THE WORLD of philanthropy has been set alight by the decision of 40 American billionaires to pledge at least half their fortunes to charity. The pledges were made following a series of billionaire dinners hosted by Bill and Melinda Gates and Warren Buffett since May 2009. The initiative takes giving to a new level in the US and comes at a time of huge challenges.
Philanthropy has always played an important role in American life. Universities, hospitals and non-profit organisations there rely heavily on private donations. During the boom years a similar culture of philanthropy began to develop here, in parallel with the growth of a more open and market-oriented economy, and many institutions and social programmes have come to depend on private donations. But the process was stalled by the financial downturn.
There remains untapped potential for philanthropic growth in this country, according to a recent McKinsey Company report. It found that the spread of philanthropic giving by private individuals and corporations in Ireland is narrow and the amounts are still small. Private donations account for 0.8 per cent of disposable income compared to 2.0 per cent in the US.
Ireland has adopted many positive US business practices but not in this regard. Part of the reason is a lack of understanding of the complementary role that philanthropic activities can have with the public sector. As McKinsey points out, social affairs are ultimately regarded as a government responsibility and hence only a few high-profile Irish philanthropists are willing to stand up to public scrutiny and serve as role models for their peers. The actions of Bill and Melinda Gates and Warren Buffett have challenged not just their fellow Americans but rich people everywhere to give much more while alive.
One name was conspicuous by its absence from their list of pledged givers. Chuck Feeney, whose Atlantic Philanthropies has given over $1 billion to the island of Ireland, was one of the first people Gates consulted, but as the former duty-free owner gave away virtually all of his wealth to his foundation more than 25 years ago, it made little sense for him now to sign any pledge. Feeney effectively jump-started this latest trend in philanthropy with his philosophy of giving while living.
Despite the downturn there are still many wealthy people in Ireland, some of whom participate actively in good causes. The impoverishment of our society due to dwindling government funds makes their involvement in thoughtful philanthropy all the more important.