2022 Gates Foundation Annual Letter

I arrived in Seattle 15 years ago this month to lead policy and advocacy for a new division at the foundation focused on global development, which was launched after Warren Buffett’s unprecedented financial commitment to the foundation. At that time, the foundation was expanding its existing work in global health and U.S. education into new areas, including agricultural development; financial services for the poor; and water, sanitation, and hygiene.

I was coming from seven years at the United Nations, where I helped launch the Millennium Development Goals (MDGs) under the leadership of then Secretary-General Kofi Annan. Those goals, adopted in 2000 by every country in the world, set out an ambitious agenda for humanity centered on measurable targets for poverty eradication, health, and education. They and their successors, the Sustainable Development Goals, represent the world’s collective commitment to a better life for all its people.

The goals were very personal to me – and they were the main reason that I decided to leave my job as a journalist at the Financial Times and take my career in a new direction.

I grew up in apartheid South Africa, part of a politically prominent family who fought the legislated crime perpetrated on people of color while also benefiting from the comfortable lifestyle and opportunities offered to us as a white family and to me as a white male. Even as a child, I understood that fundamental unfairness, and it left me with a deep desire to use the advantages I had been given to help tackle injustice and inequality. A career in journalism was my initial entry-point, and that included covering the historic demise of apartheid and the election of Nelson Mandela as president of a democratic South Africa.

The Bill & Melinda Gates Foundation was founded the same year as the MDGs were launched and was born from a similar impulse. In the late 1990s, Bill and Melinda learned that millions of children in lower-income countries were dying of preventable diseases like rotavirus that had essentially been eliminated in wealthier countries. Their background in technology had fostered a faith in the power of innovation to provide opportunities for those who had been left behind, and they were eager to try to overcome the barriers that prevented vaccines and treatments from getting to the poorest. At the same time, conscious of the enormous benefits they had received from their own educational opportunities, they launched an ambitious set of investments to try to improve public education in the United States, focused particularly on providing more opportunities for Black, Latino, and low-income students to graduate from high school and pursue a college education as a pathway to a better life.

Related: Our story

• Learn more

The foundation’s vision of building new partnerships across the private and public sectors to leverage innovation for the poor bore early fruit. For example, we joined a range of governments and other partners in the early 2000s to form Gavi, the Vaccine Alliance and the Global Fund to Fight AIDS, Tuberculosis and Malaria—two groundbreaking initiatives that have saved about 60 million lives.

But these were too often the exceptions. In practice we tended to focus disproportionately on a small set of partners primarily located in the United States and Western Europe and saw little need to engage directly with governments or connect our work to wider agendas like the MDGs.

We often let our enthusiasm about a potential breakthrough innovation blind us to the reality of the complex set of relationships needed to achieve and sustain implementation and impact, including the vital role of government and community engagement at every level. Even with our work in the United States, we quickly ran into setbacks after our first major education effort to build smaller schools did not show the results initial pilots had promised.

In the words of Graça Machel, a long-time champion of health and development in Africa and a foundation partner, we needed to get much better at “listening with respect” to other points of view in the countries and communities where our work was focused.

While the foundation was doing great work, to achieve our mission we needed to evolve. To my pleasant surprise, I found that Bill, Melinda, and other leaders were more than prepared to engage and experiment. While initially unsure that the foundation could add meaningful direct value in beneficiary countries rather than working through large intermediaries, we started to test some grants. My first big one was a $40 million initiative to support the growth of independent development policy think tanks in countries across Africa, Asia, and Latin America. Other teams started to trial and expand similar work, from new agricultural initiatives in India and Ethiopia to tobacco prevention programs in Southeast Asia and West Africa.

Once Bill formally left Microsoft in 2008 and Melinda’s time freed up as well, they both started traveling more extensively to countries where our work was focused. This allowed them to get deeper exposure to the work and to meet and learn from local leaders.

