May 2011

The Nation Reviewed

Owners of Australia

By James Kirby
Illustration by Jeff Fisher.
Australia’s rich list

It is a curious irony that Australia’s first ‘rich list’ was created for the Communist Party of Australia. In 1955, Brisbane journalist Pete Thomas edited the pamphlet Who Owns Queensland, which was, in effect, a shame file. More than 60 years on, the pioneering work of apparatchiki such as Thomas has evolved into something entirely different.

BRW magazine’s ‘Rich 200’ list – published annually in May – is, if not a capitalist hero-gram, then a roll call of Australian business champions that is guaranteed to entice readers who normally would never spend a moment in a newspaper’s business or finance section. It is not a realistic audit; such a database is not even achievable. But, without access to tax office files, the ‘Rich 200’ is our best guide to individual wealth.

The Australian list is compiled by a team of researchers on short-term contracts who rarely express interest in a career in journalism; rather, they tend to be young bankers eager to glean insights into how to accumulate a personal fortune.

No doubt this method is adopted for other rich lists produced around the world in what has become something of a publishing subgenre that might be tagged “tycoonography”. In the United States, the dominant rich-list publisher is Forbes magazine; in the United Kingdom it is the Sunday Times. The process is sliced and diced ad nauseam: Sports Illustrated does the ‘Richest Athletes List’; Vanity Fair now does a ‘Hollywood Rich List’.

Easiest to research are tycoons with stock-market fortunes. The researcher simply multiplies the number of shares by their price and they have a ballpark figure. But when fortunes have multiple hidey-holes (especially when they are mostly in private companies), it gets more difficult. Jean Paul Getty is alleged to have said, “If you can actually count your wealth, you’re probably not very rich.”

Tycoons, almost by definition, weave a complex web, and those who operate in a maze of private ventures are hard to pin down. Consider the net worth of the late Richard Pratt’s son, Anthony, with his Visy group. In the case of the Pratt family, a researcher can only apply valuation multiples from similar packaging companies (Amcor, for example) and then try to guess the personal debts that members of the family might carry.

Artists and entertainers are more difficult still. The worth of their recording contracts and marketing brands is almost entirely guesswork, and the direct approach – simply asking them – often finds them aghast: How, as artists, are they being assessed alongside trucking magnates and oil barons?

You might imagine this annual public examination of wealth creating untold social difficulties in the dining rooms of Melbourne’s Toorak, Sydney’s Double Bay and Perth’s Peppermint Grove. But those on the ‘Rich 200’ list whose complaints are serious enough to have themselves removed from the files are remarkably few. It would be reasonable to imagine such extreme visibility creating tax tensions, but there’s no evidence of that either: the clout that inclusion on the list gives when it comes to raising money appears to be worth the exposure.

Problems arise when newcomers are placed too high on the list, sometimes due to a researcher’s overestimation. Subsequently, to minimise public suspicions, they have to be slowly lowered, year by year. Likewise, those revealed, as a result of a deal or a ‘liquidity event’, to have been grossly underestimated must be steadily elevated. Then there is the delicate matter of the dead. A researcher’s greatest fear is that a ‘reclusive’ list member (one who will not co-operate) has died during the year. It could happen.

As each new list comes along, it is the new self-made fortunes that get the headlines. Recent “new breed” entrants include mining magnate Nathan Tinkler and online tyros, such as the Bassat brothers, founders of recruitment empire Seek.

Mainstream media loves to feature perennial entrants – such as Gerry Harvey of Harvey Norman – who not only fly high but help others get there too. Harvey’s ex-wife, Lynette, and his now-retired business partner, Ian Norman, have accrued substantial fortunes.

For all the annual media rich-list hype, the list changes little, reflecting an isolated economy with monopolistic tendencies. In the ’60s, another campaigning journalist, Edward Campbell, made an ambitious attempt at a list that he hoped would shame the nation into a redistribution of wealth.

Campbell’s Who Owns Australia, published in 1963, detailed the serious fortunes of the Myers, the Fairfaxes, the Darlings and the Maple-Browns, all families still on the list today. The original Communist Party of Australia might have had something to say about that but it was dissolved in 1991.

James Kirby
James Kirby is a financial journalist. He is the author of the book series Business Secrets, and the managing editor of the online Business Spectator and the Eureka Report.

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