NEW YORK: Google Inc, not content with successfully making the Internet a more useful information hub, has set an even loftier goal for itself: to create a foundation to tackle “the largest problems of the world”.
With a thriving enterprise driving such altruism, Google could become one of the big-time do-gooders in the world of corporate philanthropy.
But unlike the Rockefellers, Fords, Carnegies and others who first exploited industrial upheaval with new products and services, then turned to giving, Google is starting out with different corporate ethos – captured in its “don't be evil” mantra.
Yet, for now, the specific aims of the foundation are unclear.
Belying Google's grand intentions, the item is given a scant, two-sentence mention in the massive document filed with regulators to introduce the public to many undisclosed details about the six-year-old company.
Google said on Thursday it plans to sell US$2.7bil (RM10.3bil) of stock in an IPO.
Under the heading “Making the World a Better Place”, Google informed potential investors that “we intend to contribute significant resources to the foundation, including employee time and approximately 1% of Google's equity and profits in some form.”
“We hope someday this institution may eclipse Google itself in terms of overall world impact by ambitiously applying innovation and significant resources to the largest of the world's problems,” company founders Larry Page and Sergey Brin wrote in the document filed with the US Securities and Exchange Commission.
According to Loren Renz, director research at the Foundation Centre, creation of a foundation allows for more long-term consistency in awarding grants and allows a corporation to shelter some assets.
“It allows you to put money into the foundation that is sheltered, but you must pay out 5% of the average, rolling value of the asset over the next 12 months,” Renz said.
Of the nearly 65,000 US foundations, about 2,400 are corporate foundations, she said, citing 2002 data.
A foundation would add another level of public disclosure to Google, which for the last six years has enjoyed the relative secrecy of a privately-held corporation.
“It is more onerous to have a foundation than just having a corporate-giving programme,” she said, noting that foundation “tax returns are public record.”
“Every contribution that you make must be accounted for on the tax forms in an attachment – who you are giving the gift to and the amount of the gift,” she said.
Google earned nearly US$106mil (RM402.8mil) last year, up from US$100mil (RM380mil) in 2002. For the three months ended March 31, Google earned US$64mil (RM243.2mil) on revenue of about US$390mil (RM1.48bil), 30% of which was derived from outside the United States.
Steve Rochlin, director of research and policy development at the Centre for Corporate Citizenship at Boston College, said the advent of business globalisation in the 1980s gave rise to the modern form of corporate foundation.
“You had a situation where global competition was intensifying, and it became problematic for the CEO and top management to control corporate giving,” he said. – Reuters
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