent relationship with Seoul-based Ahn, Kwon & Co. to service the multinational and local firms operating in the country.
The turn of political events in Vietnam forced SGV-Thuan & Co. to discontinue operations. Mario Gutierrez, partner-in-charge of the Vietnamese office, was one of the expatriates who left Saigon before its fall to the communist regime.
By 1976, the member firms of the SGV Group — located in the Philippines, Taiwan, Thailand, Indonesia, Malaysia, Singapore, Korea and Hong Kong — constituted the biggest network of nationally independent professional firms in East Asia.
1977 to 1981 - Competitive Edge
Development through technology and linkages
In 1978, the SGV Development Center was inaugurated. It housed an array of modern facilities utilizing an open plan concept for office space. Among its features were a computer center and expanded training and audio-visual facilities. The Center became a popular site for a variety of activities including public seminars and numerous internal training programs for the Firm.
The Center also became the home of the Institute of Advanced Computer Technology (I/ACT) which was established by SGV in affiliation with the Control Data Corporation of the US. I/ACT became one of Asia’s leading organizations in the field of computer training.
Industrialization in most countries in East Asia paved the way for the SGV Group to establish and formulate tie-ups with reputable organizations. These links enabled the Group to enter markets it has not previously tapped. It was in this period that the full range of services (audit, management consultancy, tax advisory) was offered by most of the member firms to their clientele.
By this time, the SGV Group had firmly established itself as a strong regional organization and had acquired a reputation for quality, excellence and professionalism. It was more than ready to undertake expansion beyond East Asia.
SGV signed a contract with a large corporate group in Saudi Arabia to form SGV-Arabia Ltd. The office offered technical and advisory services. It also assigned staff to finance, accounting and administrative positions in public and private institutions in the Kingdom.
Although SGV partners had participated in international forums on an ad hoc basis for 30 years, it was only much later that their presence began to be identified with the SGV Group. Beginning 1977, the SGV Group religiously sent a contingent to periodic conferences of the ASEAN Federation of Accountants, the Confederation of Asian and Pacific Accountants, the ASEAN Chamber of Commerce and Industry and the Pacific Basin Economic Council. SGV maintained a high profile at such gatherings as partners often occupied prominent positions. In 1982, Wash SyCip was elected president of the International Federation of Accountants (IFA). He was IFA's first Asian president.
To be more responsive to the increasing sophistication of client requirements and the influx of new investments, SGV established its Project Development Services Group.
As the industry base of SGV’s clients widened, the Firm adopted an Industry Specialization Program. The Program was aimed at developing competency in different areas by compiling and disseminating relevant information, setting up specialized training programs and materials and establishing relationships with leading practitioners from each industry.
1982 to 1986 - Door to the World
Arthur Andersen & Co., S.C.
In 1982, Rizalino S. Navarro took over as Chairman and Managing Partner of SGV. During his 10-year term, he oversaw and guided the Firm through many changes, the most important of which was gaining a global partner.
In 1985, after four decades of regional expansion, the SGV Group member firms in Indonesia, Philippines, Taiwan, and Thailand became members of the Arthur Andersen & Co., Société Coopérative, also known as the Andersen Worldwide Organization (AW). AW was already the world’s largest professional service organization at that time, with operations in roughly 50 countries and a workforce of about 30,000.
"The association with AW was a big strategic step," Navarro said. "We chose AW because it was the best in IT and we knew that IT would be a critical competitive factor in our profession."
The relationship between the two organizations was mutually beneficial. The SGV Group served as AW’s link to East Asia while AW afforded SGV access to its highly advanced computer technology and training programs and to its international network.
In 1986, the Manila Advanced System Center and the Microcomputer Resource Facility were made operational through rapid technology transfer from AASC. Aided by computerization, SGV provided services to over 8,000 clients.
