Like Mark Zuckerberg, some tech titans are more generous than others

Facebook founder Mark Zuckerberg recently gave $25 million to help tackle the Ebola epidemic. It's an impressive and much-needed donation, coming from a very wealthy young man who has become increasingly philanthropic. He's actually now one of the most generous of American donors when generosity is measured not solely by amounts donated, but as the proportion of total wealth of an individual or company.

Earlier this year, Inside Philanthropy published an eye-opening list of the most generous and least generous of US technology moguls on its website. The roster is likely to surprise – because some household names are on the "least generous" list, while total unknowns are on the "most generous".

The number-one tech industry donors in terms of proportion of personal wealth given are Leonard Bosack and Sandy Lerner. Who? you may well ask. They are the founders of networking giant Cisco, and put more than 70 per cent of the total $170 million buyout in 1990 they received as Cisco co-founders towards charitable causes. Bill and Melinda Gates are likely to eventually hold the number one slot. They've put billions into their foundation, but it represents less than half of their personal wealth.

Philanthropy remains a too-unusual calling within this sector. Despite the vast wealth in the technology industry, it seems to be one of the worst for philanthropy both on the corporate and individual side, according to surveys by philanthropic organisations. Amazingly, Silicon Valley, as a region, performs below the average for giving in the United States.

Despite generous donations from individuals and a growing number of corporate foundations, corporate giving is down enormously on what it used to be, even factoring out booms and recessions.

An article in online magazine Slate last year noted that corporate giving has dropped from 2.1 per cent of pretax profits in 1986 to only 0.8 per cent in 2012. Overall, US businesses contribute only about 6 per cent of private sector donations and barely over 1 per cent of the $1.5 trillion charitable economy in the US.

In Ireland, the numbers are likely to be much lower. There is a poor tradition of corporate philanthropy in Ireland, and not much of an ecosystem for individual donations. Yes, Ireland has figured high in per capita donations for events such as the original Live Aid, but few have a regular habit of giving, especially not in sustained monthly giving or the private bequests that most help not-for-profit bodies.

Tax incentives

A big part of the problem is that the tax system, though improving, offers meagre benefits to donors. Corporates only get a 12.5 per cent tax break on donations (related to the amount of tax they pay).

On donations of €250 or more per year, individual donors claim tax benefit dependent on their taxation band, and the tax benefit (for PAYE earners) accrues to the charity. The same proportional charitable benefit does not happen for self-employed donors – which is silly.

This system is clumsy in many ways. Many individual PAYE donors fail to return the form that enables charities to accrue the additional benefit. And why such a gap in benefit for corporate donations? Why not treat their donations at the same rate as individuals, with a similar additional kickback to the charity? (Why should Ireland’s low corporate tax rate penalise charitable giving as an unwanted knock-on effect?) And why cannot charitable taxation benefits be an easy, transparent process, as in the UK and US?

Another Irish problem is that non-profits looking for donations from Irish-based tech multinationals often find it hard to locate an individual capable of making donation decisions, as operations here frequently do not include anyone with such authority. This is ridiculous. Multinationals are part of their local community and should be involved in giving back to it. Likewise, SMEs should have philanthropy as part of their ecosystem from the start.

There’s more to be said on research and development, and I’ll come back to it soon. Meanwhile, if you want to do more (and you should),visit Philanthropy.ie for resources on giving wisely and well.

And as for those tech titans who give little, relative to net worth (assuming they are not giving ginormous amounts anonymously)? According the Inside Philanthropy , they are Jeff Bezos, Larry Page, Jerry Yang, Larry Ellison, Steve Ballmer and Michael Birch. See iti.ms/10o7XDS for the top 12 tech philanthropists