Bill and Melinda Gates divorce could shake up philanthropy – Honolulu, Hawaii

Honolulu, Hawaii 2021-05-05 01:05:00 –

Bill and Melinda Gates may want to keep the pending divorce private, but the division between the billionaire co-founders of the world’s largest private foundation should have very public consequences. And the division is already sending a wave of uncertain uncertainty in the world of philanthropy and community health.

The Bill & Melinda Gates Foundation has a donation of nearly $ 50 billion and contributes approximately $ 5 billion annually to activities around the world. Last year, we donated $ 1 billion to fight COVID-19 through vaccination.

In a statement after Gates announced the divorce on Twitter, the Foundation said the two remained co-chairs and trustees and no organizational changes were planned.

“They continue to work together to develop and approve Foundation strategies, advocate Foundation issues and set the overall direction of the organization,” said the Foundation.

Despite such guarantees, some say they are worried that the split could shake the Foundation’s plans. Gates has not signed a prenuptial agreement, but has a separation contract, according to a submission to the King County Superior Court on Monday.

In 2010, the couple promised to donate most of Forbes’ estimated $ 133 billion in property to the Foundation. Divorce lawyers say the promised money is no longer considered the property of the couple. Still, it is unclear how divorce will affect future donations to the Foundation.

Benjamin Soskis, a philanthropist historian and senior researcher at the Urban Institute, said: “More importantly, this reflects this new era in which these enthusiastic living donors actually dominate the landscape in a way that was less than a century old.”

Through their philanthropy, Gates reshaped their attitude towards the ultra-rich duty to harness their vast fortune in a lasting way for the public good. A few years ago, they created the Giving Pledge with Warren Buffett and persuaded billions of fellow people to promise to give them most of their wealth.

Lindsay Magoy, author of “There is no such thing as a free gift: the Gates Foundation and the price of philanthropy,” said that such a couple’s division in the past sometimes caused devastating changes in the Foundation. The world has suggested that it is likely to be concerned about divorce.

When British hedge fund billionaire Chris Horn and his wife Jamie Cooper divorced in 2013, their charity, the Children’s Investment Fund Foundation, ran into financial problems. The dissolution also sparked a lengthy court battle over whether another member of the fund should vote to approve a $ 360 million grant to a new charity founded by Cooper. The British Supreme Court finally ruled last year that Cooper’s initiative, Big Win Philanthropy, should be funded.

“People can really emphasize the instability surrounding private donations and the fact that private donations are highly dependent on the whims of the couple when such a divorce occurs. I’m afraid, “said McGoey. “The fact that we really do not know the long-term effects of this divorce on the Foundation is that we rely too much on the whims of the wealthy as a society and voluntarily distribute their excess wealth. Emphasizes the fact that it becomes. “

At the same time, some experts say that Gates, who married in Hawaii on New Year’s Day 1994, has pursued unique interests within the Foundation, not just their own mutual funds. Since 2008, Bill Gates has the Gates Ventures. And in 2015, Melinda Gates founded Pivotal Ventures, which focuses on helping women and families in the United States.

“In a sense, they are already separated,” Soskis said. “They have already emerged as two different individuals with different approaches and focus areas. And in a sense, they already have a clear line, making divorce easier in an institutional setting. May do. “

But one of the obvious changes is that when Bill and Melinda Gates tackled the problem together, a couple of people in the ultimate power of philanthropy naturally paid great attention to it. Especially in recent years, Soskis said the impact of Melinda Gates on the Foundation could be seen in its approach to education funding and gender equality issues.

“She did this not only in a closed room, but also by becoming someone who made Bill Gates a kind of temper,” Soskis said. “It’s actually part of her public character, her public identity, and we could all see it happening.”

A dominant player in development and global health, the Foundation exerts significant influence as the largest private donor to the World Health Organization. That’s why recent comments from Bill Gates on the protection of intellectual property rights of coronavirus vaccine makers have upset some global health professionals. Gates opposed sharing the intellectual patent for the COVID-19 vaccine and argued that the shot manufacturing process required scrutiny. Some critics blamed his feelings of prioritizing profit over supply.

Lawrence O. Gostyn, a professor of global health law at Georgetown University, said: “It’s not just a secondary problem. It’s the most serious problem the world faces today.”

Since the Foundation is a long-established organization with a large professional staff, experts say that the changes that can occur due to divorce are incremental and likely to occur over a long period of time. I will.

McGoy argues that the shake-up may also be beneficial to the Foundation, which is managed by three trustees, Gates and Buffett. “Having an organization that is very closely run by a small number of people is not always good for generating diverse ideas and broadly expressing different ideological perspectives,” she suggests. did.

Questions have been raised about how divorce affects the couple’s pledge to donate most of their wealth to the Foundation, but a New York-based divorce lawyer who has worked with high net worth clients. Concerns Susan Moss says it shouldn’t.

According to Moss, philanthropy usually has three tests to determine how it works in divorce proceedings.

“Both spouses need to know about it, both spouses need to agree, and the commitment must be made in advance, not immediately after the divorce,” she said. “In this case, all three prongs are filled.”

“The money donated to the Foundation will continue to be donated to the Foundation,” she added. “It probably won’t hold up because there’s a lot of evidence that each party knows, each party agrees, and it’s not just after the divorce.”

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