Future Generation Global chairwoman Belinda Hutchinson and CEO Louise Walsh are concerned that mental health charities are failing to win over philanthropists.
Confusion, duplication and a lack of leadership is stopping wealthy philanthropists from donating more money to address the nation’s mental health crisis, according to a new report by companies backed by billionaires Andrew Forrest, Solomon Lew and a who’s who of corporate Australia.
The $950m Future Generation Group of listed investment companies, which harness the best ideas from top Australian fund managers and invest the proceeds into mental health and youth charities, commissioned EY to survey philanthropists and corporate foundations to understand why they are not doing more to support mental health.
The study found that while 85 per cent of private funders believe Australia is facing a mental health crisis, only 28 per cent directly and consistently invest in mental health causes.
Mental health charities rank 12th and receive a mere 4 per cent of the funding from corporate foundations, community foundations, family foundations and private charitable trusts.
“Significant structural issues in the mental health sector are deterring private investment. Private funders see the sector as rife with confusion, duplication and personality-based funding,” Future Generation chief executive officer Louise Walsh said.
The number of mental health charities has almost tripled since 2000 and there are now more than 575 mental health-focused charities registered in Australia.
Yet cancer charities receive $5 for every $1 received by mental health charities.
“It’s a wake-up call to private funders that we haven’t done enough in the space. We need to do more. In philanthropy you can’t wait for the government to do this,’’ said Herbert Smith Freehills partner and philanthropist Michael Gonski, the son of ANZ chairman David Gonski.
He said reasons for the funding gap could include the historical stigma of mental health and lack of wealth transitioning to younger generations in families.
“Perhaps it is that the stigma about mental health was much more prevalent for those growing up, who now have the ability to provide the funding,’’ he said.
The study found 55 per cent of funders not directly supporting the sector were open to funding the sector if they were given more clarity on the sector’s landscape.
One private funder of eight mental health charities undertook a review of the outcomes of its funding investment from 2016-18 and found only two charities rated “above-average” in showing robust evaluation methodologies with well differentiated outputs, impacts and reporting.
“Our biggest concern is to demonstrate outcomes. Our investors want to see a decent return in terms of social impact investing in mental health,’’ said Belinda Hutchinson, a Qantas director who is also chairman of the Future Generation Global Company.
The FGGC was established four years ago with the dual objectives of providing shareholders with exposure to selected global fund managers and changing the lives of young people affected by mental illness.
Ms Hutchinson’s own family has also been rocked by mental illness. “We don’t seem to have evaluation frameworks in the charities themselves showing results. We see a lot of the programs, especially around suicide prevention and the online apps, being developed but they are too similar. These groups need to work together and consolidate. There has been significant duplication of resources,’’ she said.
The FGGC will give away $5m to mental health causes in the year ahead, including the Black Dog Institute chaired by former GPT chairman Peter Joseph. It has already given away $9.1m.
The chairman of the Day Family Foundation, Geoff Day, said a key was to focus more private funding around prevention of mental illness.
“It seems the significant part of funding, mainly from government, goes to the person who has the health problem and I think more funds should be directed towards trying to find the solution to reduce the incidence of mental health,’’ he said. “We all go through life having to face curveballs, but we are never educated in schools on how to cope with them. Education is the key so we support positive education programs in primary and secondary schools.”
The $500m Future Generation Global Company is backed by the likes of BHP Billiton and Stockland director Carolyn Hewson, private equity doyen Bill Ferris, Gresham executive director Tony Berg, Airtree Ventures chairman Daniel Petre, former Newcrest executive Geoff Day and former SBS chairman Joe Skrzynski.
Its stablemate, the $450m Future Generation Investment Company, is backed by the likes of billionaires Andrew Forrest and Solomon Lew and the Victor Smorgon Group, David Paradice, Alex Waislitz and Neil Balnaves’s Balnaves Foundation. Both listed investment companies were founded by funds management legend Geoff Wilson.
by Damon Kitney.