1 00:00:03,990 --> 00:00:06,390 Sean Aylmer: Welcome to the Fear and Greed Business Interview. I'm Sean 2 00:00:06,630 --> 00:00:09,959 Sean Aylmer: Aylmer. We have an investing interview with a difference today. 3 00:00:09,960 --> 00:00:13,529 Sean Aylmer: Future Generation is an ASX listed fund manager that offers 4 00:00:13,530 --> 00:00:17,609 Sean Aylmer: investors access to leading Australian and global fund managers, while 5 00:00:17,609 --> 00:00:21,390 Sean Aylmer: also supporting charities that help children and youth. It was 6 00:00:21,390 --> 00:00:24,450 Sean Aylmer: founded by Wilson Asset Management's, Geoff Wilson, a friend of 7 00:00:24,450 --> 00:00:27,240 Sean Aylmer: the podcast. He founded it back in 2014 as a 8 00:00:27,240 --> 00:00:30,150 Sean Aylmer: way for the funds management and finance sector to make 9 00:00:30,150 --> 00:00:33,299 Sean Aylmer: a difference. I wanted to take a closer look today 10 00:00:33,299 --> 00:00:35,399 Sean Aylmer: at how it all works, what it means for investors, 11 00:00:35,400 --> 00:00:38,940 Sean Aylmer: for fund managers, and who they're helping. Caroline Gurney is 12 00:00:38,940 --> 00:00:42,510 Sean Aylmer: the Chief Executive Officer of Future Generation. Caroline, welcome to 13 00:00:42,510 --> 00:00:43,200 Sean Aylmer: Fear and Greed. 14 00:00:43,680 --> 00:00:46,049 Caroline Gurney: Oh, thank you so much. I'm delighted to be here. 15 00:00:46,710 --> 00:00:49,770 Sean Aylmer: How does Future Generation work? Just explain it to us. 16 00:00:50,549 --> 00:00:55,020 Caroline Gurney: It's actually, it's quite a simple concept, but it's hard 17 00:00:55,020 --> 00:00:58,860 Caroline Gurney: I think for people to grasp it upfront. But we 18 00:00:58,860 --> 00:01:03,599 Caroline Gurney: are Australia's first listed ASX vehicles and we provide both 19 00:01:03,599 --> 00:01:09,000 Caroline Gurney: investment and social returns. We have shareholders' money, we have 20 00:01:09,000 --> 00:01:12,539 Caroline Gurney: between the two companies, one that invests in global equities 21 00:01:12,540 --> 00:01:16,020 Caroline Gurney: and one that invests in a Australian equities. We have 22 00:01:16,050 --> 00:01:19,590 Caroline Gurney: the best boutique fund managers managing the money on a 23 00:01:19,590 --> 00:01:23,640 Caroline Gurney: pro bono basis. That actually means we don't charge shareholders 24 00:01:24,059 --> 00:01:26,879 Caroline Gurney: any of the usual management or performance fees that you 25 00:01:26,880 --> 00:01:30,059 Caroline Gurney: usually have to pay to get access to them. And 26 00:01:30,059 --> 00:01:33,060 Caroline Gurney: that allows us to donate 1% of our net assets 27 00:01:33,120 --> 00:01:37,350 Caroline Gurney: under management to our not- for- profit partners. And that's 28 00:01:37,350 --> 00:01:40,589 Caroline Gurney: really amazing because if you add up the 1% that we've 29 00:01:40,590 --> 00:01:45,509 Caroline Gurney: been giving over the last eight years, we've now given 75. 30 00:01:45,509 --> 00:01:49,650 Caroline Gurney: 9 million to not- for- profits specializing in youth at 31 00:01:49,650 --> 00:01:53,940 Caroline Gurney: risk and youth mental health and prevention and wellbeing. Something we're 32 00:01:54,180 --> 00:01:55,500 Caroline Gurney: unbelievably proud of. 33 00:01:56,460 --> 00:02:00,210 Sean Aylmer: Okay. I think I'm repeating this to you but so 34 00:02:00,210 --> 00:02:02,670 Sean Aylmer: it's net assets, it's not net profit. It's actually if 35 00:02:02,670 --> 00:02:06,330 Sean Aylmer: you've got $ 100, 1%, so $ 1 of that is going to one 36 00:02:06,330 --> 00:02:08,070 Sean Aylmer: of these organizations. That's right. Is it? 37 00:02:08,550 --> 00:02:12,720 Caroline Gurney: Yes, it is. It is. And also shareholders get investment returns. 