Listening to Kerr Neilson speak about giving away money, it becomes clear that he has only a few basic rules: promote social cohesion, make sure art gets enough money to do what it’s meant to do, and find organisations others overlook – the less sexy, the better.

Since its inception a decade ago, the Neilson Foundation has gifted about $70 million, but most of it hasn’t gone towards emotive subjects like health, and particularly cancer. Those are an easy sell for fundraisers, Neilson says. Add to that the input from drug companies and governments and medical research is already well funded.

“The market mechanism’s working perfectly, so we give virtually nothing to medical,” the billionaire fund manager and co-founder of Platinum Asset Management says. “What we do is give money to things that are not attractive, like drug rehabilitation.”

While the choice of causes the foundation supports might make Neilson appear to be Australia’s richest bleeding heart, his ability to analyse the charity sector in the same way as any other means his money goes where it will be most effective. He has a reputation for fastidious due diligence on any project seeking donations but avoids any involvement in managing them.

Each year, the gifting committee – which comprises Kerr and his daughters Paris and Beau – meets to assess projects. In some cases, such as the $150,000 paid towards scholarships for university students studying financial planning, Platinum Asset Management matches the foundation’s funding with its own donations, enabling grants to 24 students each year.

The best of those scholarship holders are also given insider access to Platinum’s business, working for a month in the research department of the fund manager.

“Universities do a great job but the stuff they are learning is so different to what they experience when they come into our world, where we’re talking about business and the prices of consequence of a business, not the other way around.

Neilson says the students come out “absolutely bewildered by the delight” of working in the financial planning sector, which for an industry plagued in recent years by public relations disasters and apathy towards its very existence is “a very good thing”, he says.

“It’s beer money,” Neilson says of the $12,500 scholarship. “I don’t believe it changes their lives. But it’s a bribe to try to get more people into the financial services. The big change is this fee for service, a clear demarcation from the old style of financial planner. We think it is our duty to promote this new profession.”

The power of art

For most people, however, the Neilson name has become synonymous with the arts, particularly visual arts, in no small part because of the success Kerr’s ex-wife, Judith, has made of Sydney’s White Rabbit Gallery.

The gallery, founded in 2009 before the couple split, provides the public with a glimpse into Judith’s personal collection, which she has built into one of the most significant stores of contemporary Chinese art in the world and now funds largely from her own assets.

That it’s his ex-wife’s project now doesn’t change Neilson’s attitude towards it. He sees the arts as important for their ability to “free people from the tyranny” of what they were taught about life and history – and art at school. With the White Rabbit Gallery in particular, its narrow focus allows more children to see their own histories through a different narrative.

“You get these school groups coming through and many of them are from less privileged backgrounds and many of them are Asian and the…kids [relate] to it and regard it as their art,” Neilson says. “They go in shuffling and thinking, ‘What are we going to be subjected to here?’ and ‘This is not a very good idea.’ And they come out like peacocks because suddenly they say, ‘My goodness, that’s what my folk are doing.’ So it is a unifying force, it stops them feeling oppressed, they start seeing that they come from a very worthy background.”

It’s that idea of building social cohesion that is central to the way Neilson and his daughters distribute the foundation’s money. Organisations they have supported range from Anti-Slavery Australia to the Biennale of Sydney, the Refugee Advice and Casework Service and the Sir David Martin Foundation for young people in crisis.

Small causes matter

Youth rehabilitation centre Triple Care Farm in the Southern Highlands, which is funded by the Sir David Martin Foundation, was given half its founding budget by the Neilson Foundation and has since doubled its capacity, to help care for more than 100 youth each year.

“The consequence of that is that they plan to get, I think, a 75 per cent retrieval from the juvenile justice system, where they’d end up otherwise,” Neilson says. “So you say why are we happy? I mean, the idea of saving someone from a juvenile justice system, that can give you a thrill, that’s not difficult.”

Women’s shelters are also on his list, described as something easily missed because they don’t sound like a necessary service but are, in reality, “hugely important”, Neilson says, as does something seemingly minor, such as hearing impairments for indigenous children.

“Aboriginal children go to class and they’re regarded as dunces because they can’t jolly well hear, because they suffer from more problems with their hearing than other kids, for a whole lot of reasons. So it’s those sorts of things that are interesting [to fund],” he says.

Underpinning everything is Neilson’s own attitude towards money, which a cynic might say is only possible when you’re worth upwards of $3 billion. Nonetheless, it determines how his money is used.

He is a firm proponent of the idea that materialism won’t bring happiness, but simultaneously recognises that giving enormous amounts of money away comes with its own existential challenges.

“It cannot possibly be true that the marginal value of extra money does much for you, for your psyche, your sense of self-worth, your sense of being in touch with the rest of the human race,” Neilson says. “Money does give you choices and you can put some into purposes that might benefit a lot of people. [But] if I think of George Soros, he gives billions away but when I saw him last, he was quite despondent that for all his efforts…he felt he could save so many starfish but not really the whole flock – whatever starfish travel in.

“You could do so much but you’re always frustrated because there’s always so much need.”

This article is based on a fireside chat between Kerr Neilson and Conexus Financial chief executive Colin Tate as part of the 2017 Conexus Financial Absolute Returns Conference. To read the full transcript of the chat, click here.