Swiss Giving Pledge!? Societal engagement from an entrepreneurial standpoint: the case of Switzerland
I. The origins of the Giving Pledge
It all began in 2009 when David ROCKEFELLER hosted a dinner. The guests included Warren BUFFET and Bill and Melinda GATES. The topic of the evening was philanthropy. The exchange seemed to be extremely stimulating and very interesting for everyone involved, the participants having the opportunity to present their philanthropic commitments to each other, as it were
It therefore came as no surprise that the discussion was continued over two further dinners. During these three meetings, the idea for the Giving Pledge was eventually born. The principle of the Giving Pledge is that every member pledges1 to use the greater part of their wealth for the common good during their lifetime, or at the latest upon their death. To date, over 100 of the around 400 American billionaires have subscribed to the Giving Pledge. The concept originated from Warren BUFFET, who had earlier committed to donate 99% of his wealth – which at the time of writing was already 44 billion dollars – to the Bill & Melinda Gates Foundation.
It is the philosophy behind the Giving Pledge that I find remarkable, and is the reason why I am telling you this story.
II. The philosophy of the Giving Pledge
The Giving Pledge seeks to bring together a group of philanthropists – or those who want to become philanthropists – so that they can learn from each other. The aim is to exchange ideas and provide mutual inspiration. And – to increase the social impact of philanthropy – their good works should be publically disclosed. Potential donors will thereby be encouraged to do the same. They should also be motivated to want to belong to this group of philanthropists, particularly in the “here and now”. After all – according to the founders' convictions – everyone has to grapple with socio-political issues and be prepared to make a contribution (not only with their money, but also with their knowledge, time, talent and network).
I can wholeheartedly subscribe to these thoughts and convictions. And I would even go one step further. Not only should we ask ourselves whether such a group could be formed in Switzerland, but - right from the outset - we should also try to address those issues which are insufficiently (or not at all) addressed by the state and the private sector, even though these issues are of huge importance to society. And that is also exactly what the Müller-Möhl Foundation wants to do. Despite my initial reluctance to add yet another foundation to the 12,715 charitable foundations already in existence in Switzerland, I have decided in the last year to set up my “own” foundation, the Müller-Möhl Foundation. It aims to provide a platform for lively, dedicated and liberal citizenship, and will for the time being focus on three issues which, from our point of view, aren´t getting enough attention by the state and the private sector. These issues include education, where we are particularly involved in early childhood education and the financial literacy of young people; a second sphere of activity is the promotion of gender diversity, which for us means that men and women together share the responsibility for a productive, efficient, independent and happy society; thirdly, we are focusing on promoting philanthropy in Switzerland, which is in fact something that is in the interest of all but is often ignored as individuals pursue their own interests. We do not feel committed either to any political party or private sector agenda, but want to make use of our independent status to connect key players with one another. We need genuine cooperation to enable us to do this. Especially foundations must work together and not be in competition with one another.
III. Swiss Giving Pledge – is it possible?
With this in mind, we also want to start thinking about a Swiss version of the Giving Pledge. The question we must ask ourselves, however, is this: can an initiative such as the Giving Pledge function outside of the USA? Cultural objections, such as that the Giving Pledge has only been successful because there is a different culture of giving in the USA are of course justified. It is fashionable for wealthy Americans to make donations. Not donating is frowned upon in the USA, and leads to exclusion from high society. Back in 1889, the steel tycoon and industrialist, Andrew CARNEGIE , made the criticism that “he who dies rich, dies in disgrace,” in his book, “The Gospel of Wealth”. The principle of “wealth has its responsibilities” is an essential part of American civilisation.
In fact, Swiss citizens are also good at donating. But unlike in the USA, in Switzerland charity work is usually done in secret. In the case of the Giving Pledge, the visibility of the donor runs contrary to typical “Swiss virtues” (those such as sobriety, pragmatism, modesty and humility). Our motto is “Do good and do not talk about it”. It is precisely this attitude that I believe people in Switzerland can and must change. Whilst it is clear that we want to maintain our humility, we should also champion the following principle: “Do good and talk about it!”For the Giving Pledge is not about putting your actions in the spotlight, but about exploiting any available resources and opportunities to make a difference and also awaken the wider public's interest in philanthropy. With consistent public relations, we could make society, politics and the economy aware of quite specific socially relevant issues, and show that there are ways to solve such problems. With regard to publicity, the Swiss are also critical of philanthropy because they regard themselves as “guardians of democracy”. Especially in areas of national jurisdiction, for example education and healthcare, the public is sceptical of private initiatives – the sentiment is that the state should bear sole responsibility for these. Should wealthy private individuals therefore simply pay more tax instead of donating, and leave the resolution of socio-political problems to the state? No, in my opinion that cannot be the solution; first of all, if you look at the donation statistics, you will see that the total of all private donations in Switzerland is no more than 0.5% of the gross domestic product (GDP). At 1.7%, the percentage in the USA is more than three times as high. Whilst in absolute terms these are significant sums, they are, however, hardly enough to replace the activities of the state, or to compete with government services. Accordingly, citizens who decide to make contributions to society over and above their tax payments should be welcomed with open arms. The state, with its authorities and public sector institutions (for example universities), must learn to accept this support from foundations or private individuals. Doors must not be slammed shut out of fear for one’s own patch, thereby nipping significant social commitment in the bud – as I have already experienced. Because – and this is an important second argument – there are always social needs which neither the state nor the private sector can or even wants to satisfy. Despite our wealth, there are gaps in Swiss society which have so far not been covered by anyone. This discovery was another reason for launching the Müller-Möhl Foundation. With others, we aim to try and draw attention to these gaps, and close them over time.