38 00:02:13,050 --> 00:02:15,780 Sean Aylmer: Right. If I want to invest, it's a LIC, is 39 00:02:15,780 --> 00:02:17,160 Sean Aylmer: it, Listed Investment Company? 40 00:02:17,460 --> 00:02:17,759 Caroline Gurney: It is. 41 00:02:18,090 --> 00:02:21,570 Sean Aylmer: I invest in that. I put my $1, 000 into Future 42 00:02:21,570 --> 00:02:27,420 Sean Aylmer: Generation Australia or Future Generation Global. I know that effectively 43 00:02:27,540 --> 00:02:31,679 Sean Aylmer: 1% of those net assets is going to help people 44 00:02:31,680 --> 00:02:34,530 Sean Aylmer: and then I get investment or returns. Where you can 45 00:02:34,530 --> 00:02:37,530 Sean Aylmer: do it, it's because the fund managers aren't charging fees. 46 00:02:37,530 --> 00:02:39,450 Sean Aylmer: Is that the arbitrage there? 47 00:02:39,780 --> 00:02:41,609 Caroline Gurney: Absolutely perfect. 48 00:02:41,699 --> 00:02:44,580 Sean Aylmer: Okay. You've made this money. How much did you say 49 00:02:44,580 --> 00:02:45,180 Sean Aylmer: you've given away? 50 00:02:45,810 --> 00:02:49,078 Caroline Gurney: Well, over the last eight years, 75. 9 million. 51 00:02:49,290 --> 00:02:52,020 Sean Aylmer: Wow. 10 million a year you're giving away. Couple of 52 00:02:52,020 --> 00:02:53,940 Sean Aylmer: questions. Who are the fund managers involved? 53 00:02:54,990 --> 00:02:58,499 Caroline Gurney: We have the great fund managers in Australia. For example, 54 00:02:58,829 --> 00:03:02,280 Caroline Gurney: if you look at all of those boutique fund managers 55 00:03:02,280 --> 00:03:06,090 Caroline Gurney: you can't actually get access to or they're closed. We 56 00:03:06,090 --> 00:03:10,108 Caroline Gurney: have Paradice Investment Management, we have Bennelong, we have Regal, 57 00:03:10,110 --> 00:03:13,650 Caroline Gurney: we have L1 Capital. And on the global side we also 58 00:03:13,650 --> 00:03:17,609 Caroline Gurney: have Cooper's. We have Antipodes, we have Hollow, Wisco Partners 59 00:03:17,850 --> 00:03:20,220 Caroline Gurney: and Lanyon just a name but a few. We have 60 00:03:20,460 --> 00:03:25,049 Caroline Gurney: 33 fund managers across both of our LICs managing shareholders' money. 61 00:03:25,620 --> 00:03:28,710 Sean Aylmer: Okay. And do they get on? This is just an 62 00:03:28,710 --> 00:03:31,258 Sean Aylmer: aside question, Caroline, because you're managing all these people and 63 00:03:31,258 --> 00:03:32,520 Sean Aylmer: they're not getting paid for it, are they? 64 00:03:32,700 --> 00:03:34,859 Caroline Gurney: No, they're not getting paid for it. Well, they get 65 00:03:34,859 --> 00:03:37,170 Caroline Gurney: on with us and that's the most important thing, and 66 00:03:37,530 --> 00:03:43,110 Caroline Gurney: I think for many of them it's philanthropic. It's where 67 00:03:43,110 --> 00:03:46,110 Caroline Gurney: they're making a difference. Yes, they're great to work with. 68 00:03:46,170 --> 00:03:49,200 Sean Aylmer: Okay. You've raised this money, almost $ 10 million a year 69 00:03:49,500 --> 00:03:52,170 Sean Aylmer: over eight years. Where does it go? Who are the 70 00:03:52,170 --> 00:03:55,800 Sean Aylmer: organizations that specifically that you're helping out? 71 00:03:56,730 --> 00:03:59,490 Caroline Gurney: You're right. Basically in terms of the Australian one, it 72 00:03:59,490 --> 00:04:03,270 Caroline Gurney: goes to youth at risk. For example, you've got Youth 73 00:04:03,270 --> 00:04:06,449 Caroline Gurney: Off The Streets, you've got Act for Kids, you've