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Bill And Melinda Gates Foundation

Bill & Melinda Gates Foundation
Type
Non-operating private foundation
(IRS exemption status): 501(c)(3)[1]
Founded 1997[2]
Founder(s)
Headquarters
Key people Bill Gates, co-founder and co-chair
Melinda Gates, co-founder and co-chair
William H. Gates, Sr., co-chair
Jeff Raikes, CEO
Area served Global
Focus(es) Education, Healthcare, Ending poverty
Method(s) Donations and Grants
Endowment US$36.2 billion as of 30 September 2012[3]
Employees 1,058[3]
Formerly called William H. Gates Foundation
(1994–1999)
Website www.gatesfoundation.org

Bill & Melinda Gates Foundation (B&MGF or the Gates Foundation) is the largest transparently operated[4] private foundation in the world, founded by Bill and Melinda Gates. It is "driven by the interests and passions of the Gates family."[5] The primary aims of the foundation are, globally, to enhance healthcare and reduce extreme poverty, and in America, to expand educational opportunities and access to information technology. The foundation, based in Seattle, Washington, is controlled by its three trustees: Bill Gates, Melinda Gates and Warren Buffett. Other principal officers include Co-Chair William H. Gates, Sr. and Chief Executive Officer Jeff Raikes.

It had an endowment of US$36.2 billion as of 30 September 2012.[3] The scale of the foundation and the way it seeks to apply business techniques to giving makes it one of the leaders in the philanthrocapitalism revolution in global philanthropy,[6] though the foundation itself notes that the philanthropic role has limitations.[5] In 2007, its founders were ranked as the second most generous philanthropists in America, and Warren Buffett the first.[7] A 2013 Bloomberg report stated that, as of May 16, 2013, Bill Gates had donated US$28 billion to the foundation.[8]

History

In 1994, the foundation was formed as the William H. Gates Foundation with an initial stock gift of US$94 million. In 1999, the foundation was renamed the Bill & Melinda Gates Foundation. After a merger with the Gates Learning Foundation in 2000, Gates gave an additional US$126 million.[2][9] During the foundation's following years, funding grew to US$2 billion. On June 15, 2006, Gates announced his plans to transition out of a day-to-day role with Microsoft, effective July 31, 2008,[10] to allow him to devote more time to working with the foundation.

Bill and Melinda Gates, along with the musician Bono, were named by Time as Persons of the Year 2005 for their charitable work. In the case of Bill and Melinda Gates, the work referenced was that of this foundation.

In April 2010, Gates was invited to visit and speak at the Massachusetts Institute of Technology where he asked the students to take on the hard problems of the world in their futures. He also explained the nature and philosophy of his philanthropic endeavors.[11][12]

In 2010, The Foundation's founders started The Commission on Education of Health Professionals for the 21st Century, entitled "Transforming education to strengthen health systems in an interdependent world."[13]

The Warren Buffett donation

On June 25, 2006, Warren Buffett (then the world's richest person, estimated worth of US$62 billion as of April 16, 2008) pledged to give the foundation approximately 10 million Berkshire Hathaway Class B shares spread over multiple years through annual contributions, with the first year's donation of 500,000 shares being worth approximately US$1.5 billion.[14] Buffett set conditions so that these contributions do not simply increase the foundation's endowment, but effectively work as a matching contribution, doubling the Foundation's annual giving: "Buffett's gift came with three conditions for the Gates foundation: Bill or Melinda Gates must be alive and active in its administration; it must continue to qualify as a charity; and each year it must give away an amount equal to the previous year's Berkshire gift, plus another 5 percent of net assets. Buffett gave the foundation two years to abide by the third requirement."[15] The Gates Foundation received 5% (500,000) of the shares in July 2006 and will receive 5% of the remaining earmarked shares in the July of each following year (475,000 in 2007, 451,250 in 2008).[16][17] In July 2013, Buffet announced another donation of his company's Class B, this time in the amount worth $2 billion, is going to the Bill and Melinda Gates Foundation.[18]

Activities

To maintain its status as a charitable foundation, it must donate at least 5% of its assets each year.[19] Thus the donations from the foundation each year would amount to over US$1.5 billion at a minimum.

