Succession: the next generation of wealthy Australian heirs
Four heirs to some of Australia’s most private family offices reveal the challenges of managing the fortunes and taking over the empires built by their super successful parents.
They are the billionaires struggling to let go. The ‘big bulls’ in the paddock who have been successful in business but could be “terrible at having any sophistication or structure” behind them; the “super-entrepreneurial people” who do things intuitively.
And they are the ones whose kids are now grappling with how to manage the wealth their parents have made for them, establish family offices, turbocharge philanthropic efforts and figure out how to bring the grandkids of the patriarchs, or “gen 3”, along for the ride.
In a special roundtable organised for this year’s edition of The List - Australia’s Richest 250, the children of scions of four of Australia’s most successful and self-made entrepreneurs reveal how they are dealing with the important role of legacy, purpose and wealth in society while they manage some of the country’s most private family offices.
Brad Harris, the son of Flight Centre co-founder Geoff Harris, now runs Harris Capital - which comprises the family office, funds management and philanthropy arms set up by his father and mother Susan Harris.
He says his big challenge was getting the family’s affairs in order.
“My old man was very successful in business but was terrible at having any sort of sophistication or structure behind him. So as a member of Gen 2, I’m looking forward to Gen 3 and beyond,” he says
“Certain structure, governance, sophistication and processes were obviously needed to not only manage the status quo currently, but to grow and manage it through future generations.
“Dad was successful at how he built wealth, and he probably just didn’t see anything different.
“But when Gen 2 was looking at it going, ‘At some stage we are going to have to grapple with this’, I think he could see the bigger picture. That we needed to get some structure.
“Now I know, looking back, he says, ‘This is miles better than where we were’.”
Hayley Morris is the daughter of billionaire Computershare founder Chris Morris, is a director of the family’s privately-held Morris Group of companies that includes Queensland luxury resorts and pubs and restaurants in Victoria.
She says structure and processes are not the first things “super entrepreneurial people” go for, preferring to trust their intuition.
“You have a good idea, you go for it,” she says.
That has been an issue she has dealt with working with her father in businesses that are still operating, built from the proceeds he has made from Computershare share sales and dividends over the years.
“I feel like this has been a journey of it not working, to get to a place where I feel like it works. For me, that has been going into all our conversations without judgment,” she said.
“I think I came to a time where I felt like he thought I was trying to control him, and I thought he was trying to control me.
“We were both trying to get to a certain outcome.
“When I took judgment out of it and stopped thinking, ‘I need you to be here’, I found that we often wanted to be in the same place.
“We were just looking at it from a different angle.”
For Jackie Haintz, it was her father Peter Gunn’s brain tumour diagnosis in 1999 - after he had sold his transport empire to Mayne Nickless - that forced him to act.
Gunn is ranked 91st on this year’s The List - Australia’s Richest 250, with Haintz also involved as director of PGA Group.
“I think facing that sort of life-or-death situation, plus a more substantial shift from operator to investor, forced him to realise, ‘I have to fix this for the family’.
But the thing that Dad probably struggled with the most was succession, and handing over the reins,” Haintz, the executive director of the family’s PGA Group, says.
“The key for us is holding yourself accountable to your decisions and your actions. If you make a mistake, own it, but then work together to solve it.
“I think that is fundamental to making a family office work and maintaining that trust and loyalty.”
Steve Buxton, the son of MAB Corporation co-founder Michael Buxton, says the property developer’s family has recently employed a chief investment officer running the equity side of things and also a head of real estate running property.
He says his 80-year-old father is “still very much the big bull in the paddock” and having been extremely successful in property gravitates to that side of the family’s investments.
“He’s also a very good planner. He saw things unfolding before most of his peers in the past. I guess he’s still hanging on to that success and learning not just to trust his children, but also to recognise their talents,” Buxton says.
“I think that’s the big step for us to get through. We are organised and we know where we are heading, but we just have got to get to the point where there are more bulls in the paddock, and Dad can let go a little bit. That’s our challenge.”
The Buxton family has also advertised for a position they call a growth and engagement manager. The position will have a broad brief, including education, wellness and growth for the next generation - the “Gen 3”.
“[It includes] what opportunities we can find for them around the world that can make them 20 per cent better than they would be on their own. We are also building a database around Gen 3 and their needs, and what we can do to supplement what they are doing, and helping them understand investment and property and all the bits and pieces that make up what is the family office,” Buxton says.
Read the full roundtable discussion here
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