Future Generation is an ASX-listed fund manager that offers investors access to leading Australian and global fund managers – while also supporting charities.
Caroline Gurney, CEO of Future Generation, talks to Sean Aylmer about the fund, and why some of Australia’s best-known investors are giving their time and expertise to help it grow.
This is general information only. You should seek professional advice before making investment decisions.
Find out more: https://fearandgreed.com.au
See omnystudio.com/listener for privacy information.
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Sean Aylmer: Welcome to the Fear and Greed Business Interview. I’m Sean
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Sean Aylmer: Aylmer. We have an investing interview with a difference today.
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Sean Aylmer: Future Generation is an ASX listed fund manager that offers
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Sean Aylmer: investors access to leading Australian and global fund managers, while
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Sean Aylmer: also supporting charities that help children and youth.
It was
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Sean Aylmer: founded by Wilson Asset Management’s, Geoff Wilson, a friend of
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Sean Aylmer: the podcast. He founded it back in 2014 as a
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Sean Aylmer: way for the funds management and finance sector to make
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Sean Aylmer: a difference. I wanted to take a closer look today
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Sean Aylmer: at how it all works, what it means for investors,
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Sean Aylmer: for fund managers, and who they’re helping. Caroline Gurney is
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Sean Aylmer: the Chief Executive Officer of Future Generation. Caroline, welcome to
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Sean Aylmer: Fear and Greed.
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Caroline Gurney: Oh, thank you so much. I’m delighted to be here.
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Sean Aylmer: How does Future Generation work? Just explain it to us.
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Caroline Gurney: It’s actually, it’s quite a simple concept, but it’s hard
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Caroline Gurney: I think for people to grasp it upfront. But we
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Caroline Gurney: are Australia’s first listed ASX vehicles and we provide both
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Caroline Gurney: investment and social returns. We have shareholders’ money, we have
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Caroline Gurney: between the two companies, one that invests in global equities
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Caroline Gurney: and one that invests in a Australian equities. We have
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Caroline Gurney: the best boutique fund managers managing the money on a
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Caroline Gurney: pro bono basis.
That actually means we don’t charge shareholders
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Caroline Gurney: any of the usual management or performance fees that you
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Caroline Gurney: usually have to pay to get access to them. And
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Caroline Gurney: that allows us to donate 1% of our net assets
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Caroline Gurney: under management to our not- for- profit partners. And that’s
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Caroline Gurney: really amazing because if you add up the 1% that we’ve
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Caroline Gurney: been giving over the last eight years, we’ve now given 75.
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Caroline Gurney: 9 million to not- for- profits specializing in youth at
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Caroline Gurney: risk and youth mental health and prevention and wellbeing. Something we’re
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Caroline Gurney: unbelievably proud of.
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Sean Aylmer: Okay. I think I’m repeating this to you but so
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Sean Aylmer: it’s net assets, it’s not net profit. It’s actually if
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Sean Aylmer: you’ve got $ 100, 1%, so $ 1 of that is going to one
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Sean Aylmer: of these organizations. That’s right. Is it?
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Caroline Gurney: Yes, it is. It is. And also shareholders get investment returns.
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Sean Aylmer: Right. If I want to invest, it’s a LIC, is
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Sean Aylmer: it, Listed Investment Company?
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Caroline Gurney: It is.
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Sean Aylmer: I invest in that. I put my $1, 000 into Future
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Sean Aylmer: Generation Australia or Future Generation Global. I know that effectively
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Sean Aylmer: 1% of those net assets is going to help people
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Sean Aylmer: and then I get investment or returns. Where you can
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Sean Aylmer: do it, it’s because the fund managers aren’t charging fees.
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Sean Aylmer: Is that the arbitrage there?
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Caroline Gurney: Absolutely perfect.
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Sean Aylmer: Okay. You’ve made this money. How much did you say
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Sean Aylmer: you’ve given away?
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Caroline Gurney: Well, over the last eight years, 75. 9 million.
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Sean Aylmer: Wow. 10 million a year you’re giving away. Couple of
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Sean Aylmer: questions. Who are the fund managers involved?