The Foundation has been organized, as of April 2006, into four divisions, including core operations (public relations, finance and administration, human resources, etc.), under Chief Operating Officer Cheryl Scott, and three grant-making programs:

The Foundation will give hundreds of millions of dollars in the next few years to programs that promote saving by the world's poor, the Wall Street Journal reported,[20] presumably under a new grant-making program. According to tax documents posted on the Gates Foundation's website,[21] total grant expenditures in 2011 reached $4.4 billion, up from $2.2 billion in 2010. The Gates Foundation's audited 2011 tax return is 736 pages in length,[22] and lists its five highest-paid independent contractors, which include consulting firms McKinsey & Company[23] ($19.6 million), The Boston Consulting Group Inc.[24] ($18.1 million), and Accenture LLP[25] ($7.0 million), as well as architectural services firm NBBJ LP[26] ($11.4 million) and "teacher evaluation project" provider Teachscape Inc ($7.0 million). The Foundation also maintains an online database of grants made on its website.[27]

On December 18, 2008, the Clinton Foundation released a list of all contributors. It included the Bill & Melinda Gates Foundation, which gave between US$10–25 million.[28]

Global Health Program

The President of the Global Health Program is Trevor Mundel. The Gates Foundation has quickly become a major influence upon global health; the approximately US$800 million that the foundation gives every year for global health approaches the annual budget of the United Nations World Health Organization (193 nations), and is comparable to the funds given to fight infectious disease by the United States Agency for International Development.[29]

The Global Health Program's significant grants include:

The Global Fund to Fight AIDS, Tuberculosis and Malaria
Over $1.3 billion donated as of 2012.
Polio eradication
The Foundation provides 17% (US$86 million in 2006) of the world budget for the attempted eradication of poliomyelitis (polio).[30]
The GAVI Alliance
The foundation gave the GAVI Alliance (formerly the “Global Alliance for Vaccines and Immunisation”) a donation of US$750 million on January 25, 2005.[31][32]
Children's Vaccine Program
The Children's Vaccine Program, run by the Program for Appropriate Technology in Health (PATH), received a donation of US$27 million to help vaccinate against Japanese encephalitis on December 9, 2003.[33]
University of Washington Department of Global Health
The foundation provided approximately US$30 million for the foundation of the new Department of Global Health at the University of Washington in Seattle. The donation promoted three of the Foundation's target areas: education, Pacific Northwest and global health. The foundation also lead a study to increase access to high education globally.
HIV Research
The foundation has donated a grand total of US$287 million to various HIV/AIDS researchers. The money was split between sixteen different research teams across the world, on the condition that they share their findings with one another.[34]
Aeras Global TB Vaccine Foundation
The foundation gave the Aeras Global TB Vaccine Foundation more than US$280 million to develop and license an improved vaccine against tuberculosis for use in high burden countries.[35][36]
Cheaper high-tech TB test
In August 2012, the foundation, in partnership with PEPFAR (United States President’s Emergency Plan for AIDS Relief), USAID (United States Agency for International Development), and UNITAID (an international drug purchasing facility hosted by WHO), announced they had finalized an agreement to reduce the cost of a commercial TB test (Cepheid’s Xpert MTB/RIF run on the GeneXpert platform) from $16.86 to $9.98. This test can take the place of smear microscopy, a technique first developed in the 1880s by Robert Koch. Smear microscopy often does not show TB infection in persons who are also co-infected with HIV, whereas Xpert MTB/RIF can show TB in the co-infected patient. In addition, the GeneXpert system can show whether the particular TB strain is resistant to the antibiotic rifampicin, which is a widely accepted indicator of the presence of multi-drug resistant tuberculosis.[37][38]
Visceral Leishmaniasis Research
The foundation awarded the Hebrew University of Jerusalem Kuvin Center for the Study of Infectious and Tropical Diseases a US$5 million grant in 2009 for research into visceral leishmaniasis, an emerging parasitic disease in Ethiopia where it is frequently associated with HIV/AIDS, and a leading cause of adult illness and death. The project is a collaborative effort with Addis Ababa University and will gather data for analysis to identify the weak links in the transmission cycle and devise methods for control of the disease.[39]
The foundation has also given The Institute for OneWorld Health a donation of nearly US$10 million to support the organization's work on a drug for visceral leishmaniasis.
Next Generation Condom
The foundation is offering $100,000 to the scientist who can develop a new and improved condom,Grand Challenges Explorations, a program that rewards innovative, unorthodox approaches to global health and disease prevention.
Neglected tropical diseases
The foundation took the initiative of the WHO-inspired project called London Declaration on Neglected Tropical Diseases launched on 30 January 2012 in London, and had allocated a 5-year US $363 million commitment, the largest funding for the project. The programme is to eradicate or control 10 major tropical diseases by 2020.[41][42]

Global Development Program

President Chris Elias leads the Global Development Program, which combats extreme poverty through grants including:

