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Warren Buffett resigns from Gates Foundation, has donated half his fortune

Published 06/23/2021, 07:49 AM
Updated 06/23/2021, 05:02 PM
© Reuters. FILE PHOTO: Warren Buffett, CEO of Berkshire Hathaway Inc, pauses while playing bridge as part of the company annual meeting weekend in Omaha, Nebraska U.S. May 6, 2018. REUTERS/Rick Wilking
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By Jonathan Stempel and Eva Mathews

(Reuters) -Billionaire investor Warren Buffett said he is resigning as a trustee of the Bill and Melinda Gates Foundation, and has donated half his wealth to philanthropy since pledging 15 years ago to give away his fortune from running Berkshire Hathaway Inc . (NYSE:BRKa)

Buffett, 90, said in a Wednesday statement he has been an "inactive trustee" for years at the foundation, but fully supported Chief Executive Mark Suzman and that their goals were "100% in sync."

He did not explain why he is resigning, while noting he has given up all directorships outside Berkshire, reducing his workload.

Buffett also announced a new donation of more than $4.1 billion, comprising nearly 15.2 million Berkshire Class "B" shares, to the Gates Foundation and four family charities, part of his pledge to give away 99% of his net worth.

He has since 2006 donated more than $41.5 billion of Berkshire shares, including $32.7 billion to the Gates Foundation. The overall total is now equivalent to about $100 billion because Berkshire's stock price has risen.

"Over many decades I have accumulated an almost incomprehensible sum simply by doing what I love to do," Buffett said. "Society has a use for my money: I don't."

Founded in 2000, the Gates Foundation focuses on combating poverty, disease and inequity, spending $54.8 billion in its first two decades.

Its future has been uncertain since its namesake co-founders said last month they were divorcing after 27 years of marriage.

Microsoft Corp (NASDAQ:MSFT) later said it had reviewed an accusation that Bill Gates had tried in 2000 to have an intimate relationship with an employee.

GOVERNANCE COMMITMENT

In an email to Gates Foundation employees, Suzman said he has discussed with Buffett and the Gateses how to strengthen governance and decisionmaking, and planned to share more information in July.

"I am fully committed to following [Buffett's] guidance to ensure we are the best possible stewards of his, Bill, and Melinda's resources," Suzman said.

In statements released by the foundation, Bill Gates said he was grateful for his "enduring friendship" with Buffett and that "we will always have a deep sense of accountability" to him, while Melinda French Gates said Buffett's teachings will help "chart a way forward."Berkshire did not immediately respond to a request for comment.

Buffett's donations also go to the Susan Thompson Buffett Foundation, named for his late first wife, and charities run by his children Howard, Susan and Peter: the Howard G. Buffett Foundation, the Sherwood Foundation and the Novo Foundation.

Had Buffett not made his donations, his fortune would roughly equal that of Amazon.com Inc (NASDAQ:AMZN) founder Jeff Bezos, the world's richest person according to Forbes magazine.

Bill Gates and Buffett also pioneered "The Giving Pledge," where more than 200 people like Michael Bloomberg, Larry Ellison, Carl Icahn, Elon Musk, Mark Zuckerberg and Saudi Prince Alwaleed bin Talal have committed at least half their fortunes to philanthropy.

NO 'SWAN SONG'

Buffett has since 1965 built Omaha, Nebraska-based Berkshire into a more than $600 billion conglomerate, owning businesses such as the BNSF railroad and Geico auto insurance, and stocks such as Apple Inc (NASDAQ:AAPL).

He still holds 31.5% of Berkshire's voting power, even after the donations.

Buffett's statement on Wednesday also addressed recent criticism after a ProPublica investigation included him among wealthy people who paid low taxes.

Buffett said his donations have resulted in only about 40 cents of tax savings per $1,000 given.

"Nevertheless, tax deductions are important to many - particularly to the super-rich - who give large amounts of cash or securities to philanthropy," he said.

© Reuters. FILE PHOTO: Berkshire Hathaway CEO Warren Buffett (R) shows his friend Microsoft co-founder Bill Gates the finer points of newspaper tossing, prior to the Berkshire annual meeting in Omaha, Nebraska May 2, 2015.  REUTERS/Rick Wilking

Buffett also used references to American football to assure fans he has no plans to step away, including from Berkshire.

"These remarks are no swan song," he said. "I still relish being on the field and carrying the ball. But I'm clearly playing in a game that, for me, has moved past the fourth quarter into overtime."

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