Andrew and Nicola Forrest donate $5 billion in Fortescue shares

Andrew “Twiggy” Forrest, Australia’s richest man, and his wife Nicola have donated 220 million Fortescue shares worth nearly $5 billion to their philanthropic foundation Minderoo.

The former Fortescue boss and his partner gave one fifth of their shareholding in the iron ore miner to the foundation, bringing its endowment to about $7.6 billion.

Andrew Forrest and his wife Nicola signed a pledge to give away most of their wealth in 2013.Credit: Kate Geraghty

The Minderoo Foundation was established by the Forrests in 2001 and is aimed at supporting initiatives including ocean research, ending slavery and supporting cancer and community projects.

In 2013, the Forrests were the first Australians to sign Bill Gates’ and Warren Buffett’s The Giving Pledge, through which they committed to give away most their wealth in their lifetimes.

In the 12 months to June 30, 2022, the Minderoo Foundation was the second-highest philanthropic spender after the Yajilarra Trust run by MYOB founder Craig Winkler and his wife, Di, according to data compiled by JBWere Philanthropic Services for The Australian Financial Review.

Andrew Forrest said the foundation’s wealth would be used to deepen its focus and make a greater impact in the face of looming global challenges, such as climate change and economic disruption.

“As our world faces enormous challenges, we have elected to continue to use our material wealth to help humanity and the environment meet these existential risks,” he said.

‘If you happen to be good at accumulating wealth, then I believe in using that skill for the greater good.’

Andrew Forrest

As of May, Forrest was the second-richest person – after Gina Rinehart – in Australia, worth $33.3 billion.

“Accumulating wealth should only be a small part of a person,” Forrest said. “Their contribution to their family and society is way more important. If you happen to be good at accumulating wealth, then I believe in using that skill for the greater good.”

HLB Mann Judd tax consulting partner Peter Bembrick said while the donation would likely be tax-deductible, it would also be subject to capital gains tax.

“The Forrests would probably get a large tax deduction because Minderoo is a qualified charity, but they’ve also handed over significant wealth,” he said. “Even if it’s a donation, and they don’t receive cash for it, it’s still a disposal of shares, so capital gains tax would apply.”

Bembrick said if the Forrests had held the shares in their own name for more than 12 months, they would receive the capital gains tax discount of 50 per cent.

While Bembrick said he would need more details about the Forrests’ personal circumstances and the donation to be certain, he said the tax deduction for the donation would potentially offset the capital gains tax.

In 2020, the couple donated $520 million to support the purchase of health equipment during the pandemic, tackle plastic pollution in oceans and provide bushfire relief, which brought their total donations to the foundation to more than $2 billion.

Nicola Forrest said it was a tough time for many people, and the latest donation would help provide more significant, focused support, and ignite purposeful action to help vulnerable communities, protect the oceans and promote gender equality.

“I believe we all need to do what we can with what we have, so I am pleased that the transfer of these shares will escalate our efforts to help those who need it most,” she said.

“From the outset and over the past 22 years, we have remained focused on supporting families to ensure every child has the opportunity to thrive and reach their full potential – as children are our future.”

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