UNION CHRISTIAN COLLEGE

Widdoes Street, City of San Fernando, La Union

NAME: Joseph D. Brabante

SUBJECT: Management 6
SECTION: BSA-II
PROJECT: CASE STUDY ANALYSIS
TOPIC: CORPORATE SOCIAL RESPONSIBILITY
________________________________________________________________________

SM BAGUIOS CONTROVERSIAL SKYPARK and PARKING COMPLEX

PROJECT

INTRODUCTION
BAGUIO, Philippines While almost the entire nation's attention was focused
on the visit of Pope Francis, residents of Baguio City woke up on Saturday, January 17 of
this year to discover that SM Baguio had decided to cut 60 trees surrounding the mall for
its expansion.
Baguio residents had fought hard to save the trees. More than a hundred residents
and groups from the country's summer capital filed two environmental complaints and a
contempt charge against SM Baguio in 2012.
They clinched a temporary victory when the Baguio Regional Trial Court issued a
temporary environmental protection order (TEPO) against the plan to earthball trees in
April 2012, but the same court dismissed all their petitions in December 2012. There are
no longer any legal impediments that would stop SM from cutting down the trees after
the Court of Appeals affirmed the real time clocks (RTC's) dismissal of the cases and
lifting of the TEPO in December 2014.
In a statement issued Saturday evening, SM Supermalls president Annie Garcia
said the mall has secured all the necessary permits for the planned expansion project. The
cleared space will be the site of SM Baguio's "green" Sky Park, Garcia said.

The event was not a very pleasant endeavor to the appetites of the nations people
especially for the citizens of Baguio who have longed to save the trees for almost 3 years
now. What drove Shoemart Supermalls (SM) to engage in such action probably was their
curdled ambition to open up more space for their customers vehicles to park in,
increasing the corporations profitability in Baguio itself.
The city being the summer capital of the country accommodates a great
percentage of tourists especially on holiday seasons and on its annual Panagbenga
Festival. Traffic has long been an issue when people talk about the city of pines
specifically on these great occasions. SM having observed and endured this for years
might have sparked them to come up with the Skypark and Parking Complex Project, to
take advantage of such special events.
However, whatever the ends of SM are they surely have stained the curtains
of their corporate social responsibility. What lies now is that will SM ever regain the
trust from the citizens of Baguio by proving that this project is the real deal? Or will
this case like any other corporate cases be buried and forgotten through time,
leaving a scar on the hearts of the people?

STANDPOINT FOCUS
Leave the Trees !!!
The controversial plan of SM Baguio to transplant 182 trees is bound to fail
and will be harmful to Baguio in the long run, experts said.
"Pollutants are concentrated in the area so there must be a concentration of
vegetation. Trees intercept and absorb pollutants, told by Prof John Tacloy, professor at
the Benguet State University College of Forestry.
The Luneta Hill area from which the trees will be moved is one of the few areas
in the city where patches of trees remain.
In a statement posted on his Facebook page, Dr. Michael Bengwayan, Director of
the Cordillera Ecological Cordi Eco-Center Pine Tree, said, "One pine tree or alnus tree
absorbs an average of 40 to 45 lbs of carbon a year. The 182 trees are contributing to the
reduction of an average 8,790 lbs or carbon in the atmosphere yearly."

Bengwayan added that "the trees give us oxygen to breathe. If the 182 trees are
cut, balled or harmed, we are losing 546,000 lbs of oxygen a year which is the equivalent
need of some 866 people in a year."
Trees hold water
He also explained how the trees hold water and prevent water run-off. "An
average 10-year-old tree holds some 1,500 to 2,000 liters of water. Thus, the 182 trees
store as much as 364,000 liters of water. As the trees grow, they lose the water,"
Bengwayan said.
Transplant Shock
"When a tree is dug for transplanting, more than 95% of the absorbing roots are
severed. With less than 5% of its root system remaining, the newly transplanted tree
suffers from water stress," Bengwayan explained.
Bengwayan added that uprooted trees are also subjected to stress-related problems
due to tremendous root loss, a condition called "transplant shock," which can kill them.
In a study conducted by Tacloy on the effects of root-pruning to Benguet pine
seedlings, he observed that it is relatively practical to earth-ball pine trees during the
seedling stage when they are less than one meter high.
The study revealed a 50% survival rate for transplanted pine seedlings. But
experience has shown that the survival rate for earth-balled full timber is way lower at
17%.
Scientific processes
According to Bengwayan, "a tree with a diameter of more than 15 cm has less
survival chance. In the late 1990s, some 497 pine trees were earth-balled by Camp John
Hay Development Corp but only less than 20% survived and those not dead are showing
signs of deteriorating."
Citizens Say They are Pro-Trees
The citizens fight to stop the cutting or earthballing of the trees has long
started about 4 years ago. The National Union of People's Lawyers (NUPL) on behalf
of concerned Baguio citizens are the main people responsible in opposing the expansion
project of SM Baguio. Specifically what was opposed was the clearance signed by
Department of Environment and Natural Resources Secretary (DENR) Ramon