got 74 00:04:06,450 --> 00:04:11,100 Caroline Gurney: Australian Indigenous Education Foundation, you've got Lighthouse, which is about 75 00:04:11,100 --> 00:04:16,620 Caroline Gurney: homelessness. You have Mirabel, which is basically for young people 76 00:04:16,620 --> 00:04:19,590 Caroline Gurney: who has been disadvantaged by their parents or their carers, 77 00:04:19,980 --> 00:04:25,139 Caroline Gurney: dying of a drug overdose or something related. Really fantastic 78 00:04:25,139 --> 00:04:29,130 Caroline Gurney: organizations that really need money on a long- term basis 79 00:04:29,279 --> 00:04:31,678 Caroline Gurney: so they can actually do the job they're really good 80 00:04:31,680 --> 00:04:36,390 Caroline Gurney: at doing. And then globally that's more about prevention, wellbeing. 81 00:04:36,779 --> 00:04:39,510 Caroline Gurney: We have REACH out there, we have Mind Blank, which 82 00:04:39,660 --> 00:04:44,700 Caroline Gurney: uses drama and actors to act out difficult times in 83 00:04:44,700 --> 00:04:47,489 Caroline Gurney: children's lives so they can actually talk about it together. 84 00:04:47,730 --> 00:04:51,510 Caroline Gurney: We have Project Rocket, which is basically working in schools 85 00:04:51,510 --> 00:04:55,320 Caroline Gurney: and the girls that run that are amazing women who 86 00:04:55,320 --> 00:04:58,290 Caroline Gurney: are also on the board for a lot of the 87 00:04:58,290 --> 00:05:01,950 Caroline Gurney: big Google, et cetera in terms of helping them with 88 00:05:02,400 --> 00:05:05,370 Caroline Gurney: technology for young people and how to use it properly. 89 00:05:05,789 --> 00:05:07,950 Caroline Gurney: I can go through all of them. I mean we have 14. 90 00:05:09,630 --> 00:05:12,390 Sean Aylmer: I get the gist of it, so that's fine. Well, 91 00:05:12,750 --> 00:05:14,849 Sean Aylmer: how do you make sure that the money's being well 92 00:05:14,849 --> 00:05:18,420 Sean Aylmer: used? If I'm going to invest in the Future Generation 93 00:05:18,420 --> 00:05:20,940 Sean Aylmer: and I can buy into one of the ASX listed 94 00:05:21,360 --> 00:05:26,219 Sean Aylmer: funds, how do I know that the money is... I 95 00:05:26,220 --> 00:05:29,550 Sean Aylmer: mean, do you have some measure in terms of impact 96 00:05:29,580 --> 00:05:30,720 Sean Aylmer: that these charities have? 97 00:05:30,720 --> 00:05:34,380 Caroline Gurney: That's a really important question because we really want to be able to 98 00:05:35,040 --> 00:05:37,920 Caroline Gurney: measure the impact that our not- for- profits are having 99 00:05:37,920 --> 00:05:42,329 Caroline Gurney: on their audience. Say for example, for Future Generation Global, 100 00:05:42,600 --> 00:05:45,928 Caroline Gurney: we actually went out to the whole of Australia and 101 00:05:45,930 --> 00:05:48,450 Caroline Gurney: asked for applications for not- for- profits that we could 102 00:05:48,450 --> 00:05:51,660 Caroline Gurney: fund. And we now have 14 new not- for- profits 103 00:05:51,660 --> 00:05:55,200 Caroline Gurney: in that mental health prevention space. And we are measuring 104 00:05:55,200 --> 00:05:58,319 Caroline Gurney: their impact. We've actually let all of the not- for- 105 00:05:58,320 --> 00:06:02,279 Caroline Gurney: profits invest in what they want to invest in. They 106 00:06:02,279 --> 00:06:06,240 Caroline Gurney: don't actually have to create a vehicle for our money. 107 00:06:06,390 --> 00:06:08,579 Caroline Gurney: They can actually use the money for what they think 108 00:06:08,580 --> 00:06:11,640 Caroline Gurney: is the best thing, which we feel is really important. 