Financial Services for the Poor

Alliance for Financial Inclusion (AFI)
A US$35 million grant for the Alliance for Financial Inclusion to support a coalition of countries from the developing world making savings accounts, insurance, and other financial services available to people living on less than $2 a day.
Financial Access Initiative
A US$5 million grant allows Financial Access Initiative to do field research and answer important questions about micro finance and financial access in impoverished countries around the world.
Pro Mujer
A US$3.1 million grant to Pro Mujer, a leading microfinance network in Latin America, and a pioneer at combining financial services with healthcare for the poorest women entrepreneurs. The five-year grant will be used to research new opportunities for serving the very poorest segment of the Latin American microfinance market.
Grameen Foundation
A US$1.5 million grant allows Grameen Foundation to make more microloans, to support Grameen's goal of helping five million additional families and successfully freeing 50 percent of those families from poverty within five years.[43]

Agricultural Development

Rice Research
Between November 2007 and October 2010, the Gates Foundation will offer US$19.9 million to the International Rice Research Institute. The aid is intended to support the increasing demand the world has placed on rice. The Bill and Melinda Gates Foundation claims “To keep up with worldwide demand, the production of rice will have to increase by about 70 percent in the next two decades.”[44] Yielding higher grade crops will ensure local farmers get the best return out of their crop annually and be able to offer greater quantities.

The IRRI maintains that with the improvement of rice yields, not only will people reap the benefits of a more nutritious crop, advances in crop research will help sustain local economies. Rice that cost less to produce and yield greater amount makes the final product less expensive for consumers.[45]

Alliance for a Green Revolution in Africa (AGRA)
The Gates Foundation has partnered with the Rockefeller Foundation to enhance agricultural science and small-farm productivity in Africa, building on the Green Revolution that the Rockefeller Foundation spurred in the 1940s and 1960s. The Gates Foundation has made an initial US$100 million investment in this effort, to which the Rockefeller Foundation has contributed US$50 million. Critics allege that the Foundation has a preference to make grants that benefit multinational agribusiness, such as Monsanto,[46] which do not take into account many local needs in Africa.[47]

Global Special Initiatives

The Foundation's Special Initiatives include responses to catastrophes as well as learning grants, which are used to experiment with new areas of giving. Currently, the Foundation is exploring water, hygiene and sanitation as a new focus within Global Development.

Indian Ocean Earthquake
The foundation made total grant donations of US$3 million to various charities to help with the aid effort for victims of the 2004 Indian Ocean earthquake. These charities include:
Kashmir Earthquake
The foundation made a donation of US$500,000 for the 2005 Kashmir earthquake.[48]
Water, Hygiene and Sanitation
Improved sanitation in the developing world is a global need, but a neglected priority. The Millennium Development Goals (MDGs) include a sanitation target to reach 75% coverage of improved sanitation by 2015, but it remains one of the MDG goals most far out of reach. Currently, 2.5 billion people do not have access to improved sanitation and nearly 1.1 billion resort to open defecation (MDG Report, 2012).[49] Even in urban areas, more than 2 billion people in the developing world lack access to services and infrastructure for the safe disposal of human waste (The World Bank, 2003). Open defecation poses significant health and environmental risks. Open defecation also creates vulnerability, particularly for women and children who are exposed to a loss of dignity, abuse or harassment while defecating in the open. Globally, poor sanitation contributes to 1.5m child deaths each year from diarrheal disease; in India alone, diarrhea kills 1 child per minute (UNICEF/WHO, 2009). Diarrhea is also a major cause of death for children and chronic diarrhea hurts child development by impeding their health, nutrition and hinders vaccine absorption. Those who suffer from the lack of this most basic of human needs also tend to be victims of poverty, ill health, and an overall poor quality of life.
Reinvent the Toilet Challenge
In 2011 The foundation launched a program to promote the development of toilet innovations to benefit the 2.5 billion people that do not have access to safe and effective sanitation.[51] The Reinvent the toilet challenge (RTTC) is premised on the fact that ground-breaking improvements are required in toilet design and fecal sludge management to close the urban sanitation gap. Since its launch, 15 teams have received grants to develop innovative on-site and off-site waste treatment solutions for the urban poor. The RTTC is focused on reinventing the flush toilet, a break-through public health invention that has not changed substantially since the first flush toilet patent was issued in 1775. The Foundation has called on grantees to design a standalone toilet unit without piped-in water, a sewer connection, or outside electricity, with facility costs targeted at less than five cents per person per day. RTTC is also working to improve waste handling from collection and treatment.

United States Program

Under President Allan Golston, the United States Program has made grants such as the following:

U.S. Libraries

In 1997, the charity introduced a U.S. Libraries initiative with a goal of "ensuring that if you can get to a public library, you can reach the Internet." The foundation has given grants, installed computers and software, and provided training and technical support in partnership with public libraries nationwide.

