First Person Channel

The Giving Pledge – Could it work in the U.K.?

Earlier this year Microsoft billionaire and notoriously reluctant interviewee Bill Gates made himself available to the U.K.’s media to promote The Gates Foundation and his ambition to eradicate polio and malaria altogether in the near future. In the course of these discussions he talked about The Giving Pledge, his and Warren Buffet’s initiative to encourage the wealthiest U.S. citizens to donate their fortunes to charity.

The Giving Pledge celebrated its first anniversary in 2011 and already 69 of the wealthiest individuals and families in America have committed to giving the majority of their wealth to philanthropic causes and charitable organisations of their choice either during their lifetime or after their death. Pledgers so far include Microsoft Co-founder Paul G Allen, Co-founder and Chief Executive of Oracle Corporation Larry Ellison, media mogul Ted Turner and President and Chief Executive of Facebook Mark Zuckerberg.  

The Giving Pledge is currently confined to the U.S. but The Gates Foundation now has a European office in London and Gates himself has said that he would be willing to help anyone interested in setting up a parallel initiative in the U.K.. His comments were welcomed by New Philanthropy Capital (NPC), a consultancy and think tank dedicated to helping funders and charities achieve greater impact, who advocated a U.K. version of The Giving Pledge as part of their ten-point plan to boost giving in this country.

The NPC ten-point plan was released to coincide with the Government’s own Giving Green Paper; itself only part of the increased emphasis on philanthropy that this Government has initiated. Indeed Bill Gates has himself commended David Cameron and the coalition Government’s commitment to increase aid spending in spite of the current economic climate.

But what of a U.K. version of The Giving Pledge? NPC* believe that if led by a group of millionaires rather than one of the UK’s 53 billionaires then it could be an effective way of overcoming existing barriers to high-end philanthropy. And Bea Devlin, Head of International at the Charities Aid Foundation estimates “that if all of the billionaires based in the U.K. decided to give over half of their wealth to charity then this would result in at least an additional £60bn going to good causes, which would go a long way to solving some of the world’s most pressing problems”**.

There are those, however, who remain unconvinced of the efficacy of this approach to philanthropy. One of the interesting aspects of The Giving Pledge in the U.S. is that many of those who signed up already had their own charitable foundations and the nature of their pledge doesn’t commit them to anything beyond their existing arrangements or indeed to any quantifiable figure.

The American philanthropist  Lewis B Cullman, who, to date, has donated over $223 million to the arts, sciences and education, remains unimpressed and told the Wall Street Journal*** that ‘the money donated to charity by the very wealthy usually ends up locked in private grant-making foundations that may only release a trickle of the billions of dollars squirreled away inside’.

Closer to home there is a general perception that philanthropists in Britain wouldn’t  wish to attract the level of interest in, and publicity around their donations that signing up to a U.K. version of the Giving Pledge might bring. And in a recent Guardian online survey 29% of those polled indicated their belief that it simply wouldn’t work in the U.K..

It would be easy to assume that this implies a certain reluctance amongst the U.K.’s high net worth community to donate to good causes. The reality, however, is very different. In 2010 U.K.-based Indian businessman and philanthropist Anurag Dikshit and the Sainsbury family gave away over £100m**** each. Since 2006 hedge fund manager Chris Hohn and his wife Jamie Cooper Hohn have generated over £956m for their Children’s Investment Fund Foundation (CIFF). And the Scottish Billionaire Sir Tom Hunter has promised to donate over £1bn to charity in the course of his lifetime.

Bill Gates, by comparison, is understood to have given over $28 billion to charity so far, but as yet no figure has been quoted for the total sum represented by those involved with The Giving Pledge. That said, however easily dismissed as an albeit typically American marketing exercise, there can be no denying how effectively The Giving Pledge has consolidated the philanthropic ambitions of some of the most successful families and individuals in the U.S..

Could such an initiative on these shores raise the profile of charitable giving and gently prick the consciousness of those in a position to do so much good?

Bill Gates certainly thinks so. Much of what he spends his time doing these days is around learning and education and he believes that the Giving Pledge, particularly in attracting younger entrepreneurs such as Facebook’s Zuckerberg to charitable giving, is merely an extension of that.

“We think a lot of people miss the opportunity to do philanthropy; to do it younger, to get more engaged, to give a higher percentage of their money to it, and part of that is that it’s not that easy to learn. Everybody has a cause, but who do you talk to that has had a similar experience and can really share that overall it’s a fun, positive thing.”    

*http://www.philanthropycapital.org/
**https://www.cafonline.org/media-office/press-releases/2010/comment-on-the-giving-pledge.aspx
***http://online.wsj.com/article/SB10001424052748704554104575435481403466748.html
****Figures from accounts filed at the Charity Commission.