OMAHA, Nebraska – The next generation of Buffetts — Howard, Susie, and Peter — is ready to become one of the most powerful forces in charity when their 94-year-old father, Warren Buffett, the famed businessman and Berkshire Hathaway head, dies.
However, this was not always the case.
Buffett stated in June that when he dies, he will transfer his fortune, now worth almost $144 billion, to a philanthropic trust run by his three children, rather than the Gates Foundation, as he had indicated 18 years ago.
Warren Buffett stated that the next generation of Buffetts will have ten years to distribute the money.
Meanwhile, the elder Buffett continues to make generous annual donations to the Gates Foundation and his four family foundations, which will continue throughout his life. In November, he initially revealed plans to establish a new charity trust.
Howard Buffett told The Associated Press that he has discovered that what his father taught him and his brothers about charity is correct: “It’s not so easy to give money away if you want to do it smart, if you want to be intelligent about it.”
Howard Buffett, the middle Buffett kid, said his father is as brilliant as ever and intends to live a long life, adding, “It’s pretty amazing that he’s giving us this opportunity.”
The Next Generation Of Buffett Is Poised To Become One Of The Biggest Forces In Philanthropy
“Wealthy people don’t tend to give their money to others to give away,” said James Ferris, founding director of the University of Southern California’s Centre on Philanthropy and Public Policy. However, many of the wealthiest people are unwilling to pass on their assets to the next generation, fearing that it will limit their innovation, he added.
Ferris believes the story of Buffett’s shifting philanthropic goals is a positive one. “It shows how a donor is making choices and is adapting to circumstances,” he told me.
The Gates Foundation did not specify when it learned of Buffett’s decision or what it would do for its budget. According to a prior statement, “Warren Buffett has been exceedingly generous,” and he has “played an invaluable role in championing and shaping the foundation’s work to create a world where every person can live a healthy, productive life.”
Buffett has made significant annual donations to the Gates Foundation, as well as billions of dollars to organizations administered by his three children and a fourth family foundation. Their study sheds some light on the goals of the next generation of Buffetts.
The Susan Thompson Buffett Foundation, named after Warren Buffett’s first wife, receives the most donations. It funds organizations that provide reproductive health care and access to contraception and abortion all around the world. Susie Buffett, 71, is the board chair, while Peter Buffett, 66, is a board member.
Susie Buffett also directs The Sherwood Foundation, a prominent national supporter of early childhood development that awards funds to organizations and projects in Omaha, Nebraska, the Buffetts’ hometown.
Peter Buffett’s NoVo Foundation has provided significant funding to organizations pushing for girls’ and women’s autonomy as well as against gender-based violence. In 2020, Peter and his wife, Jennifer, chose to shift their focus, increasing their support for Native American tribes and programs aimed at building sustainable, local communities with a focus on agriculture and food security.
The Howard G. Buffett Foundation has prioritised conflict resolution and agriculture around the world. Since 2022, it has provided around $800 million, more than most other countries, to humanitarian projects in Ukraine during the country’s conflict with Russia. These include aiding food distribution in schools, demining initiatives, and the reconstruction of a large publishing enterprise and a critical grain transport bridge.
In a somewhat rare interview for a family that rarely speaks with the media, Howard Buffett, 69, said he couldn’t anticipate how he and his siblings would distribute their father’s riches. However, he stated that they would continue to take risks and find ways to make the most difference, as their father had suggested.
“I can tell you, we’ll sit down in a room when the time comes, and we’ll get it figured out pretty quickly,” he said, admitting that the instruction to distribute all the money within ten years was difficult.
He praised the siblings’ diverse perspectives and methods to donating.
“What this is going to do is we’re going to bring all of our collective experience together,” he told me.
However, don’t expect to see the family name on many structures, since the brothers have mostly avoided it despite giving away more than $15 billion of their father’s money since 2006.
According to Kathleen Enright, president and CEO of the Council on Foundations, the Buffetts have effectively turned philanthropy into a family business, with the following generation of donors having established long-lasting institutions in their foundations.
“It is a big deal,” she remarked of the amount of money that the Buffetts are planning to give away, emphasizing that because the fortune is expected to increase, they will have to give away large sums to spend it down.
The short time span for giving away his riches after his death mirrors one of Warren Buffett’s traditional requirements for philanthropic donations. He has directed the Gates Foundation and his family’s foundations to distribute the entire amount they received within a year.
The next generation of Buffetts has run their foundations with small staffs, much like Warren Buffett supervises his massive Berkshire Hathaway conglomerate, which has only roughly two dozen personnel at its Omaha headquarters.
The Next Generation Of Buffett Is Poised To Become One Of The Biggest Forces In Philanthropy
Howard Buffett said his foundation had less than ten employees. Tax papers show that it granted $458.1 million in 2023. He recognized that his “lean” crew has some capacity limitations, but claimed they’ve expanded their work by developing strong and long-term connections with other organizations to assist in implementing their ideas.
In comparison, the Gates Foundation has one of the greatest endowments, at $75.2 billion, thanks to donations from Bill Gates and Warren Buffett. It employs nearly 2,000 individuals, many of whom are technical experts from around the world, and is well-known for offering highly targeted awards with stringent reporting requirements. The organization has said that it will cease operations within 25 years after its founders’ deaths.
Howard Buffett like a challenge and believes that affluent people should give their money away during their lifetimes rather than leaving it in eternal foundations.
“Someone is going to spend the money. “Someone is going to give that money away,” he explained. “So, I would rather do that with my brother and sister and do it together, as a partnership, than see it done any other way.”
SOURCE | AP
