Warren Buffet is distributing an additional $1 billion of his fortune to his family’s foundations and designated three potential successor trustees. The 94-year-old CEO and chairman of Berkshire Hathaway announced in a letter Monday he plans to convert 1,600 company A shares into 2.4 million B shares, worth about $1.14 billion. He’ll then distribute 1.5 million of the shares to the Susan Thompson Buffett Foundation, named for his late wife, and 300,000 to each of his three children’s foundations.Buffett—worth $150 billion, according to the Bloomberg Billionaire Index—has been in the process of offloading his wealth since 2006 as part of his pledge to transfer 99% of his estate to philanthropic causes before his death. As of Monday’s announcement, Buffett has given away 56.6% of his fortune.Transferring stock to his family’s philanthropic pursuits has become a tradition for the billionaire investor. Ahead of Thanksgiving last year, Buffett donated $870 million to his children’s charities.Pouring resources into his children’s causes is a practice Buffett took from his wife Susan who died in 2004. She gave her three children their first gifts, about $10 million each, and left 96% of her $3 billion estate to her foundation. Following his death, Buffett will cease donating to most other philanthropic organizations, including the Bill and Melinda Gates Foundation, to which he’s previously donated $39 billion. Buffett said his continued donations to his children’s causes is a testament to his trust in them. “The children have now more than justified our hopes and, upon my death, will have full responsibility for gradually distributing all of my Berkshire holdings,” he said in the letter. “These now account for 99½% of my wealth.”Buffett also addressed the future of his reserves beyond his kids, believing “the massive wealth I’ve collected may take longer to deploy than my children live.” His children are 71, 69, and 66.He appointed three potential successor trustees to guide the family’s impact in the future in case his kids can’t serve. The “somewhat younger” successors were not named in the letter, but are well-known by and were agreed upon by Buffett’s children.But his children’s maturation and ability to take on their father’s wealth has become inextricable from Buffett’s own mortality, something he’s keenly aware of.“Father time always wins,” he said. “To date, I’ve been very lucky, but, before long, he will get around to me.”Complications of wealthBuffett, who became CEO and chairman of Berkshire Hathaway in 1970, helped the conglomerate reach a $1 trillion valuation ahead of his 94th birthday, but his insistence on giving away his wealth cost him the chance of becoming world’s richest man. It’s representative of his complicated relationship with his fortunes.Buffett also said in the letter that while his family’s philanthropic efforts been a way to help those “less lucky,” they also require a means to protect resources for future endeavors.With Buffett’s donations to his children comes the stipulation they must unanimously agree on all foundation actions. That’s in part because their fortune inevitably makes them “targets of opportunity” from friends and grant-makers, well-intentioned or not. By making his kids stand arm-in-arm on decisions regarding his wealth, Buffett ensures opportunists won’t be able to exploit the family resources.“That restriction enables an immediate and final reply to grant-seekers: ‘It’s not something that would ever receive my brother’s consent,’” Buffett said. “And that answer will improve the lives of my children.”The Buffett family’s four charities include the Susan Thompson Buffett foundation supporting reproductive health care organizations, including those that provide abortion and contraception access; the Sherwood Foundation run by daughter Susie Buffett providing early childhood education opportunities in the U.S., as well as housing development in Buffett’s hometown of Omaha; the Howard G. Buffett foundation distributing funds to international agriculture and U.S. law enforcement; and the NoVo foundation run by Peter Buffett, which offers support for ending sexual exploitation and child marriage.“I have now watched my children grow into good and productive citizens,” Buffett said. “They have different views in many cases from both me and their siblings but have common values that are unwavering.”How many degrees of separation are you from the globe's most powerful business leaders? Explore who made our brand-new list of the 100 Most Powerful People in Business. Plus, learn about the metrics we used to make it.
