SINGAPORE (Dec 13): Like all family offices, the Tolaram Group family office, which manages the wealth of the Vaswani , Aswani and Adnani families (collectively the “Tolaram Family”), has its own investment arm. But since obtaining a capital markets services (CMS) licence in February, the Tolaram Group family office has transformed itself into a fund management company called Maitri Asset Management.
The Tolaram Group was founded by the father of its current chairman, Mohan Vaswani, who started a textiles trading business in Indonesia in 1948. Vaswani, who is over 80 years old, oversees the group, which has expanded to running a bank in Indonesia, supplying power in India, producing paper in Estonia and even building a port in Nigeria. The group also has a multinational food production and distribution operation, exporting to more than 75 countries.
Manish Tibrewal, CEO of Maitri, says the family office decided to become a fund management company, as it could offer its investing expertise to other wealthy families. “We thought that it might be a good idea to add value to other families in the region. [This is] either to help them structure [their investments] or provide similar investment [opportunities] because the investment philosophy of the families are similar,” he tells The Edge Singapore in a recent interview.
On Nov 20, Maitri launched the Sustainable Multi-Asset Absolute Return Strategy Fund (Sustainable MARS Fund), which aims to deliver stable risk-adjusted returns. The fund, Maitri’s first, seeks to invest in assets that adhere to certain environmental, social and governance (ESG) standards. The assets include equities, fixed income, derivatives, currencies and commodities. The fund does not invest in private equities.
Tibrewal says the fund takes a top-down approach and refrains from investing in companies that operate in certain sectors, such as tobacco and alcohol. Beyond that, it is free to invest in anything. “We not only focus on renewable [energy] or companies considered to be at the forefront of ESG but we also look at their contribution in terms of ESG.”
For example, a pharmaceutical company could be conducting cutting-edge research on drugs and making treatment more affordable. “That is making an impact on society. That really matters to us apart from financial returns,” he points out.
More specifically, the fund looks at ESG within two broad parameters, Tibrewal says. From a risk perspective, the fund evaluates all the potential ESG risks arising from its investments. This allows the fund to price those risks appropriately, he says. From a best practices approach, the fund identifies companies that are leaders in ESG. Citing a study conducted by international asset manager Robeco, Tibrewal says historically, companies that have strong ESG values have fared better than those that do not. In particular, the companies’ shareholder returns and operational performance were better.
So, why should wealthy families put their money with Maitri? After all, they could invest in a fund run by a professional asset management firm or engage the services of a private bank or multi-family office.
Tibrewal says none of them have “skin in the game” like Maitri. The Tolaram Family has invested US$100 million ($135.6 million) of its money as seed capital for the Sustainable MARS Fund. “Our investors’ pain and gain are very much aligned [with the Tolaram family’s]. That’s the big differentiating factor for us,” notes Tibrewal.
What’s in it for the Tolaram Family? Well, for one, Maitri has gained access to deals that are open only to institutional investors. “Our investment horizon has broadened,” Tibrewal says. Also, by having the CMS licence, Maitri has obtained higher credibility. “Once you get the asset manager’s licence, you become regulated by the Monetary Authority of Singapore, a well-respected regulator. That brings an additional level of governance to the family office,” Tibrewal points out.
He declines to disclose details on the number and identity of Maitri’s investors. But he says most of them are families from Southeast Asia, adding that the fund has also received interest from institutional investors, though it is still early days. Notably, 25% of earned capital goes to the Ishk Tolaram Foundation, which supports vulnerable communities in Indonesia, Nigeria and Singapore. The foundation is affiliated to the Tolaram Group.
Tibrewal, who is not related to the Tolaram Family, has worked at the Tolaram Group for 15 years. He started out in various roles at the company’s operations in Nigeria for five years, before taking on a corporate finance role at the company’s headquarters in Singapore in 2009. Six years later, he joined the family office. Tibrewal says he knew about the opportunity to work at Tolaram Group from a friend who used to work there. “At that time, I was not even thinking of moving out of India and leaving for Nigeria, of all places. It was a tough decision to make, but the job description was very good.”
Now, at Maitri, Tibrewal hopes to do more than just grow the wealth of the Tolaram Family and other investors. “We want to establish ourselves as leaders in responsible investing because we owe it to the world to [make] it a better place,” he says.