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Caroline Gurney: We have the great fund managers in Australia. For example,
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Caroline Gurney: if you look at all of those boutique fund managers
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Caroline Gurney: you can’t actually get access to or they’re closed. We
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Caroline Gurney: have Paradice Investment Management, we have Bennelong, we have Regal,
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Caroline Gurney: we have L1 Capital. And on the global side we also
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Caroline Gurney: have Cooper’s. We have Antipodes, we have Hollow, Wisco Partners
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Caroline Gurney: and Lanyon just a name but a few. We have
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Caroline Gurney: 33 fund managers across both of our LICs managing shareholders’ money.
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Sean Aylmer: Okay. And do they get on? This is just an
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Sean Aylmer: aside question, Caroline, because you’re managing all these people and
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Sean Aylmer: they’re not getting paid for it, are they?
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Caroline Gurney: No, they’re not getting paid for it. Well, they get
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Caroline Gurney: on with us and that’s the most important thing, and
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Caroline Gurney: I think for many of them it’s philanthropic. It’s where
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Caroline Gurney: they’re making a difference. Yes, they’re great to work with.
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Sean Aylmer: Okay. You’ve raised this money, almost $ 10 million a year
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Sean Aylmer: over eight years. Where does it go? Who are the
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Sean Aylmer: organizations that specifically that you’re helping out?
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Caroline Gurney: You’re right. Basically in terms of the Australian one, it
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Caroline Gurney: goes to youth at risk. For example, you’ve got Youth
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Caroline Gurney: Off The Streets, you’ve got Act for Kids, you’ve got
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Caroline Gurney: Australian Indigenous Education Foundation, you’ve got Lighthouse, which is about
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Caroline Gurney: homelessness. You have Mirabel, which is basically for young people
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Caroline Gurney: who has been disadvantaged by their parents or their carers,
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Caroline Gurney: dying of a drug overdose or something related. Really fantastic
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Caroline Gurney: organizations that really need money on a long- term basis
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Caroline Gurney: so they can actually do the job they’re really good
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Caroline Gurney: at doing.
And then globally that’s more about prevention, wellbeing.
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Caroline Gurney: We have REACH out there, we have Mind Blank, which
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Caroline Gurney: uses drama and actors to act out difficult times in
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Caroline Gurney: children’s lives so they can actually talk about it together.
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Caroline Gurney: We have Project Rocket, which is basically working in schools
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Caroline Gurney: and the girls that run that are amazing women who
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Caroline Gurney: are also on the board for a lot of the
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Caroline Gurney: big Google, et cetera in terms of helping them with
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Caroline Gurney: technology for young people and how to use it properly.
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Caroline Gurney: I can go through all of them. I mean we have 14.
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Sean Aylmer: I get the gist of it, so that’s fine. Well,
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Sean Aylmer: how do you make sure that the money’s being well
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Sean Aylmer: used? If I’m going to invest in the Future Generation
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Sean Aylmer: and I can buy into one of the ASX listed
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Sean Aylmer: funds, how do I know that the money is… I
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Sean Aylmer: mean, do you have some measure in terms of impact
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Sean Aylmer: that these charities have?
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Caroline Gurney: That’s a really important question because we really want to be able to
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Caroline Gurney: measure the impact that our not- for- profits are having
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Caroline Gurney: on their audience. Say for example, for Future Generation Global,
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Caroline Gurney: we actually went out to the whole of Australia and
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Caroline Gurney: asked for applications for not- for- profits that we could
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Caroline Gurney: fund. And we now have 14 new not- for- profits
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Caroline Gurney: in that mental health prevention space. And we are measuring
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Caroline Gurney: their impact.
We’ve actually let all of the not- for-
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Caroline Gurney: profits invest in what they want to invest in. They
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Caroline Gurney: don’t actually have to create a vehicle for our money.
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Caroline Gurney: They can actually use the money for what they think
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Caroline Gurney: is the best thing, which we feel is really important.
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Caroline Gurney: And then we ask them to report on that and
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Caroline Gurney: to actually give us the number give of young people that
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Caroline Gurney: it’s helped in various different forms for data.
By the
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Caroline Gurney: end of this year, we’ll be able to actually say, ”
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Caroline Gurney: These organizations have helped XX number of young people and
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Caroline Gurney: they’ve helped them onto a path of whatever that might
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Caroline Gurney: be in terms of their metrics.”
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Sean Aylmer: Stay with me, Caroline. We’ll be back in a minute.
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Sean Aylmer: My guest today is Caroline Gurney, chief executive officer of Future Generation.
