The Greatest Gifts Of All
At $65 billion and counting, the Top 50 donors in BusinessWeek's annual ranking of America's leading philanthropists have already given an enormous amount of their money to charity over the course of their lifetimes. This year many supersized their donations. Even more important, younger donors are changing the way they give, transforming the model of philanthropy. And corporations, too, are seeing philanthropy in a new light -- as a means to boost employee health, morale, and loyalty at a time of rising hostility overseas.
First, the mega-givers. Warren E. Buffett's late wife, Susie, left $2.5 billion to the Omaha-based foundation she shared with her husband, and Bill and Melinda Gates gave an estimated $3 billion to their foundation -- one of the largest gifts in history by living donors. Liquor importer Sidney E. Frank gave Brown University, from which he dropped out because he couldn't afford the tuition, its largest gift ever -- $100 million to fund scholarships for 130 students a year. Related Cos. Chief Executive Stephen M. Ross pledged $100 million to the University of Michigan Business School, the largest gift in the university's history.
EBay Inc.'s (EBAY ) founder and chairman, Pierre Omidyar, went beyond the numbers game by creating an entirely new model for giving. Using a bottom-up approach, much like eBay's online marketplace does itself, Omidyar Network funnels small grants to people who use the Web to ask for help for specific projects. Most of the money goes to nonprofit organizations. The rest goes to for-profit companies. Omidyar is also using the Internet to allow ordinary people of modest means to donate money directly to projects around the world.
Global philanthropy grew in importance for corporations this year. With corporate operations, revenues, and profits all growing in Asia and other parts of the world, companies are shifting a larger share of their philanthropy abroad. It's a form of social insurance. IBM (IBM ), for example, boosted its global contributions to 30.4% from 12.4% in 2000.
Unfortunately, those individuals who came into wealth in the 1990s still donate little of it. On average the nation's richest 1% own 41% of the country's wealth, yet donate only 2% of their incomes each year to charity. More needs to be done. This year's top donors are showing the way.