Most billionaires joining Warren Buffett's Giving Pledge are penning pledge letters, explaining their motivations. Here are highlights from the recent class.
By Anne VanderMey, reporter
What do Facebook co-founder Mark Zuckerberg, real estate baron and failed senate candidate Jeff Greene and Wall Street mogul Carl Icahn have in common?
If you said they’re very rich, you’re right. But that’s not all. They’re all part of the Giving Pledge, the campaign initiated by Warren Buffett and Bill and Melinda Gates to line up commitments from billionaires to give at least half of their wealth to charity during their lifetimes or at their death.
At the tail end of 2010, Zuckerberg, Greene and Icahn were among the latest round of billionaires to add their names, along with 15 others, to the list of 57 families making the a commitment to donate most of their fortunes. The commitment is not legally binding, but if honored, it could have widespread impact. A Fortune story that broke the news of the campaign earlier this year estimated that if everyone in the Forbes 400 signed on, at a minimum $600 billion could eventually be pumped into charities worldwide — double what the entire United States currently gives in a year.
Who are these billionaires giving vast sums of money? To get an idea, Fortune read through the pledge letters of the 18 most recent signees. As it turns out, despite their varied backgrounds and industries, many of the donors can count more in common than having vast sums of wealth and plans to give it away.<!-- more -->
Bootstraps for all
Some of the more famous recent donors, notably Zuckerberg and Morningstar founder Joe Mansueto, did not write pledge letters. But of the 12 donors who did, the most resonant recurring theme in their letters was the writers' rags-to-riches stories. Many billionaires on the list made themselves from nothing, and are planning on asking their children to do the same.
About half of the writers in this round of pledges referred to their modest backgrounds. Developer George P. Mitchell was born to Greek immigrant parents and came of age during the Great Depression. Sidney Kimmel was inspired by his father’s willingness to share the family’s “meager means.” And Leon “Lee” Cooperman of Omega Advisors is the son of a plumber who worked in the South Bronx.
“I started with absolutely nothing,” Greene wrote in his letter, “and I’ve certainly lived the American dream.” Greene, like many of the writers, acknowledged a responsibility to enable others to climb the same ladder. But the state of the American dream today is less sound, he writes, “We have a lot of work to do as a country to revitalize our economy, so that the opportunities I had are available to each and every American.”
Running the numbers on the most recent letters, we found that the most frequently used word (after “our,” “giving,” “others,” “pledge,” etc.) was “education,” which got 13 mentions. (While most donors didn’t specify their cause of choice, for those who did, healthcare was an easy runner-up.)
The dysfunction of America’s K-12 system has been a concern for the Gates Foundation for years. Here, billionaires like Carl Icahn join in — and how.
Writes Icahn: “I believe, without significantly changing the method we use to educate our young students in this country, we will soon lose our hegemony.”
Whether the donors are explaining their history of giving, or issuing a reminder that they’re not coming to philanthropy just because of a dinner with Warren Buffett, the word “foundation” tied with “education” for most-mentioned.
A foundation of one’s own may come with the territory for the rich and generous, but critics of the Pledge say foundations could actually lessen the impact of the donations. That’s partially because the money used to endow them means less cash now for people who need it. And partially because much of the money was already destined for charitable causes before the donors joined the Giving Pledge group.
IMG Chairman and CEO Ted Forstmann wrote he’d been “quietly doing my own version of ‘the giving pledge’” for years. Greene said that he’d long planned to donate 80% of his estate, and only hesitated to join the giving pledge initially because as a Senate candidate, “it would have looked like I was trying to exploit this for political gain.” Kimmel mentioned that he had “fulfilled that pledge already, having given more than half my wealth to charitable causes.” And Hobby Lobby founder David Green wrote that “the idea of giving back has been part of my life as long as I can remember.”
Dinner with Mayor Mike
In his letter, the force behind the Giving Pledge isn’t just more money for charity — it’s also peer pressure.
Forstmann credited New York City Mayor Michael Bloomberg, an early pledge adopter, with persuading him to join the group, and said he hoped to do some of his own recruiting.
“I’ve tried to live by the motto ‘you save one life and you save the world,’" he wrote. "I hope that by joining ‘The Giving Pledge’ it will encourage others to do the same.” Icahn also said that he hoped to “inspire others” to similar commitments, and AOL co-founder Steve Case concurred, writing that he hoped the campaign would “inspire many others.”
The Giving Pledge can trace its roots to what Fortune called the “First Supper,” a dinner hosted by David Rockefeller at which Gates and Buffett pitched a group of their fellow billionaires on the idea. After that inaugural dinner, it appears the parties never stopped. After a Bloomberg dinner, Cooperman wrote in a letter to Buffett that he and his wife “very much enjoyed our dinner with you, Bill, Melinda and Mayor Mike. The graciousness of the Mayor’s hospitality was matched only by the interesting guests and the quality of the dinner conversation!” Buffett and Greene meanwhile had a conversation about the pledge at the premiere of “Wall Street: Money Never Sleeps.”
But despite the glamour of the settings in which the billionaires were wooed, some are still immune to the charms of the Oracle of Omaha. Foreign businessmen seem to have been more hesitant about signing up (though Chinese multi-millionaire Chen Guangbiao reportedly secured anonymous pledges from 100 entrepreneurs), and it’s rumored that about a third of the Chinese superrich invited to a dinner with Buffett and Gates in Beijing passed on the invitation.
Editor's note: An incompletely edited version of this article was previously posted on this page. It has been replaced.
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