There is, however, another completely different and compelling argument for the Giving Pledge: professional foundations have the independence and freedom to think and act in a more innovative way than is possible for state institutions. Foundations are the birthplaces of new ideas. They are needed because they can consider and tackle social problems from a completely different perspective - independent from bureaucratic institutions or the direct pressure to be profitable in the private sector. Otto INEICHEN, who died far too early, did exactly that when he began to set up “Speranza”. The organisation broke new ground in tackling youth unemployment and supporting young people facing problems. INEICHEN was not afraid to talk about it either. He used the media and his networks in a targeted way to promote the cause. The fact that he was successful proves that he was right.
IV. Swiss Giving Pledge – an idea worth pursuing!
I believe that a Swiss Giving Pledge is possible and desirable. It is precisely the attractiveness of Switzerland as a location for foundations - with its optimal political, economic and legal environment - which can and must be exploited to the maximum. And we are presumably in agreement about one thing: entrepreneurial attributes, such as hard work, a clever investment strategy and the pursuit of wealth, are also typical of Switzerland. The great Swiss entrepreneurs, such as the HOFFMANN-OERI, SCHMIDHEINY and JACOBS families, Nick HAYEK and Hans-Jörg WYSS, have ultimately given rise to these characteristics, combined with a passion for innovation. Although there are many differences with the USA, there are also parallels to Warren BUFFET and the GATES, particularly in this matter. Before they became philanthropists, they were above all one thing: brilliant entrepreneurs and investors.
With their idea of the Giving Pledge, they are doing nothing other than once again setting a new trend in an innovative and unconventional way. As a result of their highly professional foundation work, they have once again become leaders and role models. They embody a paradigm shift in giving, as traditional philanthropists have recently fallen out of fashion, according to the book “Dead Aid” by economist Dambisa Moyo, which propagates the end of traditional development aid and unilateral dependence. Today's philanthropists no longer regard themselves as social donors, but as social investors who provide not only financial resources, but also their entrepreneurial experience and network, for a good cause. They want to “achieve something and solve problems,” as Bill and Melinda Gates put it, and therefore invest in the common good.
A problem must be comprehensively analysed and a holistic strategy developed to solve it. The Bill and Melinda Gates Foundation does not therefore simply give money for the procurement of anti-malarial medicines, but takes care of the entire “value chain”, from basic research to the best distribution system for the medicines. Working as an entrepreneur is also about working on financially sustainable solutions. An example of this could be the research competition recently launched by the Bill and Melinda Gates Foundation with the aim of inventing a robust easy-to-clean toilet, one that would require no drainage or external power supply, is integrated into material cycles, and costs no more than 5 cents per day per user. Incidentally, the winner was a team from Eawag, the Swiss Federal Institute of Aquatic Science and Technology in Dübendorf, and the Viennese design agency, EOOS.
Professor J. Gregory Dees, from Duke University’s Fuqua School of Business, the Center for the Advancement of Social Entrepreneurship (CASE), re-defines philanthropy as “the mobilisation of private resources to improve the world in which we live, with money, time, social capital and expert knowledge”. The traditional distinction between entrepreneurship and charitable foundations is becoming increasingly blurred. A company aims to generate profit. We philanthropists should aim to do exactly the same, with the fundamental difference that the profit is not used to line our own pockets, but should generate economic wealth that grants everyone the same opportunities for a fulfilled and productive life. The founders of the Giving Pledge have shown courage and foresight. Who dares wins. And this is why the Giving Pledge is not simply a successful PR campaign for the wealthy upper class. The Giving Pledge would like to be a movement that gains as many fellow campaigners as possible. Responsible citizenship should give serious consideration to philanthropy at an early stage. A mutual and public commitment to philanthropy should encourage people to think of the future.
This commitment should help people to learn from each other and exploit synergies, in order to show that socio-political involvement gives pleasure because it can make a difference! Only by working together can we find ways of solving socio-political problems and encouraging others to do the same. For all these reasons, consideration should be given to a Swiss Giving Pledge. And that is why my door is always open for anyone who would like to get involved in this kind of philanthropy.
Published in: Jakob, D. (2012). Stiften und Gestalten - Anforderungen an ein zeitgemässes rechtliches Umfeld. Basel: Helbing & Lichtenhahn Verlag.