Future Generation Investment Company, a venture where high profile fund managers run investment funds on a pro bono basis, will donate $1.64 million to Australian charities this reporting season, after posting $11.4 million in net profit in the year ended June 30.
Future Generation was the first listed investment company (LIC) on the Australian Securities Exchange to channel some of its profits to charities, aimed at improving the lives of vulnerable children.
The LIC, which gives investors access to established fund managers such as Paradice Investment Management and Bennelong Funds Management, posted gains of 4 per cent since its inception in September 2014. The result beat the S&P/ASX All Ordinaries Accumulation Index’s 0.82 per cent returns during the same period.
“In a challenging investment environment, the 16 fund managers together delivered 3.2 per cent of outperformance with half the volatility of the S&P/ASX All Ordinaries Accumulation Index,” said the company’s chairman, Jonathan Trollip.
The company declared a dividend of 2¢ per share. The fund managers who lend their expertise to this LIC manage the company’s capital at zero cost.
Geoff Wilson, founder of the Future Generation Investment Company, said: “In establishing [the company] we asked Australia’s prominent fund managers to manage investors’ capital in their flagship funds without charging management or performance fees. FGX would not exist without them. On behalf of the company, its shareholders and Australia’s future generation, we cannot thank them enough,” Mr Wilson said.
Future Generation will donate about 1 per cent of its net tangible assets to Australian charities each financial year.
“FGX demonstrates how a vehicle focused on wealth creation can also generate social returns. We are pleased to see the vision of FGX come to fruition. The $1.64 million inaugural donation will contribute significantly to creating a brighter future for Australian children at risk,” Mr Trollip said.
Mr Wilson has also established an international variant of the Australian LIC, the Future Generation Global Company, with a focus on charities tackling mental health issues.