In our new and improved news tab, I saw a story posted by Chachaji about how Mukesh Ambani was now, at least temporarily, the richest man in the world!
Billionaire Mukesh Ambani today became the richest person in the world, surpassing American software czar Bill Gates, Mexican business tycoon Carlos Slim Helu and famous investment guru Warren Buffett, courtesy the bull run in the stock market.
Not actually the richest man in the world, but he is in the top five.
Following a strong share price rally today in his three group companies…the net worth of Mukesh Ambani rose to 63.2 billion dollars (Rs 2,49,108 crore). In comparison, the net worth of both Gates and Slim is estimated to be slightly lower at around 62.29 billion dollars each, with Slim leading among the two by a narrow margin. [Link]
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p>If this was true, I thought, it was a meteoric rise. In 2006 he was ranked 56th richest in the world according to Forbes, in March of 2007 he was still only number 14. That got Rajni the monkey fact checker curious, so she poked around further.
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p>It turns out that Ambani isn’t the really richest man in the world, although he may be in the top 5 along with Carlos Slim, Bill Gates, Warren Buffett and Lakshmi Mittal:
Reliance Industries moved swiftly on Tuesday to deny a report that company chief Mukesh Ambani has become the world’s richest man thanks to a surge in stock market. An agency report putting his wealth at $63.2 billion hailed his rise as another triumph for the nation’s booming economy. But Reliance said Ambani was not quite so rich after all, with a net worth of somewhere in the region of $50 billion. [Link]
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p>This is still a huge increase, seeing as he was worth only $20 billion in March, but it doesn’t put him at the top of the heap either.
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p>Honestly though, to me this is all arcane like counting angels on the head of a pin. Once you’re wealthier than Midas, it doesn’t matter to me how much you have. My question is, when will Ambani and Mittal become philanthropists at the level of Buffett and Gates?
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i forgot to mention that “philanthropic” donations can be defined as such under the assumption that every factor earns its “marginal” value (an assumption of neo-classical economics). now i am not arguing that one rather than the other is correct, but alternative arguments are also worth considering.
Well, there is this:
http://www.ispsquash.com/MittalChampionsTrustProfile.htm
It’s a small amount but its a start.
Regarding Mr. Gates’ philanthropic methodologies:
So what does this proof consist of? In case you are wrong, and no material improvements happen, do you have to give the money back to the Gates’ Foundation?
Grant money is often given in tranches which are contingent on progress against particular benchmarks along the way. I don’t know how the Gates’ Foundation works, but this is generally how you use an outcome based methodology in grants giving.
There’s a great profile of Ambani in Conde Naste Portfolio; it details his plans for a $1 BILLION (yes, that’s correct) home he’s building in Mumbai. That’s level of extravagance is just shameful.
here’s the link: http://www.portfolio.com/executives/features/2007/10/15/Mukesh-Ambani-Profile
The article mentions a “Reliance Foundation” which is part of their charitable giving, but I couldn’t find a web page for it in the short time I was searching. Does anybody have a URL?
this is interesting. why do you think the indian media doesn’t focus as much on charitable celebs/rich people? or why do indian celebs not focus as much on publicity for their charity causes? i’m pretty sure that at least in Andhra Pradesh the example I gave earlier (Chiranjeevi) is pretty well-known about. i guess one of the reasons might be that in the indian actors + actresses, cricketers, etc. are seen as gods of sorts, more separate from the masses than they are in american (and i guess australian) media. and it would possibly lessen that image for stars to start being charitable toward those who idolize them?
Moor Nam, you’re of the “Let them eat cake” school of thought, whereas I’ve always believed (long before the movies) that “With great power, comes great responsibility”
ugh… excuse me if I’m kind of sickened by the image of ‘well-groomed children’ ‘traipsing’ in around a ‘modern’ complex guarded from the ‘shantytown’ next door. and this lady has got to be kidding me! just like i am perplexed when americans overlook the poor in their own country, i am also perplexed by this, and india has a much worse poverty problem. i wonder what mrs. ambani is going to do for the poor in africa? build a school for the elites in capetown, perhaps? yeah, that’ll help.
Nala,
There is no point jumping the gun, I believe the school is a business venture like any other. I don’t the two paragraphs Ennis quoted should be read in conjunction with each other. If you are aware of Bombay’s geography, the school is located at the Bandra Kurla complex which in addition to being the fastest developing corporate park is in close proximity to Dharavi.
ok, I don’t know much about Bombay.
