Google Sets Aside $1 Billion for Causes
Not doing “evil,” as the Google Inc. slogan goes, isn’t enough for the Internet giant. It now wants to put its wealth to work doing good.
Google said Tuesday that it would reserve nearly $1 billion for a charitable foundation launched under the umbrella of Google.org. Issues the company plans to address include world hunger, clean water and alternative energy sources.
“We aspire to make Google an institution that makes the world a better place,” said Sheryl Sandberg, a company vice president who is part of a team overseeing Google.org until a permanent director is hired.
As co-founders Sergey Brin and Larry Page promised in an unusual “owner’s manual” for shareholders before Google’s initial public stock offering in August 2004, the company said Tuesday that it planned to set aside 1% of its equity for philanthropy, which translates to 3 million shares.
Those shares were worth $918 million at Tuesday’s closing price of $306.10. The value of the charitable fund will rise and fall with the volatile stock price.
The Mountain View, Calif.-based company also plans to donate 1% of its earnings each year. The company had net income of $968 million in its first four quarters as a public company, which would translate to an additional $9.7 million in donations.
The Internet titan will start the Google.org foundation with $90 million earmarked for gifts to nonprofits, Sandberg said. Early recipients include Acumen Fund and TechnoServe, which tackle poverty, as well as water-quality research efforts by academics at Harvard University and UC Berkeley.
Google.org also will fund its own projects. For example, the company will accelerate a program, begun in 2003, that has given $33 million worth of free ads in its search engine to 850 nonprofits, including the Red Cross and the Make-A-Wish Foundation.
The Google foundation also will collaborate with for-profit companies and nonprofit organizations that are trying to accomplish social change. Google said, for example, that it gave $2 million to a Massachusetts Institute of Technology program designed to develop a $100 laptop for students.
It’s not unusual for companies and their wealthy founders to create philanthropic foundations. Twenty foundations nationwide had more than $2 billion in assets through 2003, according to the latest statistics available from the Foundation Center, a group that tracks philanthropy. The Bill & Melinda Gates Foundation, funded by Microsoft Corp. Chairman Bill Gates, tops the list with $26.8 billion in assets.
But Google stands apart in one respect: It has been publicly traded for little more than a year.
“What’s interesting is that they’re such a young company doing this,” said Stacy Palmer, editor of the Chronicle of Philanthropy in Washington.
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Associated Press was used in compiling this report.
