Warren Buffett's Sister Takes Direct Approach to Philanthropy

After pledging more than $35 billion to the Bill & Melinda Gates Foundation last year, Berkshire Hathaway chairman and CEO Warren Buffett received boxes full of letters from individuals asking for money, the Wall Street Journal reports. He, in turn, forwarded them to his sister, Doris, whom he knew he could trust to give them a sympathetic hearing.

Doris Buffett estimates that the Sunshine Lady Foundation she established in Wilmington, North Carolina, has received more than three thousand letters from her brother's office and has awarded at least $1.4 million to more than three hundred people — an average of about $4,800 each. Volunteers assembled from an informal network of friends screen the letters, and part-time assistants verify the writers' claims, requesting tax returns, medical records, and other third-party verification, including notes from attorneys, pastors, or employers. Possible recipients, who never receive enough to solve all their financial needs, must also verify that they receive all the government assistance for which they are eligible.

Raised during the Depression, Doris Buffett said she never experienced real wealth until after her mother died in 1996, leaving her an inheritance from a family trust established by her father, stockbroker and congressman Howard Buffett. And while she is undeniably wealthy, Buffett usually keeps no more than $5 million in assets in her foundation, which has five full-time and eight part-time employees. In addition to the money it sends to individuals, the foundation has donated more than $40 million to victims of domestic violence to pay for college or other courses, as well as to small nonprofits such as shelters and early reading programs.

Buffett's personal approach and reliance on friends and other non-professionals is relatively unique, said Melissa Berman, president and CEO of Rockefeller Philanthropy Advisors. While it's not unheard of for people in need to seek help from the rich, most private foundations operate at a remove from the people they support. Even John D. Rockefeller, who used to give dimes to people on the street and responded to strangers who sent letters pleading for money, subsequently realized he needed an objective system for giving money to others, Berman said.

Yet, like her brother, Buffett is extremely frugal, even in her generosity. "We're supposed to empower, but not enable," she said. "It's a fine line, and I think it makes [recipients] more responsible in the end."

Sally Beatty. "The Other Buffett" Wall Street Journal 08/03/2007.