Just as an fyi, the two paragraphs quoted by Ennis appear in that same order from the article.
nala, i don’t know about all indian celebs, but it’s fairly well known that people like tendulkar, dravid guard their privacy quite fiercely, even when it comes to most of their private philanthropic activities. when they are associated with charity events to do with their sponsors or with the ICC or BCCI, they are less private. my feeling, based on nothing but my own observations, is that indian celebs, despite all the excessive adoration heaped on them, or maybe because of it, still enjoy a level of (although declining) privacy that western ones don’t. but i think that’s changing and you see the same sort of invasive coverage of their lives now- and they also exploit that as well of course. nothing wrong with publicity for charity causes or using your money/fame to support a cause, especially if you have such sway over a large segment of the population (i don’t think it lessens their image, but enhances it). however, i just wish some – like the cricket fans i mentioned – would stop assuming that because they don’t read all about it in the newspapers that the person in question is selfish.
Charitable efforts of reliance energy Tata Mukesh Ambani’s Reliance Industries.
More on Tatas
Brown: Great work in providing links. I am too busy these days at work, otherwise I could provide more inf. However, there is ample evidence that both Mukesh and Anil are, and will continue tradition of their late Father Dhirubhai (not only in Gujarat and Maharashtra, but throughout India and elsewhere) and get more involved in philantrophy as time goes by. Give the guys some time, for heavens sake!!
He has the time to spend $1 billion on the most expensive house in the world, and that’s something that requires a lot of thinking and planning no? Far more than a charitable campaign would be. It’s not the case that he’s all work.
As for the links, I’m still not impressed when it comes to Ambani. Firstly, those are charitable efforts by his corporations, not by him. Secondly, the link to Reliance Industries has examples like the very fancy international school for the elite, and the “Dhirubhai Ambani Scholars Scheme for meritorious children of Reliance shareholders”. I know that more and more regular Indians are getting into the stock market, but my guess is that the children getting the benefits of this charity are not the most needy. Instead, it’s money going from the corporation to the shareholders.
Yo Dad, you might be right that he’ll become a Sanyasi when he’s older, but he’s 50 already and isn’t that the traditional age for such action? 😉
More like 75
Ennis,
The house is useless publicity, the land in altamount road where the building will be is the lion’s share of the $1 billion value, the plot of land is about 4,400 sq meter of property in the most expensive residential are of Bombay. BTW gates’ house is one of the most expensive residential properties. He own a large part of his corporations and they are run like family businesses, you can’t separate the individual from the families in the traditional sense. BTW if you have an agenda you can find fault with anything anyone cites;)
Charity and philanthropy is a very personal thing, as well as how to spend the your own money. Each individual, at the end of the day, will decide to spend money in a way compatible with their own belief system. Sure, with great power comes great responsibility – but there isn’t a timeline/timeframe set on it. Many give money to charity when they die, others prefer to take a more pro-active role. The point I’m trying to make is imposing our own value system on the rich, for charity, is really like trying to impose something like religion on another person. You won’t be happy until it matches what your own agenda/vision is. I think this is also one of the reasons why Americans actually do give quite a bit – they’re allowed to earn their money and make decisions of where to spend it for themselves and for charity without interference.
The individual nature of our society actually helps promote charity by not forcing it, rather encouraging it in a positive manner. Those who don’t give at times see the positive effects of charity and eventually decide to hop on the train, choosing their own time and place to join the station. Many do it publicy, but one can’t discount those who do it anonymously, either. I know several in my extended family like to take the incognito route. Their thought process is,”I don’t need to show anyone how much I’m giving. If you’re giving, just give it without attaching a name to it. It’s the fact that you’re giving that counts, not the prestige/public image attached to it.”
There is no ‘one’ way. Should the rich be courted for donations/charity? Sure, they have the resources after all. Am I going to judge them for not giving (in a particular amount or for a certain issue) when asked, or that fits my sensibilities? No. My 2 cents. Considering how charity at times intersects with religion, politics, economics, etc., no one is ever going to be completely happy because rich can always do “more”.
Gujudude, Well said, that is exactly the point I was trying to make about publicized charity in the West compared to anonymous nature back home.
Just because we don’t see it doesn’t mean it doesn’t happen.
As it’s said, नेकी कर कà¥à¤ में डाल (do good, drop it in a well)
brown:
There is plenty of unseen charity, especially in India since much of the business happens on a ‘cash’ basis. At least in the past, due to the crazy tax laws, not many rich openly declared how rich they were for the fear that the government or individuals with malicious intent would zero in on them and their family’s wealth. Was it legal? I don’t think so, but the socialist tax code that was recently revised really hampered tax collection and affected other issues. The rich effectively want to fly under the radar. Not only that, but due to the social networks in the subcontinent, several people want to give, but are hestitant because unproductive elements within their extended family or religious structures would see them as a cash cow and use their charitable intentions (and giving money away to charity that doesn’t impact/benefit the extended ‘tribe’) against them doing negative publicity, hampering the social networks that are part of the fabric of life. It’s just one example. Hence, the very private nature of giving. All those temples in India don’t spring up from nowhere. Money is provided to build them.
