Warren Buffett explains why he changed his mind on giving away his fortune to the Gates Foundation
Warren Buffett has explained why he ended his long-standing pledge to leave the bulk of his fortune to the Gates Foundation, saying he re-evaluated his philanthropic plans as his wealth grew and his children became capable of overseeing his charitable legacy.
In an exclusive interview with CNBC, the billionaire investor said his decision was not driven by a loss of confidence in the Gates Foundation but by a reassessment of how his fortune should be managed and distributed in the future.
When asked why he was no longer giving money to the Gates Foundation, Buffett said, “I re-evaluated my whole situation.”
Buffett said he and his late wife, Susan Buffett, had developed their philanthropic philosophy decades ago. Their plan was for him to focus on compounding wealth while she focused on giving it away effectively.
“My idea and conviction was that I would compound money at a better rate than society generally, and that Susie would give it away better than 99.9% of the people who were giving it away,” Buffett said.
He said that approach evolved as his fortune expanded far beyond what they had originally envisioned.
“Well, we changed plans because… the money began to pile up,” Buffett said.
Buffett also rejected the suggestion that he had trusted the Gates Foundation more than his children when he pledged the bulk of his fortune to the organisation in 2006.
Asked whether he now trusted his children more than the Gates Foundation, Buffett said the circumstances had changed rather than his level of trust.
“The variables were different,” he said. “It isn’t to say that I trusted them differently, but I felt they were capable of handling it.”
Buffett said he did not believe his children were ready to oversee vast charitable donations two decades ago. Over time, however, he concluded they had developed the experience needed to manage his philanthropic legacy.
The veteran investor also defended his decades-long support for the Gates Foundation, saying he believed his earlier donations had been the right decision.
“I gave the Gates Foundation a great deal of money. I thought that was a good decision. I think it was a decent decision,” Buffett said.
He added that the Gates Foundation had exceeded expectations in its ability to deploy charitable capital.
“The Gates Foundation has turned out to earn far more money than they expected to. They spend more money than anybody else,” Buffett said.
Buffett has said all of his remaining Berkshire Hathaway stock, currently valued at about $146 billion, will be distributed to charity by the end of 2034. Under the revised plan, the donations will be overseen by his three children, replacing an earlier arrangement under which they would distribute his remaining fortune within 10 years of his death.
Earlier this week, Buffett omitted the Gates Foundation from his annual charitable donations for the first time since making his 2006 pledge. Instead, he announced plans to donate about $6 billion to four foundations linked to his family.