Peter and Jennifer Buffett, founders and co-chairs of the NoVo Foundation, gave their thoughts on philanthropy on March 20 as part of the Distinguished Speaker Series hosted by the USC Center on Philanthropy & Public Policy.
Following a luncheon in Beverly Hills, the Buffetts spoke of the need for a strategic focus in philanthropy, taking a hands-off approach with grantees, the importance of working with partners and their plans to spend down their foundation, which aims to oversee a change in society from exploitation to cooperation.
Peter Buffett admitted that the last goal may be difficult, thanks to the generosity of his father, legendary investor Warren Buffett. In 1997, Buffett gave each of his children – Peter, Howard and Susie – $100,000 to start their own philanthropic foundations.
During Christmas of 1999, each foundation was awarded another $10 million gift. Then on June 26, 2006, what Peter Buffett described as “the big bang” occurred. His father pledged 350,000 shares of Berkshire Hathaway stock valued at about $1 billion toward each of the foundations.
An acclaimed musical composer and producer, Peter Buffett had been advancing his career while dealing with the foundation on the side. He realized it was time to take a step back and talk about strategy and infrastructure for what suddenly was one of the top 75 foundations in the United States based on annual giving levels.
Over the next couple of years, Peter and Jennifer Buffett spent most days meeting with thought leaders from foundations, nonprofits and international groups to get a sense of their opportunity and decide on a direction.
“This was a really important time before we put a stake in the ground to find ourselves,” said Jennifer Buffett, who serves as president of NoVo. “We sort of hid away. We traveled around the world. Warren did something that we would forever thank him for in terms of trusting us so completely and giving us a blank canvas. The only thing he basically said is try to focus on a couple of things and know the difference you’re trying to make and how, and go some place that really isn’t being focused on.”
Peter Buffett looked over all the gathered information in a way similar to how he remembered watching his father pore over stock reports to find the undervalued asset. His father would spend days, weeks, months and sometimes years to find that asset, but when he identified it, he knew that all he had to do was invest and wait.
“As we looked around the philanthropic world, we saw health, we saw environment, we saw education, we saw poverty, we saw all these things that needed addressing,” Peter Buffett said. “And yet what seemed to go across all of them was supporting the girl. In fact, the adolescent girl was the undervalued asset. We realized if we invested in her that we didn’t have to do very much else. She was the most efficient way to change the world.”
Since adolescent girls are the future mothers of all children, the Buffetts believe that improving the quality of life for adolescent girls in developing countries will have a ripple effect.
The Buffetts set out to create relationships with grantees in which they are told the truth rather than what people think they want to hear to get the money. That usually means forming long-term relationships rather than one-off grants.
They also wanted to avoid what Peter Buffett called philanthropic colonialism or barging in as outsiders and forcing their solutions on other people’s problems.
“You have to stay out of the way,” he said. “It’s the dynamic of finding people on the ground who have the credibility and the resources and the reach, and we just support them. Instead of thinking you’re going in to solve somebody else’s problem, work with people who understand the intricacies and complexities of the problem.”
The NoVo Foundation makes about $55 million in grants a year. Their largest contribution is an ongoing $90 million partnership with the Nike Foundation for the “Girl Effect” initiative, which focuses on providing a better future for girls living in poverty.
For their work in empowering girls and women, the Buffetts were awarded the Clinton Global Citizenship Award in 2008. Their involvement in philanthropy has changed the way they look at life.
“I think our hearts have been totally broken, and our minds have been opened,” Jennifer Buffett said. “We went from living our personal stories and dramas to participating and living every day in the big story of life.”
The Buffetts believe it is important for philanthropists to take a long-term view and not concentrate on what they can accomplish.
“Don’t go into it thinking you’re going to solve something and save the day,” Peter Buffett said. “You may be dead before the solution happens. These are generational things. They’ll take a lot of time.”
He hopes to see the day his father’s gift is exhausted, and NoVo ceases to exist.
“I think every foundation should want to end,” he said. “We don’t have time to preserve things. It’s time to move the money, in a responsible way, as best you can because the problems are now.”
James Ferris, director of the USC Center on Philanthropy & Public Policy, said: “The remarks resonated with the group of leaders from philanthropy and the community. Jennifer and Peter were so adept at linking their issues and passion to a strategic approach to philanthropy and the need to ensure the capacity of the nonprofits they support.”