Now that he works full time at his namesake Foundation, Bill Gates has a lot more time to devote to its day to day operations and also for keeping us informed about what is going on inside his philanthropic empire. Earlier today, taking a queue from his friend Warren Buffet, Bill Gates released his first annual letter. In it he outlined his assessment of the progress made by the Foundation to date and outlined his vision for the coming years.
The letter was full of ambition, in particular with regards to global health goals:
“I believe that within six years we will have enough distribution to have cut the number of rotavirus deaths in half. This is an ambitious goal, but it’s one of the key steps to cutting the overall number of childhood deaths from 10 million to 5 million.”
But also acknowledged some of the criticisms that have been made of the Foundation’s focus on the science and technical aspects of technologies, rather than also some of the human and social factors that influence the adoption of such technologies:
“Some people criticize this approach, saying either that the problems can’t be solved with technology, or that the technology only works if it reaches the people who need it. There is some validity to both of these points….Technology is only useful if it helps people improve their lives, not as an end in itself.”
Bill acknowledged that the Foundation’s assets decreased in value by about 20% in 2008 (fair to say a pretty good outcome…considering). Historically, the Foundation has been spending about 5% of its assets annually, roughly the minimum required by law, presumably while the Foundation was earning returns far above 5% a year. This year, despite their set back, they have decided to increase the actual amount of money given by the Foundation – to roughly $3.8 billion – which actually translates into 7% of the value of its assets.
“..the goal of our foundation is to make investments whose payback to society is very high rather than to pay out the minimum to make the endowment last as long as possible.
I consider this to be a very noble gesture, consistent with his long term commitment. Gates is clearly Keynesian at heart (he even quotes him during his letter).
I enjoyed this opportunity to see how Bill Gates thinks and what drives him to devote so much of his time and resources to his Foundation. He talked about how he learned about important problems affecting poor people in the world, spent some time further researching this topic, and from his research he asked new questions and learned about how technology may help solve the problem. He is an engineer and a scientist at heart, and this background shows in his approach to important social issues.
I think it is also important for people to continue to think big – for example, he believes that we can once again halve the number (not just the proportion) of children who die before the age of 5 in the coming years. He seems fully committed to helping to develop the strategies needed to ensure this happens.
I also liked how he wants to bring in more partners to his causes. When thinking about what the Foundation could do for polio eradication efforts, they were happy to put forward money, but made is a condition that other donors also put forward millions of new funds as well.
Perhaps one of the most remarkable parts about this letter, is there were actually very few references to the actual achievements of the Foundation, other than to talk generally about the activities the Foundation has been involved with. I guess it hard to tout one’s own horn too loudly, but I think he could have done a bit more tooting.
I enjoyed this piece of introspection on Bill Gates part and am happy to learn that this will become a regular feature for the Foundation. The Foundation is clearly evolving: learning from its mistakes and thoroughly evaluating its achievements. I am just happy to know that we will be well informed of this evolution going forward.
If you want to read the letter yourself, click here.