Soon after, they asked me to take on an expanded role to turn our HIV prevention programs in China and India into full-fledged offices that dealt with a range of issues and to explore establishing a presence in Africa. Those initial steps led to establishing offices in Abuja, Addis Ababa, and Johannesburg in addition to Beijing and Delhi. In all, we have more than 230 employees outside of the United States, the majority of whom are nationals of their respective regions.

Meanwhile, we were steadily becoming more aligned with the MDGs, deepening our traditional set of partnerships both with US, European and Japanese aid agencies and multilaterals like the World Bank, World Health Organization, and Food and Agriculture Organization. Often in partnership, we also became more intentional about ensuring our grants support people and institutions closer to affected communities. While most of these were in the service delivery and advocacy space, this also included research and development, one of our largest areas of investment.

For example, we launched our Grand Challenges program in 2003 to incentivize work on 14 major scientific challenges that, if solved, could significantly reduce global health inequity.

Initially, we made a series of very large grants that went almost exclusively to established institutions in high-income countries. To broaden that, we launched a new program called Grand Challenges Explorations in 2008 that conducted more intentional outreach to low- and middle-income countries. We also launched funding partnerships with USAID and Canada, and regional initiatives in Africa, China, and India. Today, most of our Grand Challenges funding goes to researchers in low- and middle- income countries.

Of course, there needs to be a balance. Even as we steadily increase investments in low- and middle-income countries via universities, companies, and research networks, the fact remains that a significant proportion of global technical expertise and capacity remains in the Global North and, thus, so does much of our grantmaking. However, we are fully committed to getting smarter and more systematic about making sure that resources intended to benefit lower-income countries work to strengthen regional and domestic capacity to drive and sustain that impact.

While diversifying and strengthening our partnerships is one important step to increasing our impact, we also need to sharpen our view as to where and how we can add the most value. What is the distinctive role of philanthropic capital compared to private or public capital in addressing challenges like health and education?

When I took on the role of chief strategy officer in 2016, this was the core question Bill and Melinda wanted me to consider. To answer it, we developed a new strategy framework that set out how—relative to government—we can move more quickly and take more risks in helping develop evidence-based approaches that can then be deployed at scale. Similarly, it outlined ways we can better harness the innovation and delivery expertise in the private sector to help address the needs of the poorest.

In practice our role is different depending on where we might have comparative advantages. Our internal strategy unit works with each of our program teams to map out the external partner landscape, existing expertise, and key areas of need and opportunity to develop customized strategies that are subject to rigorous annual review.

The way we have sought to respond to the COVID crisis is a good example. The more than $2 billion we have committed represents only a tiny fraction of what has been pledged by governments and the private sector. Our aim is to be complementary and additive wherever possible. Above all, we have focused our resources on making sure support reaches marginalized communities as quickly and effectively as possible.

In February 2020, before even a single case of COVID had been identified outside of China, the epidemiologists working at the foundation understood it would explode into a pandemic. Aware that only two African countries had the tools to test for the disease at the time, we made the first of several COVID-related grants to the Africa Centers for Disease Control and Prevention to boost capacity across the continent.

A key asset has been our ability to leverage our deep knowledge and extensive partnerships in research and development from our work in other infectious diseases like HIV, malaria, polio, and TB. We funded projects supporting the development of new diagnostic tools, treatments, and vaccines while using equity capital and financial guarantees to incentivize at-risk manufacturing at scale ahead of regulatory approval.

COVID-19

Perspectives on the global response to the novel coronavirus

We drew on existing investments in cutting-edge disease modeling to help inform decision-making by policymakers. We co-founded and helped fund COVAX to provide global equitable access to COVID vaccines. At the same time, we provided technical and financial support to regional efforts, including African Union-led vaccine and medical supplies purchasing programs and the genomic sequencing networks in Southern Africa that detected both the Beta and Omicron variants. We supported a wide range of governmental partners from Nigeria to Bangladesh in efforts such as providing oxygen to ill patients and combating vaccine hesitancy.

In each case, our financial resources were supplemented by direct technical and strategic advice and partnership via our employees. Now more than 1,700 strong and recruited from government, private industry, multilateral agencies, academia, and many other areas, our people bring both a deep knowledge and a wide set of personal and professional relationships. This has allowed us to be much more systematic in sharing expertise with partners who ultimately make and implement decisions.

