Business families contribute over 70 per cent of the global GDP with 7,300 family investment offices managing investable assets worth S$7.9 trillion (US$5.9 trillion). There is a growing momentum among global business families to transform their business practices, channel investment capital toward sustainable and impact driven solutions, as well as engage in strategic philanthropic giving for positive social change. 

Sukanto Tanoto’s adage, “It is not the strongest who survives, but the one who adapts to the changing environment”, directly inspired the younger Tanoto to respond to climate and environmental issues. He joined the business in 2013 and for the next two years, helmed the development and implementation of RGE’s sustainability framework with a strong commitment to achieving zero deforestation.

Eighty-five per cent of the energy used for running paper mills belonging to pulp production companies APRIL and Asia Symbol (members of RGE) comes from renewables, making both companies on track to achieve net zero emissions by 2050. Says Tanoto: “As a family business, we adopt a business model that is built to last and thrive for multiple generations. Because we take a long-term view, the decisions we make will be focused on the value we can create, not just for the next one or two years, but for the next generations.” Naturally, that includes taking sustainability seriously as operators in the global bioeconomy.

Besides their corporate business, the family’s Tanoto Foundation, founded on the belief that quality education has the power to offer equal opportunity to all, has also recently expanded its impact-based programmes across China, Indonesia and Singapore. In particular, the Foundation supports healthcare and medical research on diseases prevalent in Asia. Growing their efforts to meet long-term social needs is possible through the quality healthcare and research ecosystem in Singapore, which recognises the potential of businesses as a force for good. “We leverage partnerships out of Singapore as a biomedical hub to pilot select health and medical interventions that are scalable to the region,” Tanoto explains.
 

2. Creating Impact through Family Capital

There is great potential for business families to deploy capital externally to drive change in sectors including sustainable agriculture, renewable energy, microfinancing, as well as improving access to basic services like housing, healthcare and education. Impact investments present a S$16.2 trillion (US$12 trillion) global growth opportunity toward achieving SDGs.  Yet, family offices account for only four per cent of the impact investment market which is valued at S$1.567 trillion (US$1.164 trillion).

In Sweden, the Knut and Alice Wallenberg Foundation and the Wallenberg family’s remaining 15 philanthropic foundations have been a source of indispensable funding for basic research and education, distributing around S$328.5 million (US$244 million) annually to these areas.

Through board work, the family plays a central role in the Wallenberg ecosystem. “As engaged and long-term owners, 100 per cent of the dividends of our ownerships goes back to the foundations. We are trying to help find long-term solutions by supporting basic research and education for the betterment of Sweden and society at large, ” shares the Wallenberg Foundations chair Peter Wallenberg Jr. The Foundations fund Sweden’s largest research project, the Wallenberg AI, Autonomous Systems and Software Programme (WASP), with over 5 billion Swedish Krona. WASP’s research community includes five universities and over 60 companies across the globe.

Family philanthropists — together with the wider philanthropic sector, are multiplying collaborations. Communities such as the Asian Venture Philanthropy Network or Temasek Trust’s Philanthropy Asia Alliance, support thought leadership and capacity building to catalyse collective action and enable scalable impact.
 

3. Creating Solutions by Tapping on Family Connections and Influence

Many, if not all, global issues require cross-border and cross-sectoral approaches involving partnerships with multiple stakeholders. This is where the connections of business family members come into play. Take for instance, The Giving Pledge, that was created by Warren Buffett, Melinda French Gates and Bill Gates. To date, over S$1.35 trillion (US$1 trillion) has been pledged by more than 230 signatories from 28 countries.

The Climate Leadership Initiative (CLI) was founded by experienced climate funders and philanthropists who saw a funding gap to support the transitions needed across sectors to address the climate crisis. With its deep network of peers, experts and scientists, CLI advises philanthropists on proven and promising climate solutions to help donors get started quickly and at scale.

Public-private partnerships are needed more than ever to tackle systemic challenges and advance economic opportunities for all. The Singapore Economic Development Board introduces family businesses to a wealth of resources — from supportive networks to vibrant investment opportunities — to help them venture into Asia. Learn more here.