Paje, DENR Regional Executive Director Clarence Baguilat issuing the tree cutting,
pruning, and earth-balling permits of the SM Development Corp (SMDC) on Oct 27,
2011 to pave the way for a parking complex.
The NUPL filed the complaint last February 23, 2012 on behalf of the Cordillera
Global Network, Cordillera Peoples Alliance, Cordillera Indigenous Peoples Legal
Center, Cordillera Ecological Pine Center, and other concerned citizens of Baguio. They
urged the environment court to:
a. Set aside as null and void the permit granted by Paje to SMIC
b. Set aside as null and void the building permit issued by the City Building and
Architecture office in favor of SMIC
c. Permanently enjoin SMIC from cutting and/or earthballing the 182 pine and alnus
trees, and make the TEPO permanent
TEPO due in April 10, 2012 Considered Extended Until April 13, 2012
Not only for 3 days but until their complaint is heard. Baguio protesters scored
another legal victory in their fight to save trees that will be cut to give way to an SM
mall's parking facility and entertainment plaza in the country's summer capital.
At 5 pm on Friday, April 13, Judge Antonio Estevis, presiding judge of the
environmental court of the Baguio Regional Trial Court Branch 5, issued an order
extending an April 11 temporary environmental protection order (TEPO) that stopped the
cutting of trees on Luneta Hill in Baguio City.
Estevis heard the "very urgent motion to extend TEPO" filed by the National
Union of People's Lawyers (NUPL) on behalf of concerned Baguio citizens opposing the
expansion project of SM Baguio.
Complainants cited as basis of their motion the "extreme urgency to prevent
Defendant SMIC [SM Investments Corporation] from continuing its earth-balling/treecutting operations." This urgency, they said, was "still clear and apparent."
"Unless the Temporary Protection Order dated April 10, 2012 is extended, the
Plaintiffs will suffer grave injustice and irreparable injury before the matter could be
heard on notice, for the reason that Defendant SMIC even defied the Temporary
Protection Order when it was, in fact, already effective from the moment SMIC received
a copy of it," the complainants argued.

The DENR reported that 40 Alnus and one Benguet pine tree on Luneta Hill had
already been cut or earth-balled.
The environment court ruled to extend the TEPO, which expired on Friday, April
13. The TEPO will remain in effect until the case, which is still pending in court, is
resolved. The case was filed against Environment Secretrary Ramon Paje, Director Juan
Miguel T. Cuna of the Environmental Management Bureau, Public Works and Highways
Secretary Rogelio Singson, and SMIC.
SMS Stand on the Issue
SM responds
The cutting of the trees clears the way for a Sky Park that will feature
environment-friendly facilities, SM Supermalls said.
Read SM's statement below:
On December 2014, the Court of Appeals affirmed the Regional Trial Court's dismissal
of the environmental cases filed against SM and lifting of the Temporary Environmental
Protection Order paving the way to do our Sky Park project in Baguio.
The project will also feature green facilities to help absorb the impact of climate change:
a Sky Park, which features green walls consisting of live plants that will help improve air
quality, making the mall both relaxing and enjoyable for the whole family. It also consists
of a sewerage treatment plant (STP), and an underground rainwater catchment tank in
the basement. The excess space of catchment tank will provide additional parking space
that will help decongest traffic along Upper Session Road.
SM mall in Baguio has secured the final approval and necessary permits for this project
from the pertinent agencies. Prior to this, inputs from various community groups have
been gathered and considered. The project affected 60 trees.
Why Get Rid of them? Not Preserve them ?
Sunstar Publishing What compelled SM to pursue the project was the
power of nature itselfthe environment.
The project has been inevitable for years now, even to the point of being
obligatory. Beside the existing SM mall is one hectare of slope being eaten away by soil
erosion. Experts have urged SM to stop the erosion through modern preventive structures,
such as those on steep sloping terrain in Switzerland or Hong Kong.