COVID has had devastating direct and indirect impacts on the communities we are most focused on, and it will take many years for them to recover. Yet there are silver linings. We think we have the potential to dramatically accelerate impact in some areas by using tools that have been developed during the pandemic, from linked digital diagnostic tests to low-cost drug manufacturing techniques. Most notably, mRNA vaccines—a technology we first invested in five years ago—have the potential to transform the way we prevent other diseases like HIV and malaria.

Last year, boosted by the additional commitments for COVID response, we paid out $6.7 billion. This doesn’t include hundreds of millions more in guarantees, forgivable loans, and other financing from our Strategic Investment Fund, which supports efforts like at-risk manufacturing of COVID vaccines. Since our founding 21 years ago, we have paid out more than $60 billion in grants. Every year for the past decade our payout has grown.

With a more than $50 billion endowment, Bill and Melinda’s generous additional commitment of $15 billion last year, the expectation of future pledges, and the requirement to spend down our endowment after our co-founders’ deaths, we are uniquely positioned to maintain a major role in the field of philanthropy for decades to come.

The scale of our giving must be matched by a deep sense of responsibility in how we distribute it, making sure those resources are stewarded and deployed as effectively as possible. That means staying focused on what matters—not the money out the door but the impact, which we measure in lives saved and opportunities provided for the poorest and most marginalized to achieve their full potential.

It also requires a clear and unambiguous commitment to diversity, equity, and inclusion.

The journey the foundation has been on to diversify our own staff and investments is central to that commitment. Over the past two years, we have undertaken a systematic review of our work in this area, including drawing on surveys of employees, alumni, and partners that have both called out shortcomings and identified positive exemplars. As a result, we have now adopted a public DEI commitment statement and put in place a series of concrete plans to enhance our impact internally and externally. I know we still have a long way to go, but I am confident that we are more thoughtful and intentional about continuing to improve.

When I was first appointed CEO, I flew to Omaha to have lunch with Warren. Among the many thoughtful pieces of advice he gave me was to remember my ABCs. This was Warren’s way of telling me to watch out for three perennial threats that all large organizations face: arrogance, bureaucracy, and complacency.

In a context where partners and grantees are rarely incentivized to give critical feedback, it is all too easy for a mission-driven foundation like ours to inadvertently create a self-reinforcing echo chamber that rationalizes our failures and oversells our successes. That in turn contributes to suspicion about the role of philanthropy and whether it really does make a difference.

There is no simple solution to avoiding these pitfalls. It requires constant scrutiny—actively seeking out and being open to constructive criticism from diverse voices, transparently using our internal and external review processes to ruthlessly prioritize areas where our potential impact is greatest, resisting mission creep, and staying focused.

One of the great personal virtues of Bill and Melinda—and one of the key reasons I have devoted the bulk of my career to the Gates Foundation—is their willingness to change their minds. This is particularly true when compelling evidence reveals the potential for more effective ways to save and improve lives through our work. When we take risky bets, it is inevitable that some will fail. But rather than become more conservative, Bill and Melinda have chosen to fail fast, learn, and improve. From gender equality to K-12 education to climate adaptation investments as part of our agricultural development program, they have time and again approved new approaches and deprioritized older ones based on evidence. They and I will be actively looking to our new board members to help us be even more rigorous and focused so we can meet our mission and avoid the pitfalls Warren outlines.

As I begin my 16^th year as an employee, my third as CEO, and my first as a board member, I am more convinced than ever that the Bill & Melinda Gates Foundation has a unique role to play in helping create a better, fairer world. I further believe the expertise and credibility we have built over the past two decades—combined with the amazing commitment of our founders and co-chairs, the passion of our employees, and the support of our partners—mean that despite the challenges, our best days lie ahead of us. I look forward to reporting back in years to come on how we are doing.

Mark Suzman
Chief Executive Officer
Bill & Melinda Gates Foundation

January 26, 2022