Sound investments keep AOC ahead of the Olympics since 2001

Astute investing has seen Australian Olympic Foundation return an average of more than 8 per cent a year since 2001.

Astute investing has seen the Aust­ralian Olympic Foundation return an average of more than 8 per cent a year since it was set up in 2001, according to its latest ­report, to be released this morning.

This is almost three percentage points above its return target for the 16-year period.

The report shows the fund’s assets­ have grown from about $100 million in 2001 to $146.3m by the end of March this year — after taking out $107m to help fund some of the AOC’s activities over the 16-year period.

The board of the fund meets in Sydney this morning to review its accounts. The fund was started in 2001 with $90m handed to the AOC from the Sydney Olympics in 2000, plus some other AOC money.

The fund is chaired by AOC president John Coates, who is ­facing an unprecedented election for his role tomorrow.

Its investment advisory committee is chaired by former federal opposition leader John Hewson. Other members of the advisory committee include former AMP chief executive Paul Batchelor, company director Helen Nugent, Telopea Capital Partners’ Craig Carracher and Gold Coast stockbroker Angus Douglas.

Sydney businessman Garry Wayling, a director of ASX-listed OneVue and former partner of accounti­ng firm EY, was recently appointed its executive director.

The goal of the fund is to grow its capital base while providing income­ for the Australian Olympic Committee to help send Australian teams to the winter and summer Olympics as well as the winter and summer youth Olympics. The fund has been advised on its investment strategy by Mercer Investment Consulting since it was established.

The report shows the fund’s ­assets grew by $4.1m to $150.5m, up almost 3 per cent, in the three months to the end of March. More than $1.56m was distributed to the AOC during the quarter.

The fund has been contribut­ing about $25m to the $88.7m AOC budget for the four-year Olympic period.

“The composite return for the foundation since its inception in 2001 to March this year has been 2.7 per cent above its return target of CPI plus the 10- year bond rate,” Mr Coates says in the report.

He said the foundation’s invest­ment advisory committee was now reviewing its investment target in the light of the low interest and bond rate environment.

He said the new target would be for the fund to earn $25m plus CPI, plus one percentage point for growth in the future.

Mr Coates said the fund’s return­s recently had been helped by higher stockmarket prices in Australia and the US.

Mr Hewson told The Australian that the committee’s goal was to manage the investments of the foundation. It was up to the AOC to decide how it spent the funds.

“The AOC has never had any money from the government for a long time,” he said. “The proper management and governance of sport is most important.

“That is where the focus should be going to. It is a very long-term process. The Olympics take place every four years and the planning is done years ahead.

“The AOC is already working on the funding for the Winter Olympics in South Korea (next year) and the (2020) summer Games in Tokyo.’’