All of us in the philanthropy space (fund-raising, fund-receiving, grant-making, researching, etc.) look forward to the Australian Financial Review (AFR) that includes the annual BRW Rich List. But Friday’s edition (29 May 2015) was special – it’s not often that I receive such an immediate payback on my $3.80. The front page headline was “How Pratt was tempted to give it all away.” Right there, I was riveted! And I knew I wouldn’t need to buy my ritual morning java – no need for a heartstarter, so the coffee money was saved. Thank you, AFR.
It didn’t take long for me to realise that John Stensholt was using “give it all away” in a different sense to what I was hoping. The intended meaning was “selling up and moving on,” not giving all/most of one’s wealth away (either while one is alive or in one’s estate) to charities and good causes.
Fair enough. I can appreciate that many AFR readers are looking forward to selling up, going “S-R” (semi-retired) or “GF” (gentleman/gentlewoman farmer). And that they would be intrigued to learn what might have tempted one of Australia’s most successful entrepreneurs, Anthony Pratt, to “sell up”.
But, oh John, you are such a tease! For a minute there I was thinking I would need to dash a good news email off to Uncle Charlie (hero to Warren et al.) – he loves to hear any good news that relates to giving while living. Especially big news.
But, alas, that would have to wait. In any event, it (and the related cover story in the AFR Magazine) was a great read. And a fascinating narrative on how challenging it is for wealthy entrepreneurial families to remain wealthy and entrepreneurial down through the generations. I have sincere appreciation for what Anthony Pratt & co have accomplished both commercially and environmentally. And as far as giving goes, the entire Pratt family (and Visy) have a much-appreciated and long record of giving (both publicly as well as quietly), and of giving substantially. It’s a great success story, all around!
So Simon and Catriona Mordant remain (Please correct me if I am wrong…) our one and only ultra-high net-worth family to publicly commit to giving it all away to good causes in their lifetimes. And Andrew and Nicola Forrest remain our one and only family to commit to The Giving Pledge. But it’s a grand beginning!
And I smiled (many, many times) as I worked my way through this year’s BRW Rich List, and thought about all of the wealth (millions and millions) that so many of those listed have given away in their lifetimes – tangible financial gifts that have changed so many lives forever. And saved so many lives! Bravo to all you Big Givers!
The Sydney Morning Herald (29 May 2015, p 3) estimates that the combined wealth of Australia’s top 200 is approximately $A196,000,000,000 (one hundred and ninety-six billion Australian dollars). Any way you look at it, that’s a lot of money. If they all gave 1% of their net investable wealth (NIW) away every year, that would be approximately $A1,960,000,000 (one billion, nine hundred and sixty million Australian dollars) in charitable donations. Each year. Every year. For the rest of their lives.
And there is even more great news: Remember that annually giving away 1% of your NIW means that you will always have 99% of your wealth (always; by definition) and your primary home to live in (always, as long as you live). Imagine being one of the country’s greatest (annual) givers and only having to give away 1% of your wealth every year? Amazing! And still prudent. Conservative even. Certainly no risk of ever ending up down-market, that’s for sure!
But I think I hear a number of you mimicking Darryl Kerrigan in the background: Tell ‘im ‘e’s dreamin’.
OK, OK. How about if only 25% of the top 200 gave away only 1% of their NIW each year? That’s still a total of $A500,000,000 (five hundred million Australian dollars) a year to charities (and tax-deductible if given to DGRs)! And that’s from only 200 families. Out of 24 million people.
Give it some thought. Any give it some action. There are still a few days left in this tax year (ending 30 June 2015). Every $2 gift counts.
1 For the super wealthy, the difference, percentage-wise, between total net assets and total NIW (i.e. total net assets less the equity in their primary residence) is negligible.
A good read, Dave. Great to see you are still hard at it. The world is a better place because of the likes of you. RL