UBS Puts Philippines’ Future in Peril with Investments in San Miguel

Days before the UBS Annual General Meeting, a civil society alliance is drawing attention to the major Swiss bank's investment policy in the Philippines. UBS is one of the biggest institutional investors in the Philippine conglomerate San Miguel. The group plans to significantly expand the capacity of its domestic coal and gas-fired power plants. In doing so, it is hindering the Philippines’ energy transition, a country with remarkable renewable energy potential according to a comprehensive study.^[1]

Other European financial institutions, such as the Austrian Erste Group and the German Deutsche Bank subsidiary DWS, have abandoned San Miguel, also citing climate protection concerns.^[2] UBS, on the other hand, holds $16.3 million worth of bonds in the power plant division San Miguel Global Power. This puts UBS in second place in Europe and sixth place worldwide among the top institutional investors in the San Miguel power plant division.

The investments flow through the following actively managed funds: 

• UBS (Lux) Bond SICAV – Asian High Yield: $15.3 million^[3]
• UBS (Lux) Bond Fund – Asia Flexible (USD): $1 million^[4]

Protests at the UBS Annual General Meeting | Lucerne, Thursday, April 10 @ 9 AM

A Philippine delegation will attend the UBS Annual General Meeting this Thursday, April 10, at the Messe Luzern to draw attention to the urgency of their concerns. The delegation's appearance will be accompanied by a photo op in which activists will roll out large exhibition photographs at the entrance to the meeting. The pictures show the unique biodiversity of the Philippine Verde Island Passage (VIP) and how San Miguel's liquefied natural gas business threatens it. The photo op starts at 9:00 AM on the Messe fairgrounds, Horwerstrasse 87, 6005 Lucerne. Journalists are cordially invited to attend the event. Photos will be made available promptly via a media release.

Quotes

Johanna Frühwald, finance campaigner at Urgewald, says: “While other European investors have dropped San Miguel, UBS is holding on to its dirty investments. This means that Swiss money props up a company that keeps tightening the fossil fuel grip on its own country. UBS invests exclusively in the group's bonds which means it has no strategic influence. Any semblance of the ‘critical investor’ who contributes to decarbonization is mere window-dressing.”

Asti Roesle, responsible for "Financial Sector and Climate" at Climate Alliance Switzerland, says: “The current political debate in Switzerland makes it clear: we urgently need strong, forward-looking financial regulation. UBS is resisting because of short-term profit strategies. But as long as investments in the expansion of fossil fuels remain unchecked, we are not only fueling climate collapse but also jeopardizing long-term financial stability.”

Father Edwin Gariguez, winner of the prestigious Goldman Environmental Prize and lead organizer of the "Protect VIP" campaign, says: “Exceeding the 1.5°C global warming limit threatens the survival of the Filipino people and other climate-vulnerable communities across the world. Instead of committing to the country’s climate and energy ambitions, companies like San Miguel traps the Philippines into reliance on dirty, deadly, and costly fossil fuels at the expense of livelihood and biodiversity. This is what it is doing in the Verde Island Passage, our Amazon of the oceans. Our planet’s lifeline is under threat, and leading these attacks are the fossil fuel companies enabled by the deep pockets of international banks. We urge UBS to cut ties with this dirty business.”

Background

With its investment in San Miguel, UBS is supporting a company that, apart from some smaller renewable energy projects, plays a central role in fossil fuel expansion in the Philippines. San Miguel currently operates more than one in five gas-fired power plants in the country – 8 out of a total of 35. It is planning 8 more, either alone or with corporate partners. In terms of power generation capacity, the company is responsible for more than a third of the gas-fired power plant expansion in the Philippines. The plans for 2 new gas-fired power plants along the Verde Island Passage (VIP), a marine strait known for its unique marine biodiversity, are particularly concerning. The power plants there are to be operated with liquefied natural gas (LNG), which brings with itself the construction of numerous LNG terminals on the coast. 

LNG is a particularly climate-damaging fuel due to the high energy input for liquefaction and regasification as well as methane leaks along the transport routes. The LNG boom threatens to exacerbate climate overheating in a country that is already suffering from increasingly frequent severe storms and flooding. At the end of 2024, an unusually violent series of six cyclones devastated large parts of the country.^[5] As a result of the storms, there were mass displacements and 174 people died.^[6] This development earned the Philippines the sad top spot in the current World Risk Index.^[7]

San Miguel's fossil fuel business is a burden on people and the environment alike. Recently, two oil tankers sank in Philippine waters, both chartered by a San Miguel subsidiary according to media reports. As a result, oil spills have polluted waters and coasts. ^[8]