I know for a fact that those who did give in my experience, would put cash money in an envelope and simply drop it off at a location/institution they trusted. No record of the transaction other than an anonymous slip from the charity stating a contribution of [X] rupees was made.
Another example just jumped in my mind – several of the rich folks would also put the kids of their staff (drivers, factory workers, trusted employees, household labor, etc) through school. Fees, tuition, clothes (hand-me-downs or new), supplies, etc. would be paid by those employing the services of the poor. Obviously, those getting money for their kids would be very trusted, but it tends to go unnoticed when you’re trying to document the level of charity. Sometimes a relative will come over and give a bunch of stuff, which one hands over to their staff, which gets distributed in their family, etc. Not much goes to waste.
I wish I knew the source of that quote, but it’s a pretty common sentiment so maybe there’s no one single source. In any case, I think a crucial fact missing from this argument is that capitalism requires that some people starve. If everybody has a job and enough to eat, inflation goes through the roof. We mustn’t let that happen. Let them eat cake.
But none of these hold for the most wealthy, right? They can’t fly under the radar, and if they wanted to, they wouldn’t be buying houses in the 10s of millions or building them in the $1 billion dollar range.
Here I’m talking about the world’s wealthiest individuals, people who spend gigantic amounts of money on personal consumption.
There is a Microsoft charity as well as a Gates one. If you’re going to count reliance’s charitable contributions, then you have to compare those accordingly.
As for an agenda, I’m merely pointing out that the examples they themselves gave were mainly of the company helping the upper-middle class. If that’s their own best examples of their charitable role in society, I don’t think they’re doing much.
Here we differ. When so many people live on $1/day and others have tens of billions and spend in the tens and hundreds of millions without even thinking about it, yes I expect them to do something of a similar scale for others.
Suppose you could save huge numbers of lives (hundreds of thousands, perhaps even more) with 1% of your personal wealth, wouldn’t you do it? What would you think of somebody who didn’t, but who spent many times that on their own personal enjoyment?
Ennis,
you are cherry picking the examples, there are plenty of examples in both the reliance links which are about helping the needy, but I guess we see what we want to see. Please tell me your verdict on people that patronize restaurants like Masa and Alain in Manhattan where one meal costs more then a years earnings for majority of these people.
The point I am trying to make is where do you draw the line? Lets be honest, poor people welfare is not even distant third in the list of priorities compared to giving to the alma mater and arts foundations. I believe the issue may be that Indian charitable giving doesn’t confirm to the Western notions of excess publicity coupled with Philanthropy. I personally prefer the no noise kind of giving.
But your expectations are aligned with your own beliefs/value system. I don’t know if the Ambanis plan to do something grand or adopt the Carnegie/Rockefellar model by earning a storm up before devoting themselves completely to charity. They may yet fulfill your expectations (as Yo Dad says, “give them time”) but not necessarily the way you see how their money should be spent. That’s what socialist economies are about – redistributing weatlh how others see fit, not letting the invdividual decide. Obviously, it’s a matter of opinion between us, since there is no way to force the Ambanis to fork over money unless you tax them into the ground.
I’ve said this before, when less people tell (instead suggest and creatively market) others how to spend their money, people are far more inclined to do better things with it. When you’ve got people giving you a guilt trip or telling you what you should do with personal property, it doesn’t go over as well (at least that’s my experience). Give the Indian super rich some time – socialist policies of India aren’t too far in the past (where the super wealthy already gave a significant chunk away in taxes and/or bribes, that the government spent poorly).
There are also several that believe in doing good via providing robust economic growth instead of handing it away. Reliance is growing in India by leaps and bounds. A whole bunch of money the Gates foundation provides goes into not ‘handing money over’ (the Africa model of charity), but rather research, development, infrastructure development, etc. In some ways, it isn’t directly providing those earing $1 any immediate income relief. Rather, the resources are providing a means for those earing $1 a day to work their way up.
I’m not, I’m trying to be fair but that’s all that web page mentioned. I went looking in the hopes that I would see something in the way of genuine charity and I didn’t. If I overlooked something, please show me what it was. I just don’t think that scholarships for stockholder’s children is that charitable.
