Omaha: Investor Warren Buffett announced another $5.3 billion in charitable gifts on Friday, marking a significant shift in his longtime giving strategy. After his death, Buffett plans to cut off donations to the Bill & Melinda Gates Foundation and leave the distribution of his $128 billion fortune to his three children.
A Shift in Philanthropic Strategy
Since outlining his giving plan in 2006, Buffett has donated about $55 billion worth of Berkshire Hathaway stock to five foundations, with the Gates Foundation receiving the largest share. The remaining foundations are affiliated with his family, including ones managed by each of his children. Buffett left the Gates Foundation’s board in 2021 following the divorce announcement of Bill and Melinda French Gates, and French Gates left the foundation earlier this year.
Changing His Will
In his 2006 pledge, Buffett indicated that the Gates Foundation would be included in his will, with provisions for the continuation of his annual Berkshire stock gifts after his death. However, he announced on Friday that his original pledges are valid only until his death. Afterward, his children will decide the future distribution of his Berkshire stock, adhering to the philanthropic goal of helping those less fortunate.
Appreciation from the Gates Foundation
Mark Suzman, CEO of the Gates Foundation, expressed gratitude for Buffett’s generosity, noting his significant contributions and advice over the past 18 years. Buffett’s donations, now worth more than $43 billion, have been instrumental in shaping the foundation’s mission to improve global health and productivity.
Continued Philanthropy
Buffett emphasized that 99% of his estate is designated for philanthropic use. His own Susan Thompson Buffett Foundation has supported abortion rights, while his son Howard has directed over $500 million to aid Ukraine. Buffett occasionally makes undisclosed gifts to other charities as well.
Maintaining Control Over Berkshire Hathaway
After giving away a little over 13 million Class B shares on Friday, Buffett will still hold 207,963 Class A shares and 2,586 Class B shares, ensuring he retains significant voting power in Berkshire Hathaway’s operations. He hasn’t bought or sold any Berkshire shares in 18 years.
Succession Plans
Greg Abel, one of Buffett’s vice chairmen who oversees all non-insurance businesses, is set to succeed him as CEO. Howard Buffett, already on Berkshire’s board, will become chairman after his father’s death. However, Buffett’s children will not be involved in the day-to-day operations of the conglomerate, which includes a diverse portfolio of companies such as BNSF railroad, Dairy Queen, Geico, and significant stock holdings in Apple, Coca-Cola, American Express, and Bank of America.
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