Andrew Bary

Bill Gates' commitment to give away $200 billion over the next 20 years unveiled Thursday highlights the challenge that Warren Buffett's three children will face after his death.

Buffett, the 94-year-old CEO of Berkshire Hathaway, has charged them with giving away his fortune -- that consists almost entirely of some $160 billion of Berkshire stock -- in a decade or so after his death.

Gates, 69, is planning to give away an average of about $10 billion annually over the next 20 years. He has a large organization, the Gates Foundation, with over 2,000 employees to do it.

The three Buffett children, Susan, Peter and Howard, might collectively need to donate at least $15 billion annually to liquidate the Buffett fortune in anything close to a decade.

They each have philanthropic experience, but with much smaller sums, having received annual donations from their father since 2006. The three each have been giving away $200 million to $300 million annually with staffs of 20 to 30 people.

Warren Buffett hates bureaucracies and has stated that he wants his kids to maintain "lean" organizations. Buffett runs Berkshire with a headquarters staff in Omaha totaling about 20 and the company has no investor relations, public relations or general counsel departments.

It will be a big undertaking to give away Buffett's $160 billion over anything close to a decade, especially if the stock continues to appreciate. Buffett, like Gates, wants his foundation to have a finite life.

Buffett now makes the bulk of his charitable contributions to the Gates Foundation, and his annual gift in June should total about $5 billion based on his giving formula. Buffett has said that gifts to the Gates Foundation will cease on his death.

The Buffett kids are aged 67 to 71. Buffett wrote in a letter to Berkshire holders last year that "the massive wealth I've collected may take longer to deploy than my children live." As a result, three potential, unnamed successor trustees have been designated for each of them.

Susan, 71, now oversees the Sherwood Foundation, which concentrates its donations in Nebraska, where she and her father live.

Howard Buffett, 70, runs the Howard G. Buffett foundation, which has focused its efforts on Ukraine in recent years and become one of the largest private benefactors of the embattled nation. He has been cited personally by Ukraine President Volodymyr Zelensky.

Peter Buffett, 67, oversees the Novo Foundation and has been active in giving in the Kingston, N.Y., area north of New York City. Susan and Howard Buffett are Berkshire board members.

Buffett is complicating the future philanthropic actions of his kids by requiring that their giving decisions after his death be made by unanimous consent.

"Wealthy friends have been curious about the extraordinary confidence I have in my children and their possible alternates. They express particular surprise at my requirement that all foundation actions will require a unanimous vote. How can this be workable?" Buffett wrote last year.

"I've explained that my children will forever be besieged with earnest requests from very sincere friends and others. A second reality: When large philanthropic gifts are requested, a "no" frequently prompts would-be grantees to ponder a different approach -- another friend, a different project, whatever. Those who can distribute huge sums are forever regarded as "targets of opportunity." This unpleasant reality comes with the territory."

A big job awaits the three Buffett children and it may extend past their lifetimes. The future Buffett Foundation could be around for 20 years after Warren Buffett's death.

Write to Andrew Bary at andrew.bary@barrons.com

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May 09, 2025 00:01 ET (04:01 GMT)

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