The rise of Malcolm Turnbull to the position of Liberal leader means the top echelon of Australian politics is now dominated by two men who understand entrepreneurship – and whose families have become wealthy because of it.
The rise of Malcolm Turnbull to the position of Liberal leader means the top echelon of Australian politics is now dominated by two men who understand entrepreneurship – and whose families have become wealthy because of it.
Turnbull has an extensive business background. He started out as a lawyer, quickly rising to prominence in Australia when he became Kerry Packer’s legal adviser in 1983 at the age of 28. In 1986 he hit the international headlines when he travelled to London and successfully defended former spy Peter Wright, whose memoirs the British intelligence service was trying to ban. A year later, Turnbull entered the world of investment banking in partnership with former NSW premier Neville Wran and Nick Whitlam (son of the former prime minister).
In 1994, Turnbull was the joint founder of OzEmail, along with Sean Howard, Trevor Kennedy, his wife, former Sydney mayor Lucy Turnbull. The business, which was Australia’s 33rd internet service provider and one of the pioneers in the fledgling Australian internet sector, eventually became the country’s second biggest ISP. In 1999 – at the height of the tech boom – the founders sold OzEmail to MCI WorldCom for $520 million, netting the Turnbulls $60 million.
Turnbull then went on to become managing director of Goldman Sachs and a leading figure in the republican movement.
The Turnbull family’s wealth is now tied up in a series of investment vehicles, with extensive holdings in private companies and stakes in listed companies Melbourne IT, Cheviot Bridge, Commonwealth Bank, National Australia Bank, ANZ and Rubicor Group. The family also owns a large property portfolio centered around blue-chip Sydney suburbs.
In 2005, BRW magazine estimated Turnbull’s fortune at $133 million and while the recent fall in equity markets and asset values is likely to have affected his family wealth, Turnbull would still be worth well over $100 million.
Kevin Rudd’s family fortune and his understanding of entrepreneurship stem from his wife Therese Rein, who sold the Australian division of her successful recruitment business Igneus Limited last year in order to avoid potential conflicts of interest with Rudd. Rein retains a stake in Igneus (which continues to operate overseas) but her investments are now managed by a blind trust. Earlier this year, BRW put her fortune at around $60 million.
So what is the impact of having a wealthy entrepreneur in the Lodge?
Logically, small and medium businesses would expect to get a sympathetic ear from government, although the Rudd Government’s decision to slash $1 billion worth of SME programs in the federal budget in May shows this isn’t necessarily the case.
Turnbull is extremely well connected in business circles (indeed, Labor has used this against him at times) and in his first public comments as Opposition leader he has consistently stressed how thankful he is that Australia allowed his family (including his father and his wife) to grow businesses and make money.
“We know our job is to empower and enable the enterprise, the dreams, the ambitions of Australians,” he told reporters yesterday.
A whopping 83.7% of respondents to SmartCompany’s survey on Malcolm Turnbull (link to poll results below) said he would be better for small and medium business than Kevin Rudd.
It would appear the business vote is already swinging back to the Coalition.
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Malcolm Turnbull would be better for SMEs than Kevin Rudd: SmartCompany poll
Smart Company is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.
