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Bill and Melinda Gates Foundation |
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| Founders | Bill & Melinda Gates |
|---|---|
| Founded | 2000 |
| Headquarters | Seattle, Washington |
| Staff | Bill Gates, co-founder and co-chair Melinda French Gates, co-founder and co-chair William H. Gates, Sr., co-chair Jeff Raikes, CEO |
| Area served | Global |
| Focus | Education, Healthcare, Ending poverty |
| Method | Donations and Grants |
| Endowment | US$38.7 billion |
| Employees | 6861 |
| Website | www.gatesfoundation.org |
The Bill & Melinda Gates Foundation (B&MGF) is the 4th largest transparently operated2 private foundation in the world, founded by Bill and Melinda Gates in 2000 and doubled in size by Warren Buffett in 2006. The primary aims of the foundation are, globally, to enhance healthcare and reduce extreme poverty, and, in the United States, to expand educational opportunities and access to information technology. The foundation, based in Seattle, Washington, is controlled by its three trustees: Bill Gates, Melinda Gates, and Warren Buffett. Other principal officers include Co-Chair William H. Gates, Sr. and Chief Executive Officer Jeff Raikes. It has an endowment of US$38.7 billion as of December 31, 2007.1 The scale of the foundation and the way it seeks to apply business techniques to giving makes it one of the leaders in the philanthrocapitalism revolution in global philanthropy.3 In 2007 its founders were ranked as the second most generous philanthropists in America.4
In 2006 the Foundation won the Prince of Asturias Award for International Cooperation 5
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The foundation was initially funded by Bill Gates with US$126 million in 2000. During the foundation's first two years, funding grew to US$2 billion. The B&MGF was endowed by Bill Gates, chairman and founder of Microsoft and his wife, Melinda Gates in January 2000, through the merger of the Gates Learning Foundation and the William H. Gates Foundation. The Gates Learning Foundation was formed out of the Gates Library Foundation, which was founded in 1996, as an outgrowth of the Microsoft Libraries Online initiative.6 On June 15, 2006, Gates announced his plans to transition out of a day-to-day role with Microsoft, effective July 31, 2008,7 to allow him to devote more time to working with the foundation.
Bill and Melinda Gates, along with the musician Bono, were named by TIME as Persons of the Year 2005 for their charitable work. In the case of Bill and Melinda Gates, the work referenced was that of this foundation. On May 4, 2006, the foundation received the Prince of Asturias award for International Cooperation.8
On June 25, 2006, Warren Buffett (then the world's richest person, estimated worth of US$62 billion as of April 16, 2008) pledged to give the foundation approximately 10 million Berkshire Hathaway Class B shares spread over multiple years through annual contributions, worth approximately US$30 billion in 2006.9 Buffett set conditions so that these contributions do not simply increase the foundation's endowment, but effectively work as a matching contribution, doubling the Foundation's annual giving: "Buffett's gift came with three conditions for the Gates foundation: Bill or Melinda Gates must be alive and active in its administration; it must continue to qualify as a charity; and each year it must give away an amount equal to the previous year's Berkshire gift, plus another 5 percent of net assets. Buffett gave the foundation two years to abide by the third requirement."10 The Gates Foundation received 5% (500,000) of the shares in July 2006 and will receive 5% of the remaining earmarked shares in the July of each following year (475,000 in 2007, 451,250 in 2008).1112
As of 2006, the foundation has an endowment of approximately US$34.6 billion. To maintain its status as a charitable foundation, it must donate at least 5% of its assets each year.13 Thus the donations from the foundation each year would amount to over US$1.5 billion at a minimum.
The Foundation has been organized, as of April 2006, into four divisions, including core operations (public relations, finance and administration, human resources, etc.), under Chief Operating Officer Cheryl Scott, and three grant-making programs:
Under a probably new program, The Bill and Melinda Gates Foundation will give hundreds of millions of dollars in the next few years to programs aimed at encouraging saving by the world's poor, the Wall Street Journal reported14.
The President of the Global Health Program is Tachi Yamada. The Gates Foundation has quickly become a major influence upon global health; the approximately US$800 million that the foundation gives every year for global health approaches the annual budget of the United Nations' World Health Organization (193 nations) and is comparable to the funds given to fight infectious disease by the United States Agency for International Development.15 The Foundation currently provides 17% (US$86 million in 2006) of the world budget for the attempted eradication of poliomyelitis (polio).16
The Global Health Program's other significant grants include
President Sylvia Mathews leads the Global Development Program, which combats extreme poverty through grants such as the following:
The Foundation's Special Initiatives include responses to catastrophes as well as learning grants, which are used to experiment with new areas of giving. Currently, the Foundation is exploring water, hygiene and sanitation as a new focus within Global Development.