109 00:06:12,059 --> 00:06:14,099 Caroline Gurney: And then we ask them to report on that and 110 00:06:14,099 --> 00:06:16,830 Caroline Gurney: to actually give us the number give of young people that 111 00:06:16,830 --> 00:06:20,730 Caroline Gurney: it's helped in various different forms for data. By the 112 00:06:20,730 --> 00:06:22,890 Caroline Gurney: end of this year, we'll be able to actually say, " 113 00:06:23,430 --> 00:06:27,630 Caroline Gurney: These organizations have helped XX number of young people and 114 00:06:27,630 --> 00:06:31,289 Caroline Gurney: they've helped them onto a path of whatever that might 115 00:06:31,290 --> 00:06:33,000 Caroline Gurney: be in terms of their metrics." 116 00:06:33,630 --> 00:06:35,428 Sean Aylmer: Stay with me, Caroline. We'll be back in a minute. 117 00:06:35,428 --> 00:06:45,720 Sean Aylmer: My guest today is Caroline Gurney, chief executive officer of Future Generation. 118 00:06:47,279 --> 00:06:52,409 Sean Aylmer: Given $ 80 million over eight years or thereabouts, it gives 119 00:06:52,410 --> 00:06:54,719 Sean Aylmer: us an idea about how big these funds are, but 120 00:06:54,720 --> 00:06:56,250 Sean Aylmer: can you just give us a bit more information on 121 00:06:56,250 --> 00:06:59,880 Sean Aylmer: that and whether they're growing? Whether Australians generally are seeing 122 00:07:00,029 --> 00:07:03,450 Sean Aylmer: it as a good way to be philanthropic and earn 123 00:07:03,450 --> 00:07:04,410 Sean Aylmer: investment returns? 124 00:07:05,099 --> 00:07:07,260 Caroline Gurney: In terms of what we are doing at the moment, 125 00:07:07,290 --> 00:07:09,540 Caroline Gurney: I mean we have over a billion, so it's approximately 126 00:07:09,540 --> 00:07:13,650 Caroline Gurney: half in each of the LICs. And that's pretty much constant. 127 00:07:13,650 --> 00:07:17,220 Caroline Gurney: It has gone slightly down because of what's happening in 128 00:07:17,220 --> 00:07:20,610 Caroline Gurney: global markets, but we anticipate that it will grow again. 129 00:07:21,000 --> 00:07:23,309 Caroline Gurney: And I just think the more we actually talk about 130 00:07:23,670 --> 00:07:25,889 Caroline Gurney: how we can make a difference in the community and 131 00:07:25,889 --> 00:07:29,520 Caroline Gurney: as well as giving shareholder returns, I think these vehicles 132 00:07:29,879 --> 00:07:33,630 Caroline Gurney: are just amazing ways to save for the long term. 133 00:07:33,720 --> 00:07:35,970 Caroline Gurney: I mean, that's what listed investment companies are very good 134 00:07:35,970 --> 00:07:39,149 Caroline Gurney: for. And also make sure you actually give hope to 135 00:07:39,150 --> 00:07:40,290 Caroline Gurney: so many young people. 136 00:07:40,679 --> 00:07:42,809 Sean Aylmer: Is Geoff Wilson still involved then? Geoff's been on our 137 00:07:42,809 --> 00:07:45,630 Sean Aylmer: show quite a few times. And people from Wilson Asset 138 00:07:45,630 --> 00:07:46,319 Sean Aylmer: Management have been. 139 00:07:46,350 --> 00:07:50,280 Caroline Gurney: Oh, Geoff is still very much involved. I mean, he's 140 00:07:50,280 --> 00:07:51,150 Caroline Gurney: obviously our founder. 