On the slope are precisely those 182 trees. SM has been reinforcing the ground for
years to prevent them from falling. All of a sudden, the same trees have become the
subject of loud public protest that attracted extensive media coverage. How dare SM to
want to transfer those trees to another site in its 8-hectare property!
The soil erosion actually endangered all those 182 trees, and they could be
uprooted in one major landslide, forcing SM to spend P1.2 billion to try to save them
through a scientific technique called earth-balling and thus create the free space for the
anti-erosion structure.
When SM decided to build the structure, the group had two choices: cut down the
trees or transfer them. In fact, a renowned urban forestry expert, Armando Palijon, who is
a professor in UP-Los Baos, reportedly recommended that SM simply harvest the trees.
A doctorate degree holder, Palijon is the same expert who oversaw the earthballing of century-old acacia trees in a construction project in Cebu City to save them.
SM commissioned him to study the Baguio project. He recommended the harvesting of
the trees, because the SM property was not an environmentally critical area. He also
noted that it was neither a heritage site nor a historically significant area.
It was argued that SM would still have more than enough space in the property as
green space even with the construction of anti-erosion structures at the slope. Records
showed that SM would still have five hectares of open space, or more than 60 percent of
its property, while the law required an open space equivalent to only 30 percent of the
property.
More than a year ago in 2010, SM decided to build the structures to stop the
erosion. Since SM would do the construction anyway, Baguio City officials suggested
that SM incorporate in its plan a parking building to ease the traffic on the main roads of
the city.
Moreover, to put in its project the label green construction, SM
hired consulting groups from the United States that provided the planning for a so-called
LEED certification, which has been the global standardthe ultimatein green
construction.
For more than a year, SM worked to secure permits from the DENR and the Baguio
LGUs, including the barangay. It held public consultations, holding exhibits and
presentations, involving the Baguio media as well. Thus, it seemed to SM that all the
groups that mattered in Baguio really understood the plans. Involved in the project from

the start was the Baguio Regreening Movement, considered the largest environmental
group in the city, or perhaps even the most credible, which reportedly did not object to
the plan.
As part of the project, SM committed to maintain more than a thousand trees in its
Baguio property, plus it would plant 50,000 trees more in the next three years. This would
be on top of saving those 182 trees from certain destruction due to soil erosion.
TEPO lifted December 03,2012
Judge Antonio Estevez of Branch 15 of the Baguio Regional Trial Court,
dismissed all petitions, saying that while he joins the sentiments of the complainants, he
is bound by his duty to apply laws based on circumstances and evidence.
"The City of Baguio has been the residence of the undersigned for almost 20
years. Its people, the way of life in the City, and its environment, including its trees, have
become a part of his life. However, the undersigned could not give priority to these
factors," Esteves explained in his decision.
The ruling, issued on December 3, lifted the temporary environmental protection
order (TEPO) that stopped the removal of the trees on Luneta Hill.
The TEPO was released by Judge Cleto Villacorta in the absence of Esteves on
April 10 in the wake of protests sparked by SM Baguio's decision to start uprooting trees
to construct a 4-story commercial building and a 5-story parking structure in the area.
Negative environmental effects?
In his ruling, Esteves pointed out that the complainants failed to establish the following:

Resorting to administrative procedure would cause great and irreparable damage

There was any violation of due process

Exhausting administrative remedies would be moot and academic

No other plain, speedy and adequate remedy was available

There was strong public interest to justify court intervention

Deciding on "the most significant issue raised" -- whether the project will have an
adverse environmental impact, Esteves sided with the respondents that included DENR
Secretary Ramon Paje and the SM Investments Corporation.
"Several witnesses and the EPRMP (Environmental Performance Report and
Management Plan) prove that the expansion project properly addresses potential negative
consequences that may arise therefrom," Esteves argued.
"While admitting that the cutting or earth-balling of said trees will indeed have a negative
effect on the environment, the evidence adduced by the defendants would show that it
will not result to irreparable injury to the environment and detrimental effects to the
residents of Baguio," Esteves stressed.

CONCLUSION
SMIC will surely continue engaging this project until it is done, and through
power they will push their legal requirements to be held up on the court in time. It is too
late now to reverse the damages brought by the project to the environment and to the
people.
Combine the peoples grievances, ongoing court hearings, rallies and the rage of
environmentalists, this situation really has put SMICs image regarding corporate social
responsibility to a depression.
It is clear that there are profitability ends on this project .We cannot take this fact
away from every campaign that profit-corporations do. Anyway whats important for us
now is that things like this must benefit both the people and the environment.
It is true that SMIC made all the legal requirements needed to make the project
possible and it even coordinated with the environmentalist groups in the city before
starting project: It held public consultations, holding exhibits and presentations,
involving the Baguio media as well. Thus, it seemed to SM that all the groups that
mattered in Baguio really understood the plans. Involved in the project from the start was
the Baguio Regreening Movement, considered the largest environmental group in the city,
or perhaps even the most credible, which reportedly did not object to the plan. However
in the end, SMIC made this pacts quite non-sense because of their sudden action of
cutting down the trees amidst the popes visit. What happened was like a silent

