The Giving Pledge (www.givingpledge.org) is an initiative started by Warren Buffet, Bill Gates and Melinda French Gates to encourage the ultra-wealthy to commit to spend over half of their wealth on philanthropy, either during their lifetime or at their death. Anna Vayanos, specialist adviser to donors and non-profit organisations (NPOs), explains.
The pandemic has seen an increase in billionaires as well as an increase in extreme poverty. How does this increase in inequality reflect on campaigns like the Giving Pledge?
According to the Forbes Billionaire’s List for 2022, more than 1 000 billionaires are richer than they were a year ago and a further 236 people have also been added to the list.
There is certainly growing intolerance of excessive wealth, particularly where it is not being used towards solving the many challenges the world is facing. The Giving Pledge acknowledges this and seeks to shift the norms around wealth and giving – encouraging commitment by the wealthy to greater giving and greater impact.
Encouragingly, while the number of billionaires has increased, so too has the number of signatories taking the pledge. At the same time, while there have been high levels of growth in the net worth of the wealthy, there have also been high levels of giving. For example, according to Forbes magazine, Elon Musk’s wealth rose significantly during the pandemic, but he gave $5.7 billion to charity in 2021.
How many African philanthropists have become involved in the Giving Pledge?
More than 230 billionaires from 28 countries have taken the pledge. Of these, only four are listed as being from Africa: Patrice and Precious Motsepe (South Africa), Strive Masiyiwa (Zimbabwe) and Mohammed Dewji (Tanzania). Elon Musk and Mo Ibrahim have also taken the pledge, but are not included under Africa as they do not reside here.
Should more African philanthropists consider getting involved?
While the public nature of the pledge is in an effort to encourage larger-scale giving, it does not mean that those
choosing not to sign up are not giving, or are not committed. It might just be that they prefer to keep their philanthropic endeavours more private. Some of Africa’s richest individuals, Aliko Dangote and Mike Adenuga, both from Nigeria, are well known for their commitment to philanthropy. Closer to home, we have our own billionaire philanthropists like Nicky Oppenheimer and Michiel le Roux, who may not have signed up to the pledge, but are some of our most generous donors.
Has the Giving Pledge made a difference in terms of how much billionaires give?
Looking at how much funding should become available as a result of billionaires signing up to the pledge, it is significant. The collective net worth of the signatories is over $3 trillion, which means that at least $1.5 trillion would be channelled into philanthropy by the signatories alone.
Should a wealth tax be imposed in South Africa?
The idea of a wealth tax has been put forward as a way to ensure higher levels of giving among the wealthy, and while there is merit in this in theory, it brings with it its own challenges like the risk of discouraging investment in the country, and also determining who would be best placed to decide on how the funds collected should be spent.
Does the Giving Pledge specify where, when and how donations should be made?
One of the main criticisms is that signatories are not required to set a timeline for their giving nor to account for how the funds will be spent – other than that it must be towards charitable initiatives. One of the aims is for
participants to share knowledge and learn from one another, so although there are no detailed rules on how a pledger’s philanthropic initiatives should be conducted, they are encouraged to focus on high-impact, effective philanthropy and are provided with resources and opportunities to learn how to do this.
What are the pledged funds being used for?
Glasspockets.org has some interesting data on The Giving Pledge and, according to them, the pledge focuses on a variety of areas of philanthropy, the main ones being health, ‘human services’, education, and arts and culture. Signatories also show a willingness to take risks, which is one of the big advantages of private philanthropy.
This is one of the reasons in favour of signatories, and philanthropists in general, not being too restricted in what they become involved in philanthropically, or how funds are spent.
Can anyone join the Giving Pledge?
Unfortunately not, as not many of us would qualify. A person must have at least $1 billion in personal net wealth to sign up. However, one need not be a billionaire to be a philanthropist.
As Warren Buffet put it in his pledge letter: “More than 99% of my wealth will go to philanthropy during my lifetime or at death. Measured by dollars, this commitment is large. In a comparative sense, though, many individuals give more to others every day.”
ANNA VAYANOS
Anna Vayanos Philanthropy Consulting anna@annavayanos.com
www.annavayanos.co.za
Source: The Trialogue Business in Society Handbook 2022 (25th edition)