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Sean Aylmer: Given $ 80 million over eight years or thereabouts, it gives
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Sean Aylmer: us an idea about how big these funds are, but
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Sean Aylmer: can you just give us a bit more information on
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Sean Aylmer: that and whether they’re growing? Whether Australians generally are seeing
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Sean Aylmer: it as a good way to be philanthropic and earn
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Sean Aylmer: investment returns?
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Caroline Gurney: In terms of what we are doing at the moment,
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Caroline Gurney: I mean we have over a billion, so it’s approximately
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Caroline Gurney: half in each of the LICs. And that’s pretty much constant.
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Caroline Gurney: It has gone slightly down because of what’s happening in
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Caroline Gurney: global markets, but we anticipate that it will grow again.
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Caroline Gurney: And I just think the more we actually talk about
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Caroline Gurney: how we can make a difference in the community and
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Caroline Gurney: as well as giving shareholder returns, I think these vehicles
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Caroline Gurney: are just amazing ways to save for the long term.
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Caroline Gurney: I mean, that’s what listed investment companies are very good
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Caroline Gurney: for. And also make sure you actually give hope to
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Caroline Gurney: so many young people.
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Sean Aylmer: Is Geoff Wilson still involved then? Geoff’s been on our
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Sean Aylmer: show quite a few times. And people from Wilson Asset
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Sean Aylmer: Management have been.
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Caroline Gurney: Oh, Geoff is still very much involved. I mean, he’s
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Caroline Gurney: obviously our founder.
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Sean Aylmer: Can’t get rid of him.
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Caroline Gurney: Oh, no, no. We really, we do need him. I
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Caroline Gurney: mean, I think his insights especially into LICs in the investment
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Caroline Gurney: world are really important. But he’s actually acting chair of
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Caroline Gurney: FGG and he’s on both investment companies and he’s also
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Caroline Gurney: obviously on FGX as well. Yes, he’s integral in terms
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Caroline Gurney: of what we’re trying to do.
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Sean Aylmer: It’s a great way for people like Geoff and other
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Sean Aylmer: fund managers to give back because in some ways they
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Sean Aylmer: can go on boards or whatever, but they’re actually using
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Sean Aylmer: their expertise to hopefully create money for good causes rather
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Sean Aylmer: than just giving money. It’s a bit more value add or something.
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Caroline Gurney: Well, I think it’s they’re doing what they’re really good
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Caroline Gurney: at. I mean they’ve performed over the long term and
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Caroline Gurney: we expect them to continue performing. But also, what they
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Caroline Gurney: do is they manage this money in their main fund,
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Caroline Gurney: so it’s they’ve got skin in the game as well,
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Caroline Gurney: so they care truly about their performance. And by managing,
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Caroline Gurney: some of them are managing 40 million, different amounts, they’re
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Caroline Gurney: giving a huge amount back.
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Sean Aylmer: You’ve been in the job for a few years now,
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Sean Aylmer: Caroline. And I’ve known you well before then. And this
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Sean Aylmer: is a bit of a change in tack for you.
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Sean Aylmer: Are you enjoying it?
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Caroline Gurney: I mean, I really love it. I really, I love
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Caroline Gurney: talking to shareholders. I love finding out why they invest
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Caroline Gurney: in Future Generation, what their aims are, what their inspiration
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Caroline Gurney: is. And also the fund managers, they’re really interesting people,
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Caroline Gurney: and the fact that they want to do more and
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Caroline Gurney: do good is fantastic. And the fact that so many
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Caroline Gurney: people want to be involved with us and do it
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Caroline Gurney: pro bono, I mean that I think really shows that
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Caroline Gurney: there’s a lot of hope out there and a lot
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Caroline Gurney: of goodwill.
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Sean Aylmer: Caroline, thank you for talking to Fear and Greed.
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Caroline Gurney: Thank you very much, Sean. Pleasure.
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Sean Aylmer: That was Caroline Gurney, CEO of Future Generation. This is
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Sean Aylmer: the Fear and Greed business interview. Remember, if making any
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Sean Aylmer: investment decisions, you should always seek professional advice for your
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Sean Aylmer: circumstances. Join us every morning for the full episode of
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Sean Aylmer: Fear and Greed, Australia’s best business podcast. I’m Sean Aylmer.
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Sean Aylmer: Enjoy your day.