Philanthropy is an inevitable topic when it comes to wealth creators in Western Australia.
When the person at the top of WA Business News’ wealth creators list, Andrew Forrest, has a stake in Fortescue Metals Group currently worth $5.7 billion, you have to wonder how much he is giving away.
Mr Forrest is the only Western Australian listed in Fundraising Research and Consulting’s Australian Philanthropy top 100 list (which compiles information on those who have given more than $1 million) to donate more than $50 million.
Mr Forrest is joined on the list by private wealth creators Ralph Sarich, who has gifted more than $10 million, Jack and Eleanor Bendat, with more than $5 million, and Dale Alcock, also more than $5 million.
Mr Forrest gifted more than $50 million in shares to various Australian and international charities earlier this year, after stepping down from his role as chief executive of FMG.
He has donated $6.7 million to WA’s four major arts companies (WA Opera, WA Symphony Orchestra, WA Ballet and Black Swan State Theatre Company), and the Art Gallery of Western Australia’s Future Fund.
Murdoch University’s Institute for Immunology and Infectious Diseases received $1.3 million from the billionaire.
On average, Americans give 10 per cent of their salary to charity but Giving West chief executive Kevin MacDonald believes this is an unrealistic figure for Australia.
Mr MacDonald said there was large scope for an increase in philanthropic giving in Australia.
Giving West aims to promote a strong culture of giving and philanthropy in WA through connecting givers and potential givers, peer-group learning and sharing.
Mr MacDonald said the average amount a chief executive or managing director, with an average salary of $400,000, gave in 2008-09 was $4176 or 1.8 per cent of income, referring to Queensland University of Technology’s research into Australia’s philanthropic giving rates, broken down by occupation.
He said different strategies should be employed to encourage giving in WA, given the circumstances around the wealth in the state.
“What is specific about WA, is it has fairly recently acquired wealth, except for the Hancocks and Perrons and others,” he said.
“It is the last 20 years mostly and people have been reinvesting their money into growing their businesses and they haven’t really started to think about what they will do with it philanthropically until the last couple of years.
“The other thing is, that so much of what has happened in terms of wealth creation was, and still is to a certain extent, paper based, it’s not so much cash profit.
“What that means is that we should be encouraging those organisations, particularly mid-tier miners here, to donate shares in their organisations.
“In the hands of the charity those shares can either be cashed or the charity can live off the income of the shares. And, of course, if you are gifting shares at 20 cents a share and they have capital growth to $2 a share, you are bequeathing to the charity much more than you would be in a cash amount.”
Compiling comprehensive information on philanthropic giving in WA is difficult, mostly because it’s done privately. But shifting WA’s ‘culture of fear’ when it comes to disclosure of charitable giving and philanthropy would have benefits, according to Mr MacDonald.
He had seen disclosure grow in the past 12 months and said it could lead to encouragement of giving and could also highlight the importance of giving.
Other wealth creators from the directors’ list that have been more open about their philanthropic activity include Seven Group Holdings chairman Kerry Stokes and iron ore billionaire Gina Rinehart.
Ms Rinehart supports human rights organisation South-East Asia Investigations into Social and Humanitarian Activities (SISHA), which fights people trafficking. She is also financing an arts centre for Aboriginal groups in Port Hedland through Hancock Prospecting.
Mr Stokes has been a long-time supporter of Telethon and last year contributed $1 million on behalf of his private company, Australian Capital Equity, as well as donating through his newspaper groups.
