Global Billionaires Interested in Philanthropy - Census

The world’s 2,325 billionaires, on average, donate just over US$100 million cumulatively over their lifetimes to philanthropic causes, according to a global wealth census.

This is equivalent to just three per cent of their net worth – more than the average billionaire’s real estate holdings.

The Wealth-X and UBS Billionaire Census 2014  shows that 51.9 per cent of billionaires, including those in Australia, say they have an interest in philanthropy but in reality many more are actively involved in giving.

The report found that 155 new billionaires were minted in 2014, pushing the global population to a record 2,325 – a seven per cent rise from 2013.

The report said the combined wealth of the world’s billionaires increased by 12 per cent to US$7.3 trillion, which is higher than the combined market capitalisation of all the companies that make up the Dow Jones Industrial Average.

It found that at least 35 per cent of the world’s billionaires have their own private foundations, and more than 70 per cent are active in the philanthropic sphere, either by making financial contributions, acting on the board of various social and Not for Profit organisations, or both.

“The other 30 per cent of the world’s billionaires are not known philanthropists, but may be involved in philanthropic causes discreetly, preferring to donate anonymously for personal, cultural or religious reasons,” the report said.

It found that the majority of billionaires contribute to numerous charities, but tend to channel the bulk of their philanthropic contributions into one cause.

For 28.7 per cent of billionaires, their top cause is education or higher education, with some of the largest individual gifts going to universities.

“Many billionaires view philanthropy as a means of preserving their cultures and values for future generations. As part of the intergenerational wealth transfers currently underway, billionaires will leave bequests to foundations and to specific causes that each individual billionaire supports,” the report said.

Billionaires – defined as those individuals with a net worth of US$1 billion or above – control nearly 4 per cent of the world’s wealth.

The report shows that Australia has 32 billionaires worth an estimated at $US90 billion with Sydney being home to the highest number of billionaires – 14 billionaires worth a total of $30billion.

The average age of the typical Australian billionaire is 63. The report said that most billionaires do not reach the US$1 billion threshold until their late forties: 93 per cent of the world’s billionaires are older than 45 years.

Only three of Australia’s billionaires are based outside of Sydney, Melbourne and Brisbane. Perth’s billionaires have the highest mean net worth of the region but the report said this wealth is primarily concentrated among members of one particular family.

1. SYDNEY, AUSTRALIA 14  worth $30b

2. MELBOURNE, AUSTRALIA eight worth $24b

3. BRISBANE, AUSTRALIA four worth $11B

4. PERTH, AUSTRALIA three worth $20b

5. AUCKLAND, NEW ZEALAND two worth $7b

While the report found that there are 103 billionaires based in New York City – the top billionaire location in the world – Sydney is home to 41 per cent of the region’s billionaires and is the city with the largest proportion of foreign-born billionaires.

“Only one of Sydney’s billionaires has fully inherited his fortune, and with an average age of 69, succession planning is an increasingly relevant issue for the city’s billionaires,” the report said.

“So far, of those who have at least partially made their own fortunes, two thirds have further grown their wealth. The next generation of billionaires is likely to follow in these footsteps.”

Sydney Statistics

Mean Net Worth :      US$2.1 billion

Average Age:             69 years

Top Industry:              Finance, Banking & Investment (29 per cent)

• 93 per cent of Sydney’s billionaires at least partially made their own fortunes.

• Only 21 per cent of Sydney’s billionaires were born outside of Australia.

• At least 64 per cent of Sydney’s billionaires have earned a bachelor’s degree.

• 57 per cent of Sydney’s billionaires’ primary businesses are privately owned.

• There are no female billionaires in Sydney.

• 86 per cent of Sydney’s billionaires are married.

• 86 per cent of Sydney’s billionaires are active philanthropists, with the majority actively contributing to health-related causes.

• 36 per cent of Sydney’s billionaires share an interest in boating.

Europe has retained its position as the region with the highest number of billionaires (775), while the United States remains the country with the highest number of billionaires (571).

Billionaires in the United States now account for nearly 25 per cent of the total global billionaire population.

“The massive wave of intergenerational wealth transfer from baby boomers to their heirs is underway, and this has had a profound impact on the world’s billionaire population: billionaires with partially inherited wealth were the fastest growing segment of this population.

Yet, the report said one of the common characteristics of the world’s billionaires is their entrepreneurialism. “In most instances, achieving billionaire status requires more than just inheritance; 81 per cent of billionaires made the majority of their fortunes themselves.”

The report found that there are 286 female billionaires with over 65 per cent of the world’s female billionaires fully inheriting their wealth. The report said that one of the reasons for this phenomenon is that 21 per cent of female billionaires are widowed and many have inherited their husbands’ wealth.

The top five billionaire cities are:

For the full list, go to http://www.wealthx.com/articles/2014/top-20-billionaire-cities/

Download the Wealth-X and UBS Billionaire Census 2014 at www.billionairecensus.com