Inter-Pacific Asset Management fund: Making money and creating social impact

KUALA LUMPUR: Four months ago Inter-Pacific Asset Management Sdn Bhd launched Malaysia’s first Social Enterprise and Responsibility Fund, an idea which has been 10 years in the making.
The InterPac Social Enterprise and Responsibility Fund offered by Inter-Pacific Asset Management is the brainchild of its CEO Lim Tze Cheng (pix), who conceived, conceptualised, structured and finally launched the fund.
The idea came when Lim, who has always been actively involved in social and charity work, started thinking of ways to create a sustainable way to generate income to fund his social work, so that it does not depend on his income.
“I always give a portion of my salary to social work but it reached a point when I started to ask myself, if one day I lose my job or I retire and have no more income, how do I continue giving? I cannot let that (charity work) be dependent on my salary.
“Secondly, you want to give more but it is dependent on salary increment. Despite you wanting to give more, you are only able to give more based on the increment rate. In 2007 I was thinking, how do I go about this? How do I solve this issue? Then it came to my mind, why not do it differently?” he told SunBiz.
That’s when Lim came up with the idea of investing in a fund to grow his income, contribute part of the profits made to charity and social work, and reinvest the balance of the profit.
“In the long term, I’ve actually created a sustainable vehicle or charity fund. Because once it grows, it is no longer dependent on my income. I can work or don’t work, it doesn’t matter because it is an investment, it can generate its own income. The key word is sustainable,” he said.
And while a social enterprise concept such as this would have been a tough sell in a profit and returns driven industry, Lim found in Tan Sri Vincent Tan Chee Yioun, a philanthropist himself, a like-mind who was very keen on launching the fund.
Tan is the founder of Berjaya Corp Bhd, the parent company of Inter-Pacific Asset Management. Lim, who previously worked at another asset management firm, joined in December last year.
The InterPac Social Enterprise and Responsibility Fund is an open-ended fund that invests in equities listed in the local and Asean markets except for those involved in gaming, alcohol and tobacco.
The fund will disburse 20% of the gains in cash back to investors, for them to use as contributions to charities and social enterprise projects of their choice while the remaining 80% will be reinvested back into the fund.
“Currently we have raised over RM4 million. Actually our return since April is 20%,” said Lim.
He said the fund is structured in a way that allows investors to use their returns for causes that are closest to their hearts.
“Some people want to contribute to church, contribute to temple, build a school, or help an old folks’ home. Secondly, no matter where you stay, you just draw a radius of 5km, there are bound to be some old folks’ home or orphanage with very few occupants and these are the people who get zero airtime. Whether they are in need of help, nobody knows.
“But you as a person living in that area, you would know. You can take this amount and do what you wish, you might want to help them refurbish their kitchen or you may want to help them in other ways. What I’m doing is localising the impact,” he added.
Lim said response to the wholesale fund has been good and there has been feedback from retail investors asking for a similar fund for retail participants. However, Lim said it will focus on growing the current fund before embarking on a retail version.
The InterPac Social Enterprise and Responsibility Fund has the same structure as any wholesale fund, with the only difference being the concept of encouraging people to contribute to society.
The perpetual fund has no lock-in period and investors can take out their investments partially or fully at any time, with no penalties incurred.
“We want to do the right thing by investors,” said Lim.