Mark Zuckerberg’s massive $45 billion philanthropic effort raises concerns

In his first interview after launching Facebook for Harvard students in 2004, Mark Zuckerberg offered a succinct explanation for why he decided to leapfrog the university’s own plan to build a campus social network: “I can do it better than they can.”

On Tuesday, the Facebook cofounder and CEO published a far less succinct note addressed to his newborn child laying out plans for his next major venture with wife, Dr. Priscilla Chan, to give 99% of the family’s Facebook shares, currently valued at around $45 billion, to a new philanthropic initiative. The 2,200-word announcement was littered with loud humility — “We know this is a small contribution…” — but the subtext of the entire effort is once again that Zuckerberg can do it better.

“Our hopes for your generation focus on two ideas: advancing human potential and promoting equality,” Zuckerberg and Chan wrote in their open letter, explaining high-level goals for the Chan Zuckerberg Institute. “This mission… will require a new approach for all working towards these goals.”

That new approach will combine more traditional philanthropic activities with public advocacy (lobbying for issues, for example) and “other activities for the public good,” according to Facebook’s filing with the Securities and Exchange Commission. All of that will be housed in a limited liability company (LLC) rather than a non-profit, freeing up the Zuckerberg family to do more than simply make charitable donations. An LLC would allow the company to pursue joint ventures with other companies and make investments in startups, for instance. Incorporating as a non-profit would require the Zuckerbergs to give away 5% of the money held within it every year — an amount that could really add up quickly.

Like most of what Facebook does, Zuckerberg’s personal announcement has elicited strong and strikingly opposed reactions in different camps, largely based on the decision not to go the usual non-profit route. At heart, however, the debate effectively boils down to whether you think Mark Zuckerberg is a benevolent billionaire do-gooder or a shameless capitalist in search of a tax break.

Zuckerberg Baby

Mark Zuckerberg and wife Dr. Priscilla Chan with their newborn daughter, Max.

IMAGE: FACEBOOK

The Zuckerberg paradox

The philanthropic move was praised quickly and widely by many in the philanthropic community as well as some of Zuckerberg’s billionaire peers, including mentors Sheryl Sandberg, Warren Buffett and his chief role model, Bill Gates, who called it “fantastic, inspiring news.”

“Zuckerberg is part of a generation that wants to do good by giving out alms in traditional ways, but also by investing intelligently,” says Karl Zinsmeister, VP at The Philanthropy Roundtable and author of The Almanac of American Philanthropy. “I have no qualms whatsoever about him setting up an LLC verses a 501(c)(3) [non-profit].”

Beyond this community, however, some industry watchers expressed skepticism and cynicism over the structure of the philanthropic institute and the decision to create a for-profit charity, potentially paving the way for Zuckerberg to transfer his billions with far less tax penalties and the freedom to use that money however he sees fit.

 

Source : Mashable

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Notice: Trying to get property 'menu_class' of non-object in /home/bizztorcom/public_html/wp-content/themes/woodmart/inc/functions.php on line 1012

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Notice: Trying to get property 'menu_class' of non-object in /home/bizztorcom/public_html/wp-content/themes/woodmart/inc/functions.php on line 1011

Notice: Trying to get property 'menu_class' of non-object in /home/bizztorcom/public_html/wp-content/themes/woodmart/inc/functions.php on line 1012

Notice: Trying to get property 'menu_class' of non-object in /home/bizztorcom/public_html/wp-content/themes/woodmart/inc/functions.php on line 1011

Notice: Trying to get property 'menu_class' of non-object in /home/bizztorcom/public_html/wp-content/themes/woodmart/inc/functions.php on line 1012

Notice: Trying to get property 'menu_class' of non-object in /home/bizztorcom/public_html/wp-content/themes/woodmart/inc/functions.php on line 1011

Notice: Trying to get property 'menu_class' of non-object in /home/bizztorcom/public_html/wp-content/themes/woodmart/inc/functions.php on line 1012

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