execution, it is like SMIC relayed to the people that they were planning to do this from
the start.
SMIC proposed clear alternatives to withstand what their project have come to
ravish. Earth balling was one these promising things, yet there was no clear distinction of
how many of the trees were earth balled. Instead, more trees are reported to be cut down
than earth balled. Reforestation was also discussed, but we all know that it takes years
for the seedlings planted to flourish and replace what has been cut down. Moreover, not
all the seedlings planted can grow up to full-size. Most of them are not safeguarded and
left alone in the wild to survive by themselves, to die, or to be eaten by animals.
The Skypark, is the most promising alternative that was given. I think if it goes
well, SMIC has a chance to deviate the peoples perspective of what they have done.
Regarding the issue of soil erosion on Luneta Hill, isnt it ironic that with 182
trees standing on the said place, erosion could take place? I think reversed psychology is
being used with the people here. Isnt it more logical to add more trees than to totally
eradicate them all to prevent the soil erosion? We all knew that man-made structures in
preventing soil erosions are not as effective as what nature can offer. We often have
witnessed ripraps, seawalls, and other soil erosion counters getting washed up in the news
and in some of our local communities. These structures could even lead to harm to the
people for they are more dangerous when they are eroded by landslides, plus the fact that
there are going to be buildings at the top of these structures.
As long as SMIC do not cater to the taste of the people, it will be pouring more
salt to the wounds it has already acquired in the long-run. People are different nowadays,
not like long ago where feed of information is suppressed and people are ignorant. It is all
different now because of technology. SMIC has no loopholes to go into, he has got to
face the people.
SM Baguio and the peoples showdown are on hold for now:
SM CITY Baguio was ordered to stop the tree-cutting and balling activities in
Luneta Hill.

On Tuesday, the Supreme Court en banc issued a temporary restraining order

(TRO) against the decision of the Court of Appeals dated December 12, 2014.

Acting on the Petition for Review on Certiorari with Prayer for TRO and Writ for
Preliminary Injunction from the Cordillera Global Network, the court granted the TRO
and required respondents to comment on the petition of CGN within ten days from notice.
"Effective immediately and continuing until further orders from this Court, you,
respondents, your agents, representatives, or persons acting in your place or stead, are
hereby enjoined from enforcing the assailed Court of Appeals Decision dated December
12, 2014 in CA-G.R. CV No. 100245, implementing the assailed expansion plan, and
performing any cutting and balling of trees in Luneta Hill," the TRO read.
Aside from the SM Investments Corporation, respondents include Department of
Environment and Natural Resources Secretary Ramon Paje, Department of Public Works
and Highways secretary Rogelio Singson, Department of Environment and Natural
Resources-Cordillera executive director Paquito Moreno and Mayor Mauricio Domogan.
CGN went to the Supreme Court after the Court of Appeals decided December last year
to dismiss its petition, ruling, "The appeal lacks merit."
The decision said the appellants lacked proof to support their claim that the
appellee failed to comply with requirements for its expansion and appellants lacked proof
of damage of the planned expansion to the environment.
In a statement, SM Prime Holdings, Inc. said it has yet to receive a copy of the
TRO from the high court.
However, it stressed, "Rest assured that SM will comply with the directive of the
Supreme Court."

Recommendations
1.) Formulation of a strategic plan to achieve a set of objectives each year for the
restoration of environmental assets SM has harmed until their full restoration.

2.) Assured completion and accuracy of what the Skypark has to do so. (A Sky Park,
which features green walls consisting of live plants that will help improve air
quality, making the mall both relaxing and enjoyable for the whole family)
3.) Full payment and compliment to the contingencies that has arisen.
4.) An open forum with SM Baguio and the active groups against them.
5.) Consult more specialist who could offer better solutions for finding the
alternatives for the lost pine trees.

References:
http://www.rappler.com/nation/81139-sm-uproots-pine-trees-baguio

http://www.rappler.com/nation/998-earth-balled-trees-harmful-to-baguio?
cp_rap_source=yml#cxrecs_s
http://www.rappler.com/move-ph/17923-baguio-folk-vow-to-take-sm-to-high-courtover-trees?cp_rap_source=yml#cxrecs_s
http://www.rappler.com/nation/3823-court-extends-sm-baguio-tepo?
cp_rap_source=yml#cxrecs_s
http://kickerdaily.com/sm-uproots-pine-trees-for-sky-park-project-in-baguio-city/
http://www.wheninmanila.com/amid-popes-visit-pine-trees-in-baguio-wereallegedly-cut-to-give-way-to-sky-park/
http://smsupermalls.com/smbg/index4.html
http://www.sunstar.com.ph/baguio/local-news/2015/03/25/sc-issues-tro-vs-sm-399457