Long known for her trailblazing work in eldercare, Mary Ann Tsao is changing gears next year to champion the sustainability cause at the helm of her family office
Dr Mary Ann Tsao is fired up. She’s wearing a scarlet dress for the photoshoot—a gift from her brother and a sartorial departure from her customary black garb. Change is afoot. Next year, she will step away from her work at the Tsao Foundation, a non-profit organisation dedicated to eldercare founded by her grandmother, to assume the mantle of chairwoman of the Tsao Family Council, the beating heart of the Tsao Family Office that is setting an example for driving positive social and environmental change.
“I don’t normally give interviews but I have something to share,” the 66-year-old says, the words tumbling out. “I want people with assets to know that they can make money and make a difference at the same time.” The vehicle is the family office. As it exists to manage family wealth, as long as the principals are not greedy for maximum returns in the shortest time, what’s to stop them from funding change for good?
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The Tsaos set up their wealth management platform in 2016 in Singapore to oversee the family’s liquid and property assets. (The family’s IMC Industrial Group, a maritime and industrial solutions provider, remains a separate entity.) After decades of prosperity from an empire that includes manufacturing and real estate among other business interests, the family believed they had enough wealth. With the blessings of patriarch Frank Tsao, they decided that the funds from the family office would not be distributed to members but used for the betterment of society and the environment. An investment strategy was devised that involved increasingly complex levels of “kung fu”, says Tsao, referring to its skill level.
The simplest move was neutralisation, born from a “do no harm” principle that led to the divestment of stakes in industries that are damaging to the environment and society. So coal, gold mines, tobacco and activities in conflict zones were out. A more complex endeavour was introducing ESG (environmental, social and corporate governance) to investments, as ensuring accurate reporting and measuring improvement in these areas were a challenge. The most difficult to execute, or the top-tier “kung fu” according to Tsao, was the investment in companies that can effect positive change and be profitable at the same time.
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To this end, the family office has hired an impact assessment officer to help it evaluate investment opportunities. The journey has just begun. Tsao says: “We aspire to 100 per cent impact investment, but we’re about 10 per cent, maybe more ESG, but the bulk of it is still in traditional investments, but at least, they do no harm.”
Yet, the Tsaos know the power of their wealth. Band with like-minded family offices and a market can be created for impact products. Tsao cites how a big private wealth management company she knew had to develop expertise of impact products because the clients demanded it. Thus, the more family offices reject socially and environmentally damaging investment instruments and ask for investments with a social mission, the more the market will respond.
The family is thus tapping into like-minded communities to learn more about the impact ecosystem and magnify their power for change through group action. Tsao is a member of the Family Business Network (FBN) Asia, a regional chapter of FBN International, a global private, non-profit organisation of family businesses. The chapter is committed to sustainable business practices. She says: “We’re reaching out to others investing in this space because they would know where the good projects and companies are.”