Most recently, the foundation gave a US$12.2 million grant to the Southeastern Library Network (SOLINET) to assist libraries in Louisiana and Mississippi on the Gulf Coast, many of which were damaged or destroyed by Hurricanes Katrina and Rita.

Education

Smaller Schools
The Gates foundation claims one in five students is unable to read and grasp the contents of what they read, and African American and Latino students are graduating high school with the skills of a middle school student.[52] The Bill and Melinda Gates foundation has invested more than US$250 million in grants to create new small schools, reduce student-to-teacher ratios, and to divide up large high schools through the schools-within-a-school model.[52]
Cornell University
Faculty of Computing and Information Science received US$25 million from the Foundation for a new Information Science building, which will be named the Bill and Melinda Gates Hall. The total cost of the building is expected to be US$60 million. Construction began in March 2012 and is expected to be completed by the end of 2013.[53]
Carnegie Mellon University
The Foundation gave US$20 million to the Carnegie Mellon School of Computer Science for a new Computer Science building called the Gates Center for Computer Science.[54] It officially opened on September 22, 2009.[55]
Massachusetts Institute of Technology
Part of the Ray and Maria Stata Center is known as the Gates Tower in recognition of partial funding of the building.
D.C. Achievers Scholarships
The Bill and Melinda Gates Foundation announced March 22, 2007 a US$122 million initiative to send hundreds of the District of Columbia's poorest students to college.[56]
Gates Cambridge Scholarships
Donated US$210 million in October 2000 to help outstanding graduate students outside of the United Kingdom study at the University of Cambridge. Approximately 100 new students every year are funded.[57]
Gates Millennium Scholars
Administered by the United Negro College Fund, the foundation donated US$1.5 billion for scholarships to high achieving minority students.[58]
NewSchools Venture Fund
The Foundation contributed US$30 million to help NewSchools to manage more charter schools, which aim to prepare students in historically underserved areas for college and careers.
Strong American Schools
On April 25, 2007, the Bill and Melinda Gates Foundation joined forces with the Eli and Edythe Broad Foundation pledging a joint US$60 million to create Strong American Schools, a nonprofit project responsible for running ED in 08, an initiative and information campaign aimed at encouraging 2008 presidential contenders to include education in their campaign policies.[59]
Teaching Channel
The Bill and Melinda Gates Foundation announced in September 2011 a US$3.5 million initiative to launch a multi-platform service delivering professional development videos for teachers over the Internet, public television, cable and other digital outlets.[60] To date, over 13,500 teachers and educators have joined the community to share ideas, lesson plans and teaching methods.[61]
The Texas High School Project

The project was set out to increase and improve high school graduation rates across Texas. The foundation committed US$84.6 million to the project beginning in 2003. The THSP focuses its efforts on high-need schools and districts statewide, with an emphasis on urban areas and the Texas-Mexico border.[62]

University Scholars Program
Donated US$20 million in 1998 to endow a scholarship program at Melinda Gates' alma mater, Duke University.[63] The program provides full scholarships to about 10 members of each undergraduate class and one member in each class in each of the professional schools (schools of medicine, business, law, divinity, environment, nursing, and public policy), as well as to students in the Graduate School pursuing doctoral degrees in any discipline. Graduate and professional school scholars serve as mentors to the undergraduate scholars, who are chosen on the basis of financial need and potential for interdisciplinary academic interests. Scholars are chosen each spring from new applicants to Duke University's undergraduate, graduate, and professional school programs. The program features seminars to bring these scholars together for interdisciplinary discussions and an annual spring symposium organized by the scholars.
Washington State Achievers Scholarship
The Washington State Achievers program encourages schools to create cultures of high academic achievement while providing scholarship support to select college-bound students.
William H. Gates Public Service Law Program
This program awards five full scholarships annually to the University of Washington School of Law. Scholars commit to working in relatively low-paying public service legal positions for at least the first five years following graduation.[64]
University of Texas at Austin
$30 million challenge grant to build the Bill & Melinda Gates Computer Science Complex [65]

Bill Gates also contributed funds to build other computer science facilities:

Pacific Northwest

Discovery Institute
Donated US$1 million in 2000 to the Discovery Institute and pledged US$9.35 million over 10 years in 2003, including US$50,000 of Bruce Chapman's US$141,000 annual salary. According to a Gates Foundation grant maker, this grant is "exclusive to the Cascadia project" on regional transportation, and it may not be used for the Institute's other activities, including promotion of intelligent design.
Rainier Scholars
Donated US$1 million
Computer History Museum
Donated US$15 million to the museum in October 2005.[67]

