South African mining billionaire, Patrice Motsepe, has donated half of his wealth to charity. Motsepe, through his family foundation, Motsepe Family Foundation, will fund education, health and other initiatives with his unprecedented act of philanthropy.
The Motsepe family, through their pledge, is joining the likes of Microsoft founder Bill Gates and Billionaire Warren Buffet of United States in the “Giving Pledge’ initiative which encourages wealthy people to donate at least half of their money to charities. The Giving Pledge initiative was instigated by Gates and Buffett and they have been able to persuade nearly 100 billionaires to pledge the bulk of their wealth to charity, but so far, most of them are Americans.
The Motsepe foundation was created in 1999 and it has been working with communities, church groups and schools. It has also made contributions to the UNICEF as well as a number of foundations in South Africa, including the Nelson Mandela Foundation.
Speaking in an interview with MoneyWeb, Precious Motsepe, Patrice’s wife, explained the thoughts behind the new initiative. “We’ve been inspired by the giving pledge that was started by Warren Buffett and Melinda and Bill Gates. Patrice last year met with Warren to discuss further and understand the giving pledge. And in November, last year, we discussed with the family that this is the way we want to take our giving. We’ve always been giving as a family, but now we wanted to take it to another level,” she said.
Motsepe’s announcement marks a major milestone in South African philanthropy. Black Economic Empowerment (BEE) expert and managing director of Black Lite Consulting, Ajay Lalu, also hailed Motsepe’s philanthropic initiative.
According to him, “For a long time we’ve been looking for BEE to be more philanthropic. I think for the first time we are starting to see that emerge. I hope this is going to spur other BEE beneficiaries to follow a similar route,” he said.
Motsepe who has been described as the first richest black South African to emerge from post-apartheid South Africa, with a calculated net worth of $2.65bn (R24 billion) in November, said, “It’s a recognition that people in my position, and me in particular, have a huge responsibility to South Africans who are less fortunate — those who are unemployed, poor and marginalised — and to make a humble contribution to improve their lives and living conditions.”
“We’ve got many, many years ahead of us. It’s not as if there’s going to be a huge lump sum available. There’s going to be significant money available…. It’s a lifelong obligation in my life and my wife’s life and then our trustees who will look after our money when we’re gone,” Motsepe said at a press conference on Wednesday.
Motsepe, who founded and chairs JSE-listed mining group African Rainbow Minerals (ARM), which has a market capitalisation of 43 billion rands ($4.7 billion) declined to put a value on cash flow to the foundation but said funds for the foundation will be drawn from returns on investment rather than selling down investment holdings.
The money will be distributed to various issues affecting the poor including health, education, unemployment and the upliftment of women. He will be making donations towards making South Africa a better place while consulting with church and traditional leaders, as well as various charities, to decide where the money goes.
According to him, the most effective way to deal with joblessness and poverty is to create a business environment that is globally competitive and attractive to the private sector.
“We don’t want Africa to forever be a continent of charity and a continent of donations. We want Africa to be self-sustaining,” the 51-year-old mining tycoon said.
“People in my position have a huge responsibility to South Africans who are less fortunate.”
“I decided quite some time ago to give at least half of the funds generated by our family assets to uplift the poor and other disadvantaged and marginalised South Africans but was also duty-bound and committed to ensuring that it would be done in a way that protects the interests and retains the confidence of our shareholders and investors,” Motsepe said.
While congratulating Motsepe on this feat, Gates said, “It was a wonderful thing to hear how the Motsepe’s really, as part of their moral conviction as a family, believe in giving back. I want to congratulate them.”