Pi­o­neer has a so­cial point to prove

The Weekend Australian - - BUSINESS - DA­MON KITNEY

When bil­lion­aire Paul Ram­say passed away sud­denly in May 2014 in his home town of Bowral, the chair­man and founder of pri­vate hos­pi­tal gi­ant Ram­say Health Care left a phil­an­thropic be­quest of more than $3 bil­lion to char­ity.

It led to the es­tab­lish­ment of the Paul Ram­say Foun­da­tion, the na­tion’s big­gest char­ity by as­sets, whose grants are funded from the div­i­dends of a cor­ner­stone share­hold­ing in Ram­say Health Care.

Bris­bane en­tre­pre­neur Al­lan English never met Paul Ram­say, but he helped pi­o­neer the phil­an­thropic model adopted by the late bil­lion­aire’s foun­da­tion through his hos­pi­tal­ity in­dus­try equip­ment rental and fi­nanc­ing com­pany known as Sil­ver Chef.

English, who hails from the West Aus­tralian wheat­belt, moved to Queens­land to start Sil­ver Chef in 1986. He floated the com­pany al­most two decades later in 2005.

In 2010 he and his wife Tessa started the English Fam­ily Foun­da­tion to hold part of his fam­ily’s share­hold­ing in Sil­ver Chef, us­ing the div­i­dends from the pub­lic com­pany to fund the foun­da­tion’s phil­an­thropic work.

Back then Sil­ver Chef shares were trad­ing around the $1.50 mark. By Oc­to­ber 2016 they had risen more than ten-fold to $11.74, which over eight years has al­lowed the fam­ily to dis­trib­ute al­most $11 mil­lion to char­i­ties and es­tab­lish a ven­ture fund to sup­port so­cial im­pact in­vest­ments.

More im­por­tantly English has be­come some­thing of a poster child for com­pa­nies and ex­ec­u­tives be­ing chal­lenged by the mantra of cor­po­rate so­cial re­spon­si­bil­ity.

“Cor­po­rates are seek­ing pur­pose. They are in­creas­ingly ques­tion­ing their so­cial li­cence to op­er­ate. There is an aware­ness that, ‘Gee whiz we have to start demon­strat­ing to the com­mu­nity that we need to take into ac­count what their needs are’,’’ English says. “I spend a lot of time work­ing with lead­ers who are in this tran­si­tion point — who are want­ing to add more mean­ing into their or­gan­i­sa­tions.”

Forty per cent of grants by the English Fam­ily Foun­da­tion are to fund mi­cro­fi­nance pro­grams in de­vel­op­ing coun­tries to al­le­vi­ate poverty. A fur­ther 40 per cent is chan­nelled into Aus­tralian-based so­cial en­ter­prises, and the re­main­der goes to a fam­ily fund.

English’s three chil­dren — Lon­don-based Clare, New York­based Ni­cholas and Mel­bournebased Rachel — also each have their own phil­an­thropic bud­gets.

“I would never have done the cor­po­rate jour­ney with­out the so­cial pur­pose. For me, you have to make money for a rea­son. Mak­ing money for money’s sake is a pretty hol­low ex­is­tence,’’ English says.

When the English Fam­ily Foun­da­tion be­came Sil­ver Chef’s largest share­holder (it has just over 10 per cent of the com­pany, while the fam­ily in to­tal owns 24 per cent), the Sil­ver Chef strate­gic lead­er­ship team went away on a re­treat where it re­solved to fund one mil­lion peo­ple out of poverty through mi­cro­fi­nance projects by the year 2020.

A year later Sil­ver Chef’s 350 staff in­creased that goal to 1.5 mil­lion. As of June this year, they have reached 1.3 mil­lion.

Eight thou­sand Sil­ver Chef cus­tomers with rental agree­ments have also agreed to add $1 a week to their con­tracts to con­trib­ute to the vi­sion.

Sep­a­rately the Fam­ily Foun­da­tion’s Ven­ture Fund — which takes on riskier in­vest­ments — has taken a stake in the na­tion’s first sur­plus food on­line mar­ket­place known as Yume, along­side the phil­an­thropic arms of the Fair­fax and Myer fam­i­lies.

The Ven­ture Fund is also back­ing an on­line univer­sity called Ubiq­uity Univer­sity, an ac­cred­ited global univer­sity de­signed for So­cial Im­pact. Some of its most im­por­tant work is in Sri Lanka, where it is part­ner­ing with one of the coun­try’s lead­ing ed­u­ca­tional agen­cies.

“Some of the in­vest­ment com­mu­nity feel very aligned to what we do, that is great. The ma­jor­ity are pleased that the lead­er­ship of the com­pany is com­mit­ted to a vi­sion and pur­pose,” English says.

But over the past year English has also re­ceived a bru­tal re­minder that for all his work in phi­lan­thropy, he re­mains the chair­man of a pub­lic com­pany. One that has hit tough times.

Sil­ver Chef’s bot­tom line plunged into the red last year af­ter the most tu­mul­tuous year in its 32-year his­tory.

The prob­lem has been the dis­trac­tions of its trou­bled GoGetta equip­ment fi­nanc­ing busi­ness, which was sold in April to al­low the com­pany to re­turn to fo­cus­ing on its core hos­pi­tal­ity op­er­a­tions.

“Hav­ing a so­cial pur­pose doesn’t make you im­mune to mis­takes and we did stuff up,’’ English says.

“We had to make a call be­cause we were miss­ing out on good op­por­tu­ni­ties over­seas be­cause we were fo­cused on the GoGetta busi­ness. We made the hard call and we are now in that space of re­build­ing the bal­ance sheet.”

Sil­ver Chef shares are now trad­ing at $1.66 — they were trad­ing above $8 a year ago — as the com­pany moves to cre­ate a sim­pler or­gan­i­sa­tional struc­ture while push­ing its ex­pan­sion into North Amer­ica and build­ing its dig­i­tal ca­pa­bil­i­ties.

But the fall in prof­its and div­i­dends has had a dev­as­tat­ing im­pact on the com­pany’s char­i­ta­ble work and the grant-mak­ing of the English Fam­ily Foun­da­tion.

“It means the amount we can give away is less. We have had to drop 40 per cent of our bud­get this year, which is ter­ri­ble be­cause there are plenty of causes that need back­ing,” English says.

But he is now con­fi­dent he has the struc­ture of the busi­ness right to con­tinue to pur­sue his fam­ily’s dream. And to prove his longterm mantra that so­cial en­trepreneurs can still make money.

“Rest as­sured I am spend­ing more time in the Sil­ver Chef side of the busi­ness now than I am in the foun­da­tion,’’ he says.

“So­cial pur­pose led busi­nesses his­tor­i­cally around the globe have al­ways de­liv­ered bet­ter re­turns for share­hold­ers than those that are sim­ply profit driven.

“My com­pany has proven that it can do that and we need to live up to that. We have done it in the past and we can do it again in the fu­ture.”


Sil­ver Chef founder Al­lan English: ‘Mak­ing money for money’s sake is a pretty hol­low ex­is­tence’


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