I’m also not saying that all luxury and consumption are bad. But these are people who consume at a very high level, and who have the ability to save tens of thousands or hundreds of thousands or perhaps even millions of lives with a mere 1% of their income. There’s a reason why I have high expectations for them.
As I said earlier:
Did you know that the research that produced the Green Revolution was critically financed by the Rockefeller Foundation and Ford Foundation? Where would India be today if Rockefeller and Ford had never made that sort of charitable gift? The Green Revolution boosted yields by 30%!
Yes, I think that people should value life, and choose to save it, especially when it would take less effort than the other things they are already doing now.
I’m not saying how the ultra-rich should try to make the world a better place, but I am saying I expect them to try. It’s not socialism to recognize moral obligations to your fellow man. Plenty of conservative intellectual figures, including the Pope, make the same point.
Let us also not forget that these incomprehensible amounts of wealth also serve as an inspiration to the less fortunate, and a reminder about the lavish lives they could aspire to if only they could obtain a couple of used bootstraps to pull themselves up by. So, go ahead! Consume conspicuously! The glimmer of hope you provide to the poor unclothed kid on the street could be the reflection of the solid gold logo of your Bugatti in the puddle that he will be splashed by as you play chicken with him on the crowded streets of Bombay.
Guys, I’m withdrawing from the conversation. I’ve repeated myself several times now, I think my positions should be pretty clear. I am not hating. I am not dictating what should be done. I am not saying they should dismantle their companies and turn over all of their corporate assets to charity.
I am saying that at this level of wealth, they have an amazing ability to save peoples lives. They’re already choosing to consume at levels never seen before AND they’re not choosing to make charitable gifts at anywhere near the same level. Doing so wouldn’t weaken their corporations in the slightest bit, nor would it reduce job creation by their businesses.
There really is no downside here for them. Even 1% of their net worth would make a profound difference to people. They’re simply choosing to not do give at any significant level, and certainly not anywhere near the level at which they choose to spend. I think that’s a very important observation to make about them.
this article by peter singer is well worth reading. as is this excellent book. of course, all this turns on what your personal conception of ethics and responsibility is. while i tend to agree with those who would like to see the ambanis give much much more, the ambanis themselves wouldn’t be where they were if they had the scantest conception of ethical behavior.
Green Revolution was critically financed by the Rockefeller Foundation and Ford Foundation?
Sure, and I do not want to take any credit from them.
However,
A lot of that money was through PL 480 grant (it had food assistance written in it) and rupee fund.
Ford Foundation was designated a lot of money by US Government (some of it was loan payment by GOI in rupees – Indian Government did not much foreign reserves back then), which was in rupees, and could only spent back in India (as rupee was not easily convertible). To this day, you can get Ford Foundation grant, that is in rupees, and can only be used in India.
I’m in favor of research and development projects doing better charity, instead of simply handing bags of grain over. I’ve used the Green Revolution as a prime example of how money invested in research can be a catalyst for monumental change.
Fair enough.Many of them are motivated by religion that places emphasis on being charitable. Personally speaking, if I were in the Ambani situation, I would give a lot away to education and research. As you pointed out, we disagree on how we convey it to others with such money.
Mukesh Ambani might not be the richest person in the world as of now but rest assured he will be in the nearest future and he ‘ll remain in the top 3 for a long time to come… Not that it really matters…
As far as Charity goes I dont see the Ambanis going the Bill Gates or Warren Buffet way…. I am sure they do a lot of charity (you can argue its not exactly consummerate with their wealth) and I am sure their charitable donations will only increase in the years to come but a large portion of their wealth will be passed on to the next generation. Most gujjus dont part with their wealth that easily.. :-)I could think of a thousand different ways he could utilise his wealth to benefit the poor but sometimes mere inspiration is enough. YOu can always think “what if he gives away 1 or 2% of his wealth to the poor .. imagine how many lives he can save and change..Thats idealistic thinking …I am sure those ppl have thought about it .. but it never works that way… I beleive its really upto the person as to how much he wants to give away…. we have no say either way and nor should we be jugdemental … to each thy own.
Origins of Rupee fund………..
In the 1950s the US had accumulated a substantial amount of unrepatriatable rupees from the sale of wheat to India.
Rupee fund formed part of kitty for NSF, Ford Foundation, US libraries in India, even funding to places like IITs……it was not all pure philanthropy.
University of Chicago has one of the best collection of South Asian publications and literature in the world.
So is Library of Congress.
They were built through Rupee fund.
