Thoughtful philanthropy

Philanthropy

Perpetual

The Kinghorn Foundation – established by Jill and John Kinghorn in 2006, recently passed $100 million in total philanthropic distributions paid since inception. That’s a big contribution to the community but it’s the thinking behind those numbers that highlights the power of a well-run charitable foundation.

When John Kinghorn sold a large business nearly ten years ago, it gave him the opportunity to take the big leap into philanthropy.

“This Foundation is a once-off,” says John. “Up till then we’d been reinvesting all our money back into our businesses. But when we decided to sell, Jill and I had to decide what to do with the money. We have more than enough to live on so it was time to put some of our money to work for others. ”

The Kinghorns worked with Perpetual, who helped them establish the Foundation as a Private Ancillary Fund (PAF)*, look after day-to-day administration and manage the Foundation’s investments. The Kinghorn Foundation was the largest PAF in Australia when established, and is still one of the largest private foundations in Australia today.

In a decade, the foundation has racked up some impressive numbers.

  • The initial sum (or corpus) was around $300 million
  • It’s now worth over $330 million.
  • Over its life to date the Foundation has distributed more than $106 million to charitable causes, with the majority of these funds distributed in the past six years.

“I like the fact we distributed $17 million this year,” says John, “and yet there’s still over $330 million working to generate similarly large distributions into the future. It’s a sustainable, long-term approach.”

While the numbers are impressive, Jane Richmond, Senior Philanthropy & Non Profit Services Manager at Perpetual says The Kinghorn Foundation exemplifies three best practice approaches to philanthropy – approaches that work for philanthropists big and small.


1. Clarity of purpose

When the Kinghorns set up their foundation, they chose to focus on four key themes.

Australian medical research – “This is a field where Australia punches above its weight,” says John. “And the people we’ve partnered with are intelligent and devoted to helping humanity through research. They’re really focused on getting a result and methodical about how they get there.”

Transparency in Government – The Kinghorn Foundation supports organisations focused on ethics and transparency in public policy.

Australian Youth – The Foundation supports a range of youth initiatives including educational and sporting scholarships.

Poverty – As an investor in two businesses in India, John has personal experience of what he calls the “mind-blowing poverty” there. The foundation has funded education and microfinance opportunities in Africa and India. John believes these are two of the strategies that most effectively move people out of poverty.


2. Work with the experts

According to Jane Richmond, the Kinghorns have built strong and trusted relationships with a number of charities. “Because they treat it like a partnership, and have a deep understanding of the charities they work with, the charities in turn can work to a long-term strategy and prioritise their funding. This allows them to concentrate on delivering services to their communities or investing in their own capability – their ability to do greater good over the long term.”


3. Measure and improve

“The other thing The Kinghorn Foundation does very well is get bang for their buck,” says Perpetual Senior Adviser, Jamie Cockerill, who leads a specialist team who advises The Kinghorn Foundation on the management of its investments.

“John’s business background is one reason for that – he understands the importance of working with organisations that have clear objectives, strong measurement and good management.


What’s next?

When asked about the future of the foundation, John talks about the importance of the investment strategy but also about the long-term nature of their approach. “We need Perpetual to make the investments work really hard,” he says.  “We aim to earn more than the annual distribution each year so the corpus will grow over time and provide more money for distribution in the future. When Jill and I go, I see our children and grandchildren sitting on the foundation’s advisory committee and focusing on the causes they feel strongly about.”

 

*A charitable trust structure where donations are generally tax-deductible, where the income of the fund is distributed to causes you decide on (often with the help of your family) and which can exist in perpetuity. 

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Perpetual’s Philanthropic Services are provided Perpetual Trustee Company Limited (PTCo), ABN 42 000 001 007, AFSL 236643. This publication has been prepared by PTCo and contains information contributed by third parties. It contains general information only and is not intended to provide you with advice or take into account your personal objectives, financial situation or needs. The information is believed to be accurate at the time of compilation and is provided by PTCo in good faith. You should consider whether the information is suitable for your circumstances and we recommend that you seek professional advice. To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this information. PTCo does not warrant the accuracy or completeness of any wording in this document which was contributed by a third party.