From shale gas to philanthropy

Business colleagues Jonathan Stewart and Graham Dowland have found two very different ways to make a philanthropic impact.

The sale of Perth company Aurora Oil & Gas for $1.8 billion in 2014 delivered a big windfall for its founding directors.

For chairman Jonathan Stewart, it was an opportunity to step up his family’s philanthropic activity.

The result was the establishment of the Jon & Caro Stewart Family Foundation, which has become a substantial supporter of multiple arts groups and charities in Western Australia.

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And Mr Stewart has chosen to go public with his philanthropic activity for one reason – to encourage others.

“If you want philanthropy to become the norm, then you have to be prepared to stand up and say you are doing these things,” Mr Stewart told Business News.

“So we are prepared to have our name put on things.

“In fact, I’d say we go slightly further than that; we are prepared to say early that we are involved, in the hope it will encourage others to get involved.”

In keeping with its name, the foundation is a family affair; Mr Stewart’s wife and four children are all on the board, while his colleague Graham Dowland is a director.

The two men still work together, as chairman and finance director respectively of Australis Oil & Gas.

Mr Stewart has a non-executive role, which means he is able to spend time (more than he originally anticipated) assessing arts and charity groups that are seeking financial support.

“The key aspect of due diligence is the people,” he said.

“Who’s doing the work, what’s their background, are they well organised, what’s their plan?”

Mr Dowland’s family has also established a philanthropic trust and additionally he is chairman of the BrightSpark Foundation, a long-running organisation that supports medical research
in WA.

He also holds a full-time executive role at Australis Oil & Gas and readily admits he doesn’t have the time to conduct due diligence on charities or medical
researchers.

One solution to this problem is to follow the lead of the Stewarts’ foundation.

The other solution, which he has applied at BrightSpark, is more fundamental.

A recurring issue in the charity sector, especially in the field of medical research, is the overlap between multiple entities pursuing the same goals in an uncoordinated manner.

While BrightSpark is a substantial entity, with about $5 million of capital, its board decided it was not sensible to continue operating independently. 

In 2015, it entered a strategic alliance with a similar but larger entity – the Raine Medical Research Foundation.

“The whole reason was efficiency,” Mr Dowland said.

“I said: ‘This is crazy. We’re doing exactly what the Raine Foundation does, but they do it better’.”

Mr Dowland said the decision to align with the Raine Foundation followed an extensive review.

“We did a review of all the research foundations in WA. They are all very good but the only one that was truly independent is the Raine Foundation,” he said.

“Even though UWA looks after their money, they are independent in how they allocate their own distributions.”

The Raine Foundation was formally established in 1957 after Perth widow Mary Raine bequeathed her property empire to The University of Western Australia.

Her property assets included the Wentworth Hotel in central Perth, site of the Raine Square retail development. 

The foundation has contributed more than $50 million to major research projects since inception, supported two centres of excellence and provided more than 500 fellowships and scholarships.

The foundation distributed more than $880,000 in the year to December 2018.

After all its distributions over the past 60 years, the foundation still has total assets of $40.9 million.

On that measure, it is the sixth largest philanthropic foundation in WA, according to the BNiQ database, and a good illustration of the long-term benefits that can flow from well-managed bequests.

Mr Dowland said the alliance had proved beneficial in two ways – BrightSpark’s capital is invested alongside Raine’s capital, and BrightSpark can tap into Raine’s expertise on research projects.

“Their network of peer reviewers around the world, we couldn’t find anybody else that did it as well,” he said.

“We’ve just lined up our own distributions with theirs. It’s very efficient and robust.

“They charge us next to nothing because they are achieving their goal of increasing the amount of money available for medical research.

“It’s worked very well.”

The alignment has extended to Mr Stewart’s family foundation; its funding for medical research goes through BrightSpark, which in turn goes through Raine.

“How am I meant to work out which piece of medical research is most valid?” Mr Stewart said. 

Outside of medical research, the Stewart family foundation aims to give about six substantial grants per year; its funding is usually multi-year so recipients can plan with certainty, and is made in partnership with others so it has more impact.

Mr Stewart is particularly attracted to programs that help organisations become more sustainable.

An example comes from The Fathering Project.

The Jon & Caro Stewart Family Foundation, in tandem with two other foundations, funded a research program designed to obtain empirical evidence to prove the effectiveness of the Fathering Project.

Armed with those results, they headed to Canberra.

“They have now got funding from the federal government, which has allowed them to go national,” Mr Stewart said.

He said the due diligence process had its own rewards.

“I find the interaction with the people very rewarding. It’s quite extraordinary what you see, how hard people work.”

Mr Stewart provides mentoring and guidance to grant recipients but has drawn the line at going on boards.

The beneficiaries of his family foundation have included Hope for Children (a school in Ethiopia) and Teach for Australia, which seeks to attract talented university graduates into teaching.

In the arts sector, the foundation has funded Broome-based publisher Mugabala Books, Sculptures by the Sea and the Lester portrait prize.

Other recipients include Anglicare’s Foyer Oxford.