UK 'Giving Pledge' would promise £60bn

By: 

Cheryl Chapman

Managing Editor, Philanthropy UK

Two of philanthropy’s greatest icons, US Microsoft founder Bill Gates and Berkshire Hathaway founder Warren Buffett, have thrown down the gauntlet to American billionaires with the launch of their ‘Giving Pledge’.

Having set an example by giving away the bulk of their own wealth, they are asking billionaires to follow suit and pledge to give away 50% of their fortunes in an effort to draw attention to the responsibilities the wealthiest have for aiding the needy.

The Pledge is a moral commitment to give, not a legal contract. It does not involve pooling money or supporting a particular set of causes or organisations. It has a minimum goal of about $600bn (£407bn) in commitments, based on the calculation of half of the $1.2 trillion (£0.8 trillion) in net worth of the 400 richest individuals compiled by Forbes magazine.

“It would easily double or triple the amount of philanthropy in America," said Melissa Berman, president of Rockefeller Philanthropy Advisors, a non-profit organisation that has advised the Bill & Melinda Gates Foundation on the initiative.

"If we would be able to get this influx for philanthropy from billionaires, it would inspire other Americans," she told Bloomberg News at the time of the launch. "And then we could really change what the world is like."

If the same pledge was taken up by the UK’s billionaires, the Charities Aid Foundation (CAF) estimates it would raise £60bn, based on the Sunday Times Rich List figures.
 
Mike Packham, head of private clients at CAF commenting on the pledge, says, “While I believe that charitable giving is very personal and understand that people are comfortable with different levels of charitable giving, it is great that Buffett and Gates are starting this debate among their peers and I hope that this leads to more billionaires becoming active philanthropists. Their actions may well break some of the taboos around philanthropy among the wealthy and lead to more openness around the subject, which is surely a good thing.”

Dr Sal LaSpada of the Institute for Philanthropy says role models are important and this initiative makes excellent use of them: “Whenever philanthropists lead by example in their giving, there are clear signs that they inspire others.  Whilst developing our work with philanthropists in China, we have been struck by how many of them have been spurred on by the work of Bill Gates. In some cases, philanthropists will respond to the challenge by going beyond what is asked of them. Eli and Edythe Broad, who having been asked to pledge 50% of their wealth to charity by Gates and Buffett, have replied with a pledge of 75%. The power of leading by example can not be underestimated.”

Sunday Times Giving List editor Alastair McCall, is not quite so upbeat - he says, “It is a highly aspirational idea, but  I am not sure it is likely to result in major cultural change around giving. I don’t think many philanthropists will be beating a path to their door with a pledge.”

At the time of writing four families had agreed to announce their pledge - real estate and construction billionaire Eli Broad who has pledged to give away 75%; venture capitalist John Doerr; media entrepreneur Gerry Lenfest and former Cisco Systems chairman John Morgridge.

Buffett, 79, said the pledge is "inspired by the example set by millions of Americans who give generously (and often at great personal sacrifice) to make the world".

The pledge has certainly put philanthropy in the headlines and set blogs alight with commentary on what this means for giving among the wealthy.