Billionaire philanthropists John and Laura Arnold have committed to donating a minimum of 5% of their wealth annually to charity by signing on to the Global Citizen’s “Give While You Live” campaign.
While the pledge might not significantly change the course of their charitable giving—they donated more than 8%, or $285 million, of their wealth last year, ranking the eighth largest donors in 2020, according to Chronicle of Philanthropy—their commitment is meant to inspire the world’s billionaires to give away money faster during their lifetime.
“There is a gap between philanthropic intent and philanthropic action,” Arnold, 47, a former hedge fund manager, tells Penta. “I do hope to inspire others to accelerate their charitable giving.”
The Houston -based couple, co-founders of Arnold Ventures LLC, are estimated to be worth $3.3 billion. So far, they have donated $1.24 billion to causes including criminal justice, healthcare, education, and government policy, according to Forbes.https://tpc.googlesyndication.com/safeframe/1-0-38/html/container.html
They were the original signatories of The Giving Pledge, an initiative launched in 2008 by Bill and Melinda Gates and Warren Buffett to motivate the world’s richest to give away more than half of their wealth during their lifetime or in their wills.
Even for those signatories, it’s very easy to put off giving, Arnold says. “I encourage people to have a specific plan and work in reverse: When do you want to give away your money, and what actions you need to take today?”
John and Laura Arnold are the first billionaires to sign on the “Give While You Live” campaign, launched in January 2020 during the Davos World Economic Forum. The campaign calls on the world’s 2,000-plus billionaires to donate 5% of their wealth every year to an important cause.https://8fe45cbcd5cd429b1319129622d7d21b.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
Global Citizen, founded in 2012, has a mission to end the extreme poverty around the world by 2030. Last year, the organization hosted the campaigns “One World: Together at Home” and “Global Goal: Unite for Our Future,” which mobilized more than $1.5 billion in cash grants.
The Arnolds ' pledge Monday came as part of an alliance between Global Citizen and the Arnold-led Initiative to Accelerate Charitable Giving, a coalition of donors and experts who are pushing for charitable giving reforms, including asking the Congress to raise giving requirements for donor-advised funds, an investment and giving vehicle that allows an individual to enjoy an immediate tax benefit and distribute charitable gifts over time.
“Right now, many charities are in danger of not surviving the pandemic. Yet, more than $1 trillion promised to them remains warehoused in tax-free investment accounts,” Arnold says.
Under current U.S. tax law, private foundations must donate 5% of their endowments annually to maintain their tax-exempt status.https://8fe45cbcd5cd429b1319129622d7d21b.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
By devising a specific plan to “Give While You Live,” Arnold says it’s also beneficial to the philanthropists’ family dynamics.
“I have seen often that people wait until toward the end of their lives, and there are no other options than letting their kids do it,” he says. “However, the second generations are not passionate about the same things and feel it a burden to manage their parents’ philanthropy estate.”
Arnold says his philanthropic role model is Chuck Feeney, co-founder of airport retailer Duty Free Shoppers. He has quietly given away more than $8 billion through his foundation, the Atlantic Philanthropies, while living off about $2 million he set aside for his and his wife’s retirement.
“That is an aspiration for Laura and me,” Arnold says. “I think it is important to spread this model.”