141 00:07:51,330 --> 00:07:51,929 Sean Aylmer: Can't get rid of him. 142 00:07:53,400 --> 00:07:56,040 Caroline Gurney: Oh, no, no. We really, we do need him. I 143 00:07:56,040 --> 00:08:00,300 Caroline Gurney: mean, I think his insights especially into LICs in the investment 144 00:08:00,300 --> 00:08:03,119 Caroline Gurney: world are really important. But he's actually acting chair of 145 00:08:03,150 --> 00:08:07,290 Caroline Gurney: FGG and he's on both investment companies and he's also 146 00:08:07,290 --> 00:08:11,610 Caroline Gurney: obviously on FGX as well. Yes, he's integral in terms 147 00:08:11,610 --> 00:08:12,810 Caroline Gurney: of what we're trying to do. 148 00:08:13,290 --> 00:08:15,240 Sean Aylmer: It's a great way for people like Geoff and other 149 00:08:15,240 --> 00:08:18,900 Sean Aylmer: fund managers to give back because in some ways they 150 00:08:18,900 --> 00:08:20,879 Sean Aylmer: can go on boards or whatever, but they're actually using 151 00:08:20,880 --> 00:08:24,690 Sean Aylmer: their expertise to hopefully create money for good causes rather 152 00:08:24,690 --> 00:08:27,630 Sean Aylmer: than just giving money. It's a bit more value add or something. 153 00:08:28,290 --> 00:08:30,810 Caroline Gurney: Well, I think it's they're doing what they're really good 154 00:08:30,810 --> 00:08:33,450 Caroline Gurney: at. I mean they've performed over the long term and 155 00:08:33,450 --> 00:08:36,539 Caroline Gurney: we expect them to continue performing. But also, what they 156 00:08:36,540 --> 00:08:39,390 Caroline Gurney: do is they manage this money in their main fund, 157 00:08:39,630 --> 00:08:42,809 Caroline Gurney: so it's they've got skin in the game as well, 158 00:08:42,809 --> 00:08:46,440 Caroline Gurney: so they care truly about their performance. And by managing, 159 00:08:46,710 --> 00:08:50,849 Caroline Gurney: some of them are managing 40 million, different amounts, they're 160 00:08:50,849 --> 00:08:52,230 Caroline Gurney: giving a huge amount back. 161 00:08:52,950 --> 00:08:54,420 Sean Aylmer: You've been in the job for a few years now, 162 00:08:54,420 --> 00:08:58,559 Sean Aylmer: Caroline. And I've known you well before then. And this 163 00:08:58,559 --> 00:08:59,759 Sean Aylmer: is a bit of a change in tack for you. 164 00:08:59,760 --> 00:09:00,660 Sean Aylmer: Are you enjoying it? 165 00:09:01,200 --> 00:09:04,170 Caroline Gurney: I mean, I really love it. I really, I love 166 00:09:04,170 --> 00:09:07,890 Caroline Gurney: talking to shareholders. I love finding out why they invest 167 00:09:07,890 --> 00:09:11,309 Caroline Gurney: in Future Generation, what their aims are, what their inspiration 168 00:09:11,309 --> 00:09:16,049 Caroline Gurney: is. And also the fund managers, they're really interesting people, 169 00:09:16,049 --> 00:09:18,508 Caroline Gurney: and the fact that they want to do more and 170 00:09:18,990 --> 00:09:21,510 Caroline Gurney: do good is fantastic. And the fact that so many 171 00:09:21,510 --> 00:09:24,929 Caroline Gurney: people want to be involved with us and do it 172 00:09:24,929 --> 00:09:28,380 Caroline Gurney: pro bono, I mean that I think really shows that 173 00:09:28,380 --> 00:09:31,380 Caroline Gurney: there's a lot of hope out there and a lot 174 00:09:31,380 --> 00:09:32,039 Caroline Gurney: of goodwill. 175 00:09:32,790 --> 00:09:34,800 Sean Aylmer: Caroline, thank you for talking to Fear and Greed. 176 00:09:35,279 --> 00:09:36,660 Caroline Gurney: Thank you very much, Sean. Pleasure. 177 00:09:36,660 --> 00:09:40,890 Sean Aylmer: That was Caroline Gurney, CEO of Future Generation. This is 178 00:09:40,890 --> 00:09:43,230 Sean Aylmer: the Fear and Greed business interview. Remember, if making any 179 00:09:43,230 --> 00:09:46,290 Sean Aylmer: investment decisions, you should always seek professional advice for your 180 00:09:46,290 --> 00:09:49,290 Sean Aylmer: circumstances. Join us every morning for the full episode of 181 00:09:49,290 --> 00:09:52,410 Sean Aylmer: Fear and Greed, Australia's best business podcast. I'm Sean Aylmer. 182 00:09:52,650 --> 00:09:53,130 Sean Aylmer: Enjoy your day.