Shomporko Online News Desk: Warren Buffett resigned as a trustee of the Bill and Melinda Gates Foundation on Wednesday and the foundation says it will unveil plans in July to address questions raised about its leadership structure as it deals with its two founders’ divorce.
Buffett’s news comes just weeks after Bill and Melinda Gates announced their divorce after 27 years of marriage but that they will continue to manage one of the world’s greatest philanthropic foundations together. Buffett was one of three members of the foundation’s board of directors with Bill and Melinda Gates being the other two.
“For years I have been a trustee — an inactive trustee at that — of only one recipient of my funds, the Bill and Melinda Gates Foundation (BMG). I am now resigning from that post, just as I have done at all corporate boards other than Berkshire’s,” Buffett said in a prepared statement Wednesday. “The CEO of BMG is Mark Suzman, an outstanding recent selection who has my full support. My goals are 100 per cent in sync with those of the foundation and my physical participation is in no way needed to achieve these goals.”
Buffett, the chairman, and chief executive of Berkshire Hathaway also said that he is halfway to reaching his goal of giving away the entirety of his shares in the conglomerate and that he’s donating another $4.1 billion in shares to five foundations through the lion’s share that went to the Bill and Melinda Gates Foundation. In Buffett’s donation announced Wednesday it received more than $3.2 billion, bringing his total giving to the foundation to nearly $33 billion, Suzman said in a statement.
“I know Warren’s departure raises questions about the foundation’s governance,” Suzman said, adding he has been “actively discussing with him, Bill and Melinda approach to strengthen our governance to provide long-term stability and sustainability for the foundation’s governance and decision-making in light of the recent announcement of Bill and Melinda’s divorce. I plan to share additional information in July.”
The Bill and Melinda Gates Foundation has a trust endowment of about $50 billion and around 1,600 employees having funded work in 135 countries. There have been calls in philanthropy circles to diversify the foundation’s board and critics have long pointed out that decision-making is concentrated in very few hands at the foundation which they say has outsized influence in public health and other fields.
“Big foundations need strong oversight. The Gates Foundation has a lot of power and to have so few people who are playing a governance role is just problematic,” said David Callahan, the founder of the Inside Philanthropy website and author of “The Givers: Wealth, Power and Philanthropy in a New Gilded Age.”
Now that Buffett is stepping down, Melissa Berman, the president & CEO of Rockefeller Philanthropy Advisors, notes it gives the foundation an opportunity to think about its governance for the long run.
“Organizations are looking to bring a more diverse range of expertise and experiences into their governance,” Berman said. “A larger board would help position the Gates Foundation for deeper impact in global health, economic opportunity, and education.”
Bill and Melinda Gates said in separate statements Wednesday that they were grateful for Buffett’s leadership, generosity, and friendship. “His wisdom has been a guiding light through our foundation’s second decade, and the things we’ve learned from him will continue to help us chart a way forward,” said Melinda Gates.
Buffett had faced criticism after ProPublica reported earlier this month that some of the country’s wealthiest people have paid no income tax, or nearly none, in some years. Using perfectly legal tax strategies, the report said Buffett paid less than 10 cents for every $100 he added to his wealth from 2014-2018.
He said Wednesday he currently holds about $100 billion in shares of Berkshire Hathaway and that the $41 billion he has previously donated in shares has saved him only $0.40 in taxes per $1,000 given.
“That’s because I have relatively little income,” he said. “My wealth remains almost entirely deployed in tax-paying businesses that I own through my Berkshire stock holdings, and Berkshire regularly reinvests earnings to further grow its output, employment, and earnings.”
But, he did not address growing questions raised about the structure of the foundation’s leadership after reports of Bill Gates’ behavior in the workplace.
It was recently revealed that board members at Microsoft Corp. made a decision in 2020 that it wasn’t appropriate for Gates, the company’s co-founder, to sit on its board as they investigated the billionaire’s prior romantic relationship with a female Microsoft employee that was deemed inappropriate.
The Bill and Melinda Gates Foundation has said that it is not investigating the allegations in the media, as the reported incident involving one of the world’s largest, most influential nonprofits was made by “an anonymous former employee.”
Buffett, at 90, has resigned from all other business boards outside of Berkshire Hathaway in recent years, although he has stated that he has no plans to step down as Berkshire’s CEO. Berkshire selected the person who will eventually succeed Buffett as the company’s CEO earlier this year, but he is not retiring.
“I’m definitely participating in a game that, for me, has progressed into the fourth quarter and into overtime,” Buffett remarked Wednesday, adding that he still enjoys his job.
Source_The Associated Press