Five Lessons from the Greatest Philanthropists

Andrew Carnegie once said, “The man who dies rich, dies disgraced.” His belief fueled a passion for philanthropy that spread among some of the titans of industry of the last century. Carnegie was joined by John D. Rockefeller, Henry Ford, J. Paul Getty, J. Howard Pew, and many others who created massive wealth – and then used their wealth in service to others.

In reading their biographies in The Foundation Builders, a book with concise biographies of twelve of the greatest philanthropists (written by Martin Morse Wooster), I realized they shared several principles of philanthropy:

1. Why wait? Almost without exception, these philanthropists did the majority of their giving while they were living.  Perceiving the challenge of donor intent, they recognized the best way to ensure funds were used as they intended was to give their wealth away while earning it. Construction titan Joseph Jacobs wrote, “I believe that, after the first generation, inherited wealth loses the spirit and the values of the people who earned that wealth. There comes a disconnection between the funds and the source of the funds …”
2. Money can break down the family.Most limited the wealth they passed on to their families—believing that it would spoil initiative and actually harm them. Andrew Carnegie wrote, “Wise men will soon conclude that, for the best interests of the members of their families… [giving large amount of money to heirs] is an improper use of their means.”
3. Wealth can destroy others. Most philanthropists seemed to be obsessed that their giving would not reward slothfulness, but rather stimulate hard work and dignity:John D. Rockefeller’s “constant nightmare was that he would promote dependence, sapping the Protestant work ethic. He dreaded the thought of [many people being] addicted to his handouts.” Henry Ford explained, “We believe that what is called being charitable is a particularly mean form of self-gratification – mean because, while it pretends to aid, it really hurts.”
4. Hard work and modesty were always part of their secret sauce. Instead of megalomaniacs, the vast majority were rather humble and hard-working. Andrew Carnegie: “This is the duty of the man of wealth: To set an example of modest, unostentatious living, shunning display or extravagance; to provide moderately for the legitimate wants of those dependent upon him, and, after doing so, to consider all surplus simply as trust funds, which he is called upon to administer… in the manner which, in his judgment, is best calculated to produce the most beneficial results…”
5. Forgotten good: Their business. These stories celebrated their philanthropy, but I found myself amazed at the way they ran their businesses. Henry Ford regularly would hire people others wouldn’t. He took great satisfaction seeing them become productive employees: “In 1919, nearly 20 percent of his workers had some sort of disability… Former criminals – including violent ones – were also given a second chance at Ford plants.” It wasn’t just their philanthropy that impacted the world; the way they grew their businesses had an even more dramatic impact on improving families.