Andrew Carnegie once “warned successful men who failed to help others that ‘the man who dies thus rich dies disgraced.’” In the billionaire-turned-philanthropist’s seminal text The Gospel of Wealth, Carnegie presses the importance of donating one’s fortune to charitable endeavors, essentially founding the modern “spending-down” phenomenon. This “duty of the man of Wealth” helps foster a virtuous civil society, as established upon the harmony of community.
As regular readers of Philanthropy Daily are aware, “The Giving Pledge,” founded by billionaires Warren Buffett and Bill Gates, seeks to be a contemporary manifestation of Carnegie’s vision. The pledge, featuring signatories from twelve countries, is a “moral commitment” from billionaires to spend at least half of their fortunes during their lifetimes. The pledge features many familiar names – Bloomberg, Case, Ellison, Sandberg, Huntsman, Musk, and Zuckerberg all appear on the pledge’s list. It is important to note, the pledge protects the billionaire’s autonomy, making it clear that “each person who pledges makes an individual decision about which particular causes or organizations they wish to support.”
In a fascinating report from a trio of University of Southampton scholars, titled “Why Give Away Your Wealth?: An Analysis of the Billionaires’ View,” Janan Sadeh, Mirco Tonin, and Michael Vlassopoulos provide a comprehensive analysis comparing the billionaires who signed the pledge against non-signers. The discussion paper marries traditional quantitative methodology (largely from econometrics) with trait study analyses (from psychology, sociology, and leadership studies).
In an associated blog post at the Brookings Institution, Tonin and Vlassopoulos note that from 2011 to 2013 billionaires donated $69 billion to charity. From this premise, viz. that the philanthropic sector is intimately related to these billionaires’ spending behavior, their report is substantively significant.
Their paper essentially asks two questions: 1) “Who becomes a Pledger?” and 2) “What motivates the Pledgers?” Looking at the first question, they found that 76 of the 472 billionaires on their list signed the pledge. After conducting a regression analysis, they find that self-made billionaires are much more likely to join the pledge when compared to those who had inherited their wealth. Additionally, they find an “indication that the richer among billionaires are also more likely to join.” In terms of the other variables in their model (age, sex), the findings were tenuous at best.
Turning to their second question, the researchers conduct a content-based textual analysis of the letters that the billionaires share upon signing the Giving Pledge (these letters can be thought of as press releases). After introducing ten categories (e.g. “legacy, “no need,” “values,” etc.), the results show “impact” had the greatest influence within their letters. In other words, according to their letters, the billionaires predictably donate the money in order to achieve some sort of philanthropic end. While “values” comes in second place, its share of the total mentions is less than one-third of “impact.”
Following, the report attempts to build a model using both of these data sets, and finds that
self made individuals write more . . . about the desire not to leave an inheritance and about the role of luck as motivations. They also write more about the desire to provide an example.
Although there are some valid methodological critiques of this discussion paper – viz., perhaps Giving Pledge letters simply measure perception rather than motivation and perhaps the first model misses Giving Pledge-saliency by industry/celebrity status/prior philanthropic behavior/etc. – the paper is nonetheless a notable research project. For those in development, the paper identifies how perceived motivations influence giving. For those in public relations, it provides a subtle commentary on the interplay between giving and sharing. For those who are billionaires, well, it provides an interesting look at their peers.
Though the report provides an interesting snapshot of today’s pledgers, there are significant questions about what these findings tell us about the future of billionaire philanthropy. To close, as the authors of the report conclude:
Whether [the Giving Pledge] will be successful in persuading more and more of the extremely rich to follow this path remains an open question.