All levels of the organization benefited from intensive training. Formal training and international on-the-job experiences dramatically increased skills and enabled the Firm to deliver outstanding quality service in the field of technology.
1987 to 1991 - The Age of Globalization
A global firm
Heading into the '90s, SGV continued to expand its reach and services. The Firm’s scope of practice grew to include the whole range of audit, tax and consulting services using advanced technologies, methodologies and approaches for all industry groups within a worldwide network of offices, experts and resources while serving clients on a global scale from a solid Asian base. With technology from AASC, the Manila Advanced Systems Center has been developing software for the major firms in the US and Japan through satellite communications since 1988. SGV has also contributed to the AASC structu re by providing in-depth understanding of the firms.
SGV Consulting embarked on a major engagement in Ghana — one of thousands of International Development Projects SGV has undertaken since the early ‘70s throughout Asia and in other regions of the world. SGV also offered its services for investment in Vietnam once again.
Because of SGV’s indomitable leadership, its track record has remained unmatched in the region. It has accumulated various resources in its four-and-a-half decade of operations — competent staff, state-of-the-art facilities and an international network. The vision of SGV is not only to give value service to its clients but, more importantly, to become a partner in development of the country where it operates. The Arthur Andersen Worldwide Organization shares this vision.
1992 to 1996 - Birth of the New Economy
R. Navarro left SGV in 1992 to become Secretary of Trade and Industry under the term of Former President Fidel V. Ramos. Gloria L. Tan Climaco succeeded him to become the first female Chairman and Managing Partner of SGV. During her term, she led SGV in finding new applications for its expertise and challenged innovation from everyone. SGV was successful at offering consulting services in new and challenging areas — complex financial audits, mergers and acquisitions, debt-to-equity swaps, revolving trade facility arrangements, recapitalization, capital structuring, BOT projects, IPOs, asset securitization, privatization and foreclosure and bankruptcy proceedings. SGV was the first in the industry to provide corporate finance consulting and contract financial management.
The year 1996 marked the golden anniversary of the Firm. A milestone for the history of the Firm, the 50th anniversary was punctuated by month-long celebrations — including a grand alumni homecoming — and the release of the book, "SGV 1946-1996: A Gold Record". But what made the event most poignant was the announcement of Wash SyCip's retirement. After 50 years of nurturing and molding the Firm into the respected and exceptional institution SGV has become, Wash SyCip turned over the reins of managing the Firm to the new breed of SGVeans.
The year 1996 heralded the start of Carlos R. Alindada's term as Chairman and Managing Partner. This period in the Firm's history was a witness to economic and political upheavals as the world grappled with the challenges of a New Economy and as the Asian financial crisis impacted on all sectors and businesses in the region.
The Firm met these challenges head-on. Resilience, consistency and dedication were the elixir of SGV, as the years marched on.
1997 to 2001 - 55 Years of Leadership
Then Chairman and Managing Partner Cesar V. Purisima has said, "There is nothing more difficult to carry out, nothing more doubtful of success or more dangerous to manage, than to initiate a new order of things." Purisima knew whereof he spoke, as he introduced the concept of market circles and reorganized the Firm under a new structure. But change, in any organization, is inevitable. The only thing left to be done is ensure as smooth a transition as possible, with as little pain as possible. To this end, Purisima created a new committee tasked with making decisions on issues affecting day-to-day operation of the market circles and service lines.
2002 - A New Chapter Begins
In its bid to continuously provide excellent service to its clients, the Firm has seized the opportunity to affiliate with one of the world's premier organizations in the field of professional services. On 6 June 2002, the Firm signed a definitive agreement with EY International, making permanent the Firm's affiliation with the global EY (EY) organization. The move heralds the start of a partnership that champions a two-fold vision and strategy of People and Growth, while remaining true to SGV's strategy, culture and commitment to providing the highest quality of audit work and other services. Through this association, the Firm will move forward and look ahead to an even brighter future as a member of a premier organization with strong global ties.