Billionaires around the world are tremendously donating a significant portion of their personal wealth to charitable causes. Ratan Tata, Bill Gates, Michael Bloomberg, and Warren Buffet are a few names who are known not only for their successful business but also for impact-driven philanthropy causes.
A business tycoon and leading philanthropist, Ratan Tata, who is well-known for his noble causes and commitment to social responsibility, has more than 65% of his shares invested in charitable trusts. During the vicious cycle of the COVID-19 period, he pledged Rs. 1500 crore to fight the pandemic.
Microsoft founder and billionaire Bill Gates couldn’t resist helping the poor children dying in poor countries after reading an article in the newspaper in 1997. Since 2000, the ‘Gates Foundation’ has spent over $53.8 billion fighting global health crises. His habit of voracious reading helped him decide the areas that needed his attention the most.
Similarly, Warren Buffet, founder of Berkshire Hathaway, the world’s top philanthropist, donated roughly $4 billion worth of his conglomerate Berkshire Hathaway’s stock to charitable foundations. Buffet’s lifetime giving tops $515 billion – placing him at the top of Forbes’ 2023 list of America’s most generous philanthropists.
With each passing year, as global inequality widens, these iconic philanthropists donate a major chunk of their money to global causes, which has made a great positive impact worldwide. As social issues become a major challenge, the increasing number of philanthropists not only donate but donate strategically, considering the impact first, raising the concept of impact-led philanthropy. The practice of thoughtfully and intentionally using time, talent, and resources to provide in numerous ways that advance equity, effectiveness, and system change at a large level is regarded as impact-led philanthropy.
Mindsets Towards Impact-Driven Philanthropy
According to Forbes India, “Embracing not only a “today forward” approach but also a “future back” lens to planning your philanthropic journey.” The ‘today forward’ approach begins with the status quo and builds a philanthropic plan step-by-step from there. On the contrary, the ‘future back’ approach starts with a vision of the future state and works backwards. Eventually, a balanced amalgamation of both these approaches is needed to enhance the effectiveness of giving.
Not to mention, the wealth gap between the rich and the poor has been in existence since time immemorial. In an attempt to curb the wealth gap, many of the world’s billionaires donated a wide percentage of their earnings to help tackle societal ills like inadequate education, fatal diseases, and malnutrition.
Take the example of Michael Bloomberg, co-founder of Bloomberg, who has been a keen philanthropist and decided to start his own foundation, which focused on environmental, educational and art causes in 2009. In 2014, he established an initiative called Vibrant Oceans, supporting the creation and maintenance of sustainable fish populations globally. According to the World Finance report, Bloomberg has donated an estimated $6bn to charitable causes, equating to 12 percent of his net wealth.
The major focus of philanthropists should be on outcomes, not only the inputs, to assess the effectiveness of their charity. For any philanthropist, having a fine understanding of how these inputs achieve desired outputs prioritises impact, ultimately enhancing the effectiveness of future giving.
According to Forbes India, “collaborating with other philanthropists and institutions and leveraging networks to help nonprofits grow, lending your voice to promoting philanthropy among peers are equally, if not important, approaches to multiplying your philanthropic impact.” It was revealed that 80% of the philanthropists interviewed adopted this approach to make a significant impact through their charity worldwide.
These philanthropists embrace the promise of impact-driven philanthropy – together, which can create better outcomes and a brighter future – for society and the world. We need many more iconic philanthropists like Ratan Tata, Bill Gates, and Warren Buffet, who are woven with resilience, passion, and an unwavering commitment to driving change in society to a great extent.
