Australia's richest not big givers to charity

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This was published 14 years ago

Australia's richest not big givers to charity

By Adele Horin

Australia's dozen or so billionaires fail to rate as serious philanthropists but 20 rich individuals together donated $40 million to a Sydney medical research institute, with one person contributing $25 million, a forum was told yesterday.

Bill Ferris, the chairman of CHAMP Private Equity and a companion of the Order of Australia for services to the community, said the future of philanthropy lay with rich individuals not corporations.

''Just as Bill Gates, not Microsoft, and Warren Buffet, not Berkshire Hathaway, have continued the North American private wealth-driven model of philanthropy, we need to see a similar model develop here over time,'' he said.

Mr Ferris is the chairman of the Garvan Institute of Medical Research, which in addition to the $40 million, raised $500,000 from several hundred other donors, $70 million from government, and less than $50,000 from corporations to build a new cancer research centre.

He was speaking at the launch of a report by the Australian Institute of Company Directors and the Commonwealth Bank that showed high numbers of company directors served on boards in the non-profit sector.

The Directors Social Impact Study, based on 1200 company directors in NSW and Victoria, revealed three out of five served on the board of a not-for-profit organisation and almost a third held more than one directorship.

Directors most commonly spent between six and 20 hours a month on board work, about double the time spent by the average volunteer. Three-quarters of directors did not receive director fees.

John Colvin, the institute's chief executive, said that a ''noblesse oblige'' among people with high levels of education and legal, governance or financial skills prompted many to give back to the community.

Passion for the cause and an invitation from the chairman were the main reasons the directors joined non-profit boards.

''Most directors say it's the hardest work they do but probably the most fulfilling,'' he said.

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Mr Ferris said ''none of Australia's dozen or more billionaires have yet seriously stepped up to the Australian philanthropic plate''. It was important when asking rich people for donations ''not to ask for too little … ask for one million, not $10,000,'' and ensure appropriate recognition.

He said it was ''politically correct'' to support the idea of corporate social responsibility.

But while companies should encourage director involvement in the not-for-profit sector, there was not a strong case for companies to give away large amounts of money.

''I'm not calling on corporates to do less,'' he told the Herald, ''but I don't think they're likely to give more than 1 per cent of net profits. Shareholders would jump up and down, and even some customers if they saw prices being forced up. There's a far more compelling case for directors themselves to do more.''

He believed a reasonable benchmark for annual giving for executives aged under 40 was 2.5 per cent to 10 per cent of pre-tax annual income; and 7.5 per cent to 15 per cent for executives aged over 40.

The philanthropist and businesswoman Janet Holmes a Court said corporate sponsorship was critical to arts organisations, such as the West Australian Symphony Orchestra, with which she is involved.

''But I have often wondered whether very highly paid chief executives of the companies which are so generous with their giving, give themselves,'' Mrs Holmes a Court said.

The entrepreneur and philanthropist Dick Smith said he gave away $1 million a year ''in order to feel good''.

If rich people were less secretive about their donations, capitalism may have a better name, he said.

DONATIONS

Average tax deductible gift - all Australians: $440

Average tax deductible gift - company directors: $1439

Average tax deductible gift - managing directors: $1884

Average tax deductible gift - millionaires: $48,548

Gifts as proportion of millionaires' taxable income: 1.37 per cent

SOURCE: CENTRE OF PHILANTHROPY, QUT

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