Lifespan

In October 2006 the Bill & Melinda Gates Foundation was split into two entities: the Bill & Melinda Gates Foundation Trust, which manages the endowment assets and the Bill & Melinda Gates Foundation, which "... conducts all operations and grantmaking work, and it is the entity from which all grants are made."[68][69] Also announced was the decision to "... spend all of [the Trust's] resources within 20[70] years after Bill's and Melinda's deaths."[71][72][73][74] This would close the Bill & Melinda Gates Foundation Trust and effectively end the Bill & Melinda Gates Foundation. In the same announcement it was reiterated that Warren Buffett "... has stipulated that the proceeds from the Berkshire Hathaway shares he still owns at death are to be used for philanthropic purposes within 10 years after his estate has been settled."[71]

The plan to close the Foundation Trust is in contrast to most large charitable foundations that have no set closure date. This is intended to lower administrative costs over the years of the Foundation Trust's life and ensure that the Foundation Trust not fall into a situation where the vast majority of its expenditures are on administrative costs, including salaries, with only token amounts contributed to charitable causes.[72]

Criticism

Investments

The foundation invests the assets that it has not yet distributed, with the exclusive goal of maximizing the return on investment. As a result, its investments include companies that have been criticized for worsening poverty in the same developing countries where the Foundation is attempting to relieve poverty.[75] These include companies that pollute heavily and pharmaceutical companies that do not sell into the developing world.[76] In response to press criticism, the foundation announced in 2007 a review of its investments to assess social responsibility.[77] It subsequently cancelled the review and stood by its policy of investing for maximum return, while using voting rights to influence company practices.[78]

Diversion of health care resources

The Foundation has donated millions of dollars to help sufferers of AIDS, tuberculosis and malaria. However, investigations in 2007 from Foreign Affairs[79] and Los Angeles Times[80] claimed there were three major problems with the foundation's allocation of aid. First, "by pouring most contributions into the fight against such high-profile killers as AIDS, Gates guarantees have increased the demand for specially trained, higher-paid clinicians, diverting staff from basic care." This form of "brain drain", pulls away trained staff from children and those suffering from other common killers. Second, "the focus on a few diseases has shortchanged basic needs such as nutrition and transportation…."[80] Finally, "Gates-funded vaccination programs have instructed caregivers to ignore – even discourage patients from discussing – ailments that the vaccinations cannot prevent."[80]

Earlier that year in a article, Laurie Garrett claimed that many charitable organizations, among whom the Gates Foundation is prominent, harm global health by diverting resources from other important local health care services. For example, by paying relatively high salaries at AIDS clinics, the foundation diverts medical professionals from other parts of developing nations' health care systems; the health care systems' ability to provide care diminishes (except in the area the foundation funds) and the charities may do more harm than good.

Education reform

The public school reform program of the Gates Foundation has come under criticism by education professionals, parents, and researchers for promoting reforms that they see as undermining public education. The reforms include closing neighborhood schools in favor of privately run charter schools; using standardized test scores extensively to evaluate students, teachers, and schools; and merit pay for teachers based on test scores. Critics also believe that the Gates Foundation exerts too much influence over public education policy without being accountable to voters or tax payers. [81][82][83]

Grantee communication

The Gates Foundation has been roundly criticized for failing to communicate efficiently and effectively with its grantees, dating back to a 2008 survey report that was not released to the public[84] as well as a 2010 "Grantee Perception Report",[85] which painted a similarly bleak picture of grantee attitudes beliefs, and knowledge about its grantmaking activities among grantees. The Gates Foundation's September 2012 Grantee Progress Report echoes similar themes of inadequate and ineffective communication with grantees, including significant effort duplication.[86] To address these criticisms and improve communication with its grantees, the Gates Foundation launched a podcast series,[87] an e-mail newsletter to grantees, and has funded the Center for Effective Philanthropy[88] to support improved grantee perception and communication.

Awards

See also

Notes and references

External links

  • The Foundation Center: Top 100 US Foundations by asset size Gates Foundation ranked number one.
  • New York Times Updated news on the Foundation.
  • Seattle Post-Intelligencer article.
  • Bono.
  • LA Times investigative article by Charles Piller, Edmund Sanders and Robyn Dixon.
  • Bill Gates, "Keynote Address to the Creating Digital Dividends Conference" October 2000 Voices of Democracy Project- philanthropic role and involvement
  • Building a Toilet Fair - Day 1 | Impatient Optimists (August 14, 2012)

Template:Bill Gates

Coordinates: 47°37′25″N 122°20′44″W / 47.62361°N 122.34556°W / 47.62361; -122.34556

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