Prof. Buffett’s Lesson on Charity
Throughout his illustrious career, Warren Buffett has made some incredible investments that helped him amass a fortune that today makes him the second richest man in America.
However, despite acquiring such an impressive mountain of wealth valued in the billions, the financier lives a famously frugal life.
Rather than spending the money he has earned on a fleet of sports cars, big houses or other luxuries, the Oracle of Omaha has opted for many of life’s simpler pleasures. This includes a conservative home in Nebraska and a glass of Cherry Coke. However, while Buffett’s cost of living is low, his wealth is not going to waste.
On the contrary, aside from being known as one of the world’s greatest investors and wealthiest individuals, he is known as one of the world’s most generous philanthropists. Through donations, auctions and other means, the financier has assisted numerous organizations in need.
Buffett runs his own organization, the Susan Thompson Buffett Foundation, which assists college-bound students in Nebraska. The foundation, formerly known as The Buffett Foundation, was changed in homage to her after she passed away in 2004.
Though the Nebraska-based organization bears the investor’s surname, the bulk of Buffett’s charitable donations will not go to this program. Rather, in 2006, Buffett made headlines when he offered a staggering gift in the form of 85% of his entire Berkshire Hathaway(BRK.A) holdings to the Bill and Melinda Gates Foundation. At the time of the announcement this gift was valued at $37 billion.
The Bill and Melinda Gates Foundation, which was established by the Microsoft(MSFT) founder and his wife, works to battle global disease and poverty as well as fund U.S. education projects.
However, not all of Buffett’s philanthropic gifts are monetary. Buffett has also used his impressive following to help charitable organizations through various auctions.
Earlier this month, Buffett sat down to lunch with a small group of executives from Salida Capital, a Toronto-based hedge fund. The group had won a chance to wine and dine with the legendary investor when they bid $1.68 million in an auction last year.
The money raised from this lunch was donated to the Glide Foundation, which provides aid to San Francisco’s homeless and poor.
Buffett has also offered his helping hand in other ways. At the close of 2009 it was announced that the financier would co-chair a committee led by Goldman Sachs(GS), aimed at assisting U.S. small business owners build their companies.
The 10,000 Small Businesses program is designed to provide small businesses in the United States with access to funds, education and networking opportunities in hopes of increasing productivity and getting them back on their feet. Goldman CEO Lloyd Blankfein, Buffett and Dr. Michael Porter of Harvard Business School are on the Advisory council which is responsible for the development, execution and evaluation of the program.
Despite the long time he has resided in the upper tier of society, Buffett has not forgotten about the less fortunate.
Prior to the meal he shared with Salida executives, Buffett told Bloomberg that the need for charitable giving is unlimited. Whether on Wall Street or Main Street, this is one Buffett lesson we can all take to heart.
