Open Society Foundations founder George Soros has transferred nearly $18 billion in recent years to the philanthropy, making it the second-largest private foundation in the United States by asset size, the Wall Street Journal reports.
OSF now holds the bulk of Soros's fortune, and the 87-year-old founder of Soros Fund Management LLC plans to give most of the rest to the foundation during his lifetime or upon his death, people familiar with the matter told the Journal. Soros also has moved to share decisions about his firm's strategy with OSF's investment committee, while, in a break with past practice, the firm's new chief investment officer, Dawn Fitzpatrick, reports not to Soros but to the philanthropy's investment committee.
"It's an ongoing process of migration from a hedge fund toward a pool of capital deployed to support a foundation over the long term," said Bill Ford, a committee member and chief executive of General Atlantic LLC.
According to Foundation Center data, the Foundation to Promote Open Society (which, along with numerous other entities around the world, falls under the OSF umbrella) held $7.3 billion in total assets as of December 31, 2015. If the nearly $18 billion was transferred after that date, the foundation's total assets would now total some $25 billion, second only to the Bill & Melinda Gates Foundation, which held total assets of more than $40 billion at the end of 2015.
Foundation officials told the New York Times that, in the past, Soros has funded the group through donations of roughly $800 million to $900 million annually, and a foundation spokesperson told the Journal that Soros and OSF have awarded grants totaling $14 billion to date. Now that Soros Fund Management's main client is an endowed philanthropy, however, several people close to the firm said they expected it to curtail its large "macro" trades — wagers on the direction of currencies, stocks, commodities, or interest rates. Foundation officials also told the Times that the foundation was not planning to increase its grantmaking budget or dramatically expand its programming any time soon.
Bloomberg notes that Soros and other hedge fund managers are faced with the elimination of a favorable tax break at year end. The 2008 measure requires hedge fund managers who earned fees outside the United States and did not pay taxes on those fees to repatriate those revenues — estimated to be as much as $100 billion — by December 31. According to Irish regulatory filings, at the end of 2013, Soros had amassed $13.3 billion in Soros Fund Management through the use of deferrals, Bloomberg reports.