In 2010, Bill Gates and Warren Buffett teamed up on an unusual project: convincing hundreds of millionaires that They didn’t need half his fortune and they owed billions of dollars to philanthropic projects. Sounds crazy, right? Well they got it.
However, the model promoted by these two regular figures in the top 10 with the greatest fortunes in the last four decadesappears to be reaching a tipping point. They are coming tax reforms and moral incentives are not supported by the always convincing fiscal incentives. The golden age of philanthropy among millionaires could be in its final stages.
Gates and Buffett’s original plan. The project The Giving Pledgelaunched by Gates and Buffett 15 years ago, invited hundreds of the world’s billionaires to sign a non-binding pledge promising to donate at least half of their fortune to charitable causes during their lifetime or after their death. Since its creation, more than 250 billionaires from 30 countries have signed this commitment, adding a combined fortune close to $600 billion in potential donations. according to calculations of Business Insider.
Despite the magnitude of the figures, in recent years the viability of this model of collective philanthropy has been questioned. Warren Buffett himself recognized in his last letter to Berkshire Hathaway shareholders that its plan to engage and motivate the ultra-wealthy “hasn’t worked,” assuming the idea of a golden age of mass philanthropy may be coming to an end. According to a recent report of the Institute of Political Studies, of the 256 signatories of the commitment to donate half of their fortune, only nine have fulfilled their promise.
Open doors to philanthropy. The approval of the “One Big Beautiful Bill” Act, a fiscal package that imposes a 10% tax to foundations with more than $5 billion in assets, has significantly altered the philanthropic plans of many billionaires. The withdrawal of tax incentives makes donations They are no longer such a priority for great fortunes.
According to what he told Fortune Kathleen McCarthy, director of the Center on Philanthropy and Civil Society“The insidious thing about this is that it will seriously affect the large liberal foundations like Gates, Ford and Soros”, which contributed millions of dollars to social, health and educational projects. “Whereas conservative foundations are much smaller and will pay a much lower rate,” McCarthy stressed.
New ways to donate. This new scenario, which alienates large foundations from the front line of giving, is pushing philanthropists to look for alternative ways to give and modify their strategies. “Billionaires will begin to look for alternative mechanisms when they realize that they are being forced to close their foundations,” explains McCarthy.
Practices like direct donation practiced by MacKenzie Scott, ex-wife of Jeff Bezos, and her Yield Giving foundation are gaining ground. Your strategy: donate the money directly to the organizations that develop the projects. Without intermediaries or segmentation of funds. According to a report of the Center for Effective PhilanthropyScott has already awarded more than $19.25 billion to 2,450 nonprofit organizations. This is how Bella DeVaan, from the Institute for Policy Studies in the article Fortune“I think she sets the trend and is an ethical reference in the way of donating money, as Gates has been.”
Buffett’s family legacy. Although the era of massive philanthropy seems to end, Warren Buffett has not stopped giving. With Buffett’s retirement as head of Berkshire Hathaway, the investor has delegated part of his fortune in donations to the charitable foundations of his three children and his late wife. Annually, the veteran investor has been distributing billions in the form of actions to strengthen the family legacy and ensure that its wealth benefits society.
However, in his latest donations from the millionaire a striking absence has been noted: the Bill and Melinda Gates Foundation has already does not appear among its beneficiaries.
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Image | Flickr (Fortune Live Media)
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