Warren Buffett, the 95-year-old Berkshire Hathaway chairman, dropped the Gates Foundation from his annual charitable donations on Tuesday for the first time since 2006, redirecting billions of dollars in Berkshire stock to four foundations run by his family and calling Bill Gates' association with the late sex offender Jeffrey Epstein "distasteful."
The move ends a $47 billion, 20-year philanthropic relationship that made the Gates Foundation the single largest beneficiary of Buffett's fortune. Buffett also said he intends to dispose of his remaining Berkshire shares within about eight years, by Dec. 31, 2034, shifting responsibility for giving away one of the world's largest personal fortunes to his three children.
The new allocation
This year's gifts total about $6 billion at current prices. The Susan Thompson Buffett Foundation, named for Buffett's late first wife, will receive 9 million Class B shares worth about $4.5 billion. Three foundations run by Buffett's children — the Sherwood Foundation, the Howard G. Buffett Foundation and the NoVo Foundation — will each receive 1 million Class B shares valued at just under $500 million.
Why the shift
Buffett did not name Gates or Epstein in his written statement. But he told CNBC's Becky Quick that he had "read a great deal since January 1 in terms of what happened, with Bill and Epstein." The Justice Department released files documenting Gates' contacts with Epstein in January. In June, Gates testified before the House Oversight Committee that Epstein was introduced to him in 2011 as someone who could raise billions of dollars for global health. "I should never have met with Epstein in the first place," Gates told the committee.
The foundation's reply
The Gates Foundation said in a statement to the BBC that it was "grateful to Warren Buffett for his decades of support for our work" and that it "continues from a position of financial strength to advance our work through 2045, supported by Bill's $200bn commitment."
Not a break
Buffett stopped short of publicly ending the friendship. He told CNBC that Gates had visited him in Omaha about three weeks ago for a three-hour conversation and had proposed another meeting. "While it's distasteful, while he made mistakes, I made mistakes, hiring all kinds of people, or choosing friends, and then finding out later that, one way or other, they weren't what I thought they were," Buffett said. No dissenting business-press account of Buffett's rationale had emerged by press time.
Buffett's 2006 pledge had promised donations to the Gates Foundation "throughout my lifetime." His new schedule sets Dec. 31, 2034 as a hard end point — 11 years before the foundation itself now plans to wind down operations.