Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Left to right, Michael Bloomberg, T. Boone Pickens, Ted Turner, David Rockefeller, Ronald Perelman
Left to right, Michael Bloomberg, T. Boone Pickens, Ted Turner, David Rockefeller, Ronald Perelman

Billionaires accept charitable challenge Add to ...

When Warren and Bill and Melinda call, billionaires listen.

Nearly 40 ultrawealthy individuals and families pledged Wednesday to give away half or more of their fortunes to charity, answering a challenge issued in June by famed investor Warren Buffett, Microsoft founder Bill Gates, and his wife Melinda.

The first group of people to commit it the initiative includes technology titans and media moguls, financiers and tycoons, new money and old. Star Wars creator George Lucas is on the list, as is Larry Ellison, the founder of software giant Oracle Corp., and Montreal-born Jeff Skoll, past president of eBay.

People who sign on to the effort, called the "Giving Pledge," make a public promise to donate the majority of their wealth to charity within their lifetimes or after their deaths. As fundraising efforts go, it's a doozy: If all of the 400-odd billionaires in the United States made the same vow, more than $600-billion (U.S.) would be directed to good works.

"We've really just started, but already we've had a terrific response," Mr. Buffett said. He called the initial approach a "very soft sell" and said it involved appeals to as many as 80 billionaires on the Forbes magazine list of the world's richest people. For now, the initiative is focused on wealthy people in the United States, but there are plans to expand.

The program fits into broader changes that are transforming the way philanthropy operates, experts say. Unlike in past generations, many of the people on the list are middle-aged, marking a shift from a previous pattern where giving took place near the end of a person's life, or through someone's will. Many of those involved also want to achieve specific goals, not just write a cheque, and are actively including their children and grandchildren in their charitable efforts.

Born out of a series of dinners between Mr. Buffett, Mr. Gates, Ms. Gates and others over the course of about a year, the effort has electrified a subject that was largely restricted to private conversations among wealthy people: how much to give away, when, and why.

"What the pledge has done is taken it out of the cocktail party and put it online," says Eric Kessler, founder of Arabella Philanthropic Investment Advisors, which counsels individuals and organizations on how to achieve their charitable aims. "By making it so public, they're making it more acceptable."

Mr. Kessler says that the announcement of the initiative in June sparked dozens of conversations with clients who were "intrigued and engaged" by the pledge, particularly the notion of having a specific number - more than half their fortune - attached to their giving. "Having a clear benchmark certainly has moved the needle," he says.

The trio behind Giving Pledge idea has big plans. Mr. Buffett told The Wall Street Journal that he and Mr. Gates would meet with people in China and India in the coming months to talk about the pledge and potentially add more names.

"Ultimately, the plan is to take it [international]and to start to think about a real global culture of philanthropy among the world's wealthiest," says Melissa Berman, president of Rockefeller Philanthropic Advisors, which has provided advice on the initiative.

The public nature of the commitment will not appeal to all mega-rich people, experts say. A number of those involved, like Mr. Buffett, Mr. Gates, New York Mayor Michael Bloomberg, and oil tycoon T. Boone Pickens, had long said they would give away the vast majority of their fortunes to charity. However, some of them, like Oracle's Mr. Ellison, had not made that intention public.

In a letter posted on the group's website (givingpledge.org), Mr. Ellison said that many years ago he put nearly all of his assets into a trust so that, over time, he could give away 95 per cent of his wealth, estimated at $28-billion by Forbes.

"Until now, I have done this giving quietly - because I have long believed that charitable giving is a personal and private matter," he wrote. He went public, he said, because Mr. Buffett personally asked him to do so, saying it would be "setting an example" and "influencing others" to give. "I hope he's right," Mr. Ellison wrote in conclusion.

The idea appears to have tapped into what some describe as a baby boomer approach to philanthropy, with giving starting relatively early in life and being highly attuned to final outcomes.

Such givers are often reluctant to make their heirs too comfortable. "People are more aware of what can go wrong with too much money than they were at one time," says Marvi Ricker, who heads philanthropic services at BMO Harris Private Bank in Toronto. She says she has a number of clients who have said they'd only like to leave a small portion - say 5 per cent- of their wealth to their families.

Ms. Ricker predicts that wealthy Canadians will sign on to the Giving Pledge effort if there's a push to recruit them. "I'm sure they would love to be in the same company as Bill Gates and Warren Buffett."

Report Typo/Error

Follow on Twitter: @jslaternyc

Next story




Most popular videos »

More from The Globe and Mail

Most popular