Ennis, I agree with you mostly (as in ~ 99%). For me, my hesitation to make blanket statements regarding the responsibilities of the wealthy stem from the fact that there is NOT a social more or expectation that one can be “too wealthy,” so to speak. Morally speaking I disagree, but I also realize that it is problematic to amplify my moral code across the spectrum of high income owners. At any rate, I think wealth inequality and poverty are a social responsibility that falls on everyone. I think part of our conspicuous consumption is also tied to how we evaluate macroeconomic growth.
As someone who worked on a Gates Foundation project, there are a battery of metrics and grant requirements you have to meet both when you submit your grant proposal and when you make subsequent reports to the organization. In our experience the Foundation sent representatives to do field visits, sampled our data collection and quality controls, audited our financial statements/costs, required very thorough and extensive reporting on metrics of success each 1-3 months, etc., etc. They also did not give the money in one “lump sum” — they fronted a portion and then withheld the remaining payments contingent on the performance of the current intervention. If we failed to meet metrics without an adequate explanation (and coordination with the Gates Foundation reps) we were not entitled to receive any more funding, we risked eligibility for any future funding, and we also risked having to return funds. They were not lenient about “failure to meet expectations.” In my experience, both domestic and international, it was by far the hardest grant to manage and maintain.
Pappu @ 88: – Most gujjus dont part with their wealth that easily..
This obviously is a loaded statement. You don’t know jack about so-called “Gujjus”, do you? Have you heard names like: Hutheesingh, Katurbhai Lalbhai, Lalbhai Dalpatbhai, Mangal Girdhar, Mafat Gagal, Navneetlal Shodhan, Ranchhodlal Chhotalal, Sir Chinubhai Baronet, Ambalal Sarabhai, etc. etc. I could go on and on. Some of these stalwarts have given so much (and more) at a slight hint from people like Mahatma Gandhi, and Sardar Patel. I suggest you take efforts in learning about Gujarati people before making shallow observation regarding this or that group of people. Do I sense some degree of jealousy of Gujarati people in tone of some folks on this thread? As I said it is premature to judge Ambanis yet! So Ennis, How many more years for you before you become Sanyasi? Just kidding.
That should be KASTURBHAI. Told you Tripathis are bad at spelling.
Ennis, you have a good point that rich ought to do more, but epiphanies cannot be forced on people. Just as Bill Gates and others realized that they ought to help poor people with their wealth, maybe Ambanis and other Indian billionaires will realize that too.
yo dad beat me to it, but just to reinforce the point, gujarati (and some marwari) businessmen practically financed the congress and its activities.
This obviously is a loaded statement. You don’t know jack about so-called “Gujjus”, do you? Have you heard names like: Hutheesingh, Katurbhai Lalbhai, Lalbhai Dalpatbhai, Mangal Girdhar, Mafat Gagal, Navneetlal Shodhan, Ranchhodlal Chhotalal, Sir Chinubhai Baronet, Ambalal Sarabhai, etc. etc. I could go on and on. Some of these stalwarts have given so much (and more) at a slight hint from people like Mahatma Gandhi, and Sardar Patel. I suggest you take efforts in learning about Gujarati people before making shallow observation regarding this or that group of people. Do I sense some degree of jealousy of Gujarati people in tone of some folks on this thread? As I said it is premature to judge Ambanis yet! So Ennis, How many more years for you before you become Sanyasi? Just kidding.
Yo Dad,
Read my statement 10 times before breaking it down and criticizing it… the operative word here is MOST. most Gujjus generally pass on their wealth to their next generation is what i meant So you cant expect them to become bill gates and Warren buffet donating most of their wealth to charity. I think I know a lot about Gujju culture (atleast the mumbai based ones) since I am a gujju vania myself. My comments are based on observation which is ofcourse different for everyone. I know a lot of gujjus doing charities and anonoymous donations all the time including my family members. And no one is jealous of gujjus on here… its all in your mind… most ppl come here to discuss and share their thoughts and not mudsling … So take it easy and check your tone before you make comments !
Pappu: I will take it easy when folks stop making sweeping genelizations about this or that group of people, without any supporting evidence. I wonder when you identify your own self as a “Gujju” and not a proud ‘Gujarati”, you have any credentials to talk about – in general – Gujaratis. Mukesh Ambani just happens to be Gujarati – a fact that is really not relevant for discussions on this thread regarding rich Indians and charity work. Is it? Thanks for advising me to check my tone. May I suggest you do the same!!
That should be “generalizations”. In tUrn please spank me if I misspell one more time OK!
Yo dad,
I think you are being gracious in trying to explain your stand. Like Ennis I have said all I had to on this topic and I believe there will always be difference of opinions. It is time to bow out.
Brown: You are right. I respectfully rest my case. Tathastu !!