Under President Allan Golston, the United States Program has made grants such as the following:
In 1997, the foundation introduced a U.S. Libraries initiative with a goal of "ensuring that if you can get to a public library, you can reach the Internet." The foundation has given grants, installed computers and software, and provided training and technical support in partnership with public libraries nationwide.
Most recently, the foundation gave a $12.2-million grant to the Southeastern Library Network (SOLINET) to assist libraries in Louisiana and Mississippi on the Gulf Coast, many of which were damaged or destroyed by Hurricanes Katrina and Rita.
In October 2006 the Bill & Melinda Gates Foundation was split into two entities: the Bill & Melinda Gates Foundation Trust, which manages the endowment assets and the Bill & Melinda Gates Foundation, which "... conducts all operations and grantmaking work, and it is the entity from which all grants are made."3132 Also announced was the decision to "... spend all of [the Trust's] resources within 50 years after Bill's and Melinda's deaths."33343536 This would close the Bill & Melinda Gates Foundation Trust and effectively end the Bill & Melinda Gates Foundation. In the same announcement it was reiterated that Warren Buffett "... has stipulated that the proceeds from the Berkshire Hathaway shares he still owns at death are to be used for philanthropic purposes within 10 years after his estate has been settled."33
The plan to close the Foundation Trust is in contrast to most large charitable foundations that have no set closure date.citation needed This is intended to lower administrative costs over the years of the Foundation Trust's life and ensure that the Foundation Trust not fall into a situation where the vast majority of its expenditures are on administrative costs, including salaries, with only token amounts contributed to charitable causes.34
Seattle Times quotes37:
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As with all good parodies, there's a grain of truth in a fake news story on the Web that says Bill Gates could face another antitrust investigation — this time for "monopolistic charity practices." "The danger isn't in what people do tell you — it's in what they don't," departing foundation CEO Patty Stonesifer warned in the 2007 annual report. In other words, Stonesifer says, the Gates Foundation needs honest feedback and criticism to help it figure out how best to improve the health of the world's poor, boost food production in Africa and improve schools in the U.S. Honesty can be hard to come by, though, when you're handing out staggering amounts of cash. |
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The Gates Millennium Scholars fund, according to its official website's frequently asked questions section, only provides scholarships to African American, American Indian/Alaska Native, Asian, Pacific Islander American or Hispanic American applicants.38.
An op-ed by Ernest W. Lefever, published in the Los Angeles Times on November 1, 1999, criticized the program for its exclusion of Caucasians:
"America's most celebrated college dropout had a great opportunity to boost higher education, help needy students and strike a blow against racism, but he blew it. If Bill Gates had been able to chat with Teddy Roosevelt before launching his breathtaking $1-billion program of college scholarships, America would be a better place. Unless significantly amended, Gates' 'minority' scholarships will further inflame racial tensions, delay the achievement of a colorblind society and subvert the cherished virtue of reward by merit. The Gates Millennium Scholarships for thousands of high school seniors over the next 20 years are intended to produce more scientists, engineers, doctors and educators from among American minorities, who, he claims, are woefully underrepresented in college. His commitment to arbitrarily preferred groups is bound to increase racial resentment. Gates' vague concept of 'diversity' confuses the laudable diversity of cultural talents that strengthens the nation with the self-conscious racial diversity that divides it by breeding arrogance and envy."39
The foundation invests the assets that it has not yet distributed, with the exclusive goal of maximizing the return on investment. As a result, its investments include companies that have been criticized for worsening poverty in the same developing countries where the Foundation is attempting to relieve poverty. These include companies that pollute heavily and pharmaceutical companies that do not sell into the developing world.40 In response to press criticism, the foundation announced in 2007 a review of its investments to assess social responsibility.41 It subsequently cancelled the review and stood by its policy of investing for maximum return, while using voting rights to influence company practices.42
In a January/February 2007 Foreign Affairs article, Laurie Garrett claims that many charitable organizations, among whom the Gates Foundation is prominent, harm global health by diverting resources from other important local health care services.43 For example, by paying relatively high salaries at AIDS clinics, the foundation diverts medical professionals from other parts of developing nations' health care systems; the health care systems' ability to provide care diminishes (except in the area the foundation funds) and the charities may do more harm than good. Similar findings were reported in a December 2007 Los Angeles Times investigation.44
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