Warren Buffett, the second richest man on the planet, is to give almost all his $44bn (£24bn) fortune away - to a charity run by the world's richest man.
The decision will double the size of the Bill and Melinda Gates Foundation, already the biggest vehicle for private charitable giving in the world, which was set up by the Microsoft founder Bill Gates to eradicate disease and poverty in the developing world and improve education in the West.
Mr Buffett's decision comes a fortnight after Mr Gates said he would step down from his day-to-day work at Microsoft to devote more time to the foundation.
Mr Buffett, 75, is known as the Sage of Omaha, for the folksy wisdom which has guided his investments over the past four decades. He has long indicated that 85 per cent of his wealth, tied up in shares in his Berkshire Hathaway conglomerate, will go to charity, but previously said it would be parcelled out after his death under the supervision of his wife, Susie. Her death, two years ago, has led him to change his plans.
He is taking his cue from Mr Gates, who says he plans to give away 95 per cent of his $50bn fortune before he dies. From next month, Mr Buffett will begin giving annual chunks of Berkshire Hathaway shares to the Gates Foundation and, to a lesser extent, to charities run by his three children. He will also continue giving some of his wealth to the Susan Thompson Buffett Foundation, his late wife's charity, which has focused on pro-abortion and nuclear disarmament campaigns.
Announcing his decision in the next issue of Fortune magazine, Mr Buffett says that it was never his intention to pass his wealth to his children. "They've had a gigantic headstart in a society that aspires to be a meritocracy. Dynastic mega-wealth would further tilt the playing field that we ought to be trying instead to level."
The Bill & Melinda Gates Foundation was set up in 2000 with $26bn from the Microsoft fortune, and has $30bn in assets, making it the biggest charitable trust in the world. Even if Berkshire Hathaway shares do not rise in value over the coming years, the promised donation by Mr Buffett would add a further $30bn.
The foundation is known for its work trying to eradicate malaria, tuberculosis and Aids in the developing world, on which it focuses 60 per cent of its grants. In the US, where it began as a project to hook libraries up to the internet, it is trying to improve secondary education by setting up or refurbishing hundreds of schools.
"We are awed by our friend Warren Buffett's decision to use his fortune to address the world's most challenging inequities, and we are humbled that he has chosen to direct a large portion of it to the Bill & Melinda Gates Foundation," the couple said.
Mr Buffett has known the couple for 15 years, and Mr Gates sits on the board of Berkshire Hathaway. "What can be more logical, in whatever you want done, than finding someone better equipped than you are to do it?" Mr Buffett asked. "Who wouldn't select Tiger Woods to take his place in a high-stakes golf game? That's how I feel about this decision about my money."
Mr Buffett will join the board of trustees at the Gates Foundation. He said the timing of his announcement was unrelated to this month's decision by Mr Gates, 50, to gradually increase the amount of time he spends at the charity. That decision marked the end of an era for Microsoft, a $225bn company, which Mr Gates founded in 1975 with his school friend Paul Allen.
Businessman with the Midas touch
The billionaire investor Warren Buffett, left, is known as the Sage or the Oracle of Omaha, after the Nebraska city whence he hails and still lives. Each year, more than 20,000 disciples (more accurately, shareholders in his holding company, Berkshire Hathaway) descend on downtown Omaha for Buffett's annual meeting. The "Woodstock of capitalism" is a showcase for companies Buffett has put money into, and a chance to quiz the man on the economic and business topics of the day. His annual letters to shareholders, with their homespun philosophies and jokey tone, have been collected into a book. The son of a stockbroker and congressman, Buffett was trading shares before he was 12, and had made his first land purchase, using cash saved from a paper round, by the age of 14. After a Masters at Colombia Business School, he began his own investment partnership in 1956, making returns more than three times above the market average.Reuse content