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Azim Premji, the odd man out in India’s thrifty billionaires club
Azim Premji, chairman of India’s leading IT software company Wipro Ltd, is the odd man out among his peers when it comes to philanthropy.
Premji recently announced that all earnings from approximately 34% shares of India’s fourth-largest software services exporter — worth about Rs 52,750 crore ($7.5 billion) — would be transferred to the endowment that supports the Azim Premji Foundation. With this, Premji has committed earnings from 67% of Wipro’s shares to the charitable foundation. The Premji family and entities controlled by them hold a 74.30% stake in the software exporter.
However, Premji’s peers are not as generous as him. The Indian Philanthropy Report released last week by Bain & Company estimated that excluding contributions by Premji, donations of Rs 10 crore and above have declined 4% in India since 2014 even as the proportion of the ultra-rich — those with a net worth of over $50 million — grew by 12%.
“A breakdown of contributions reveals that while large donations (INR 10 crore or more) by UHNIs (ultra high net worth individuals) compose 55% of individual philanthropist funding, about 80% of this figure results from Azim Premji’s donations to his philanthropic organisation, APPI. Take out that contribution across the years, and the segment has seen a 4% decrease (see Figure 10). This is particularly problematic, given that UHNI households have grown at a rate of 12% over the past five years and are expected to double in both volume and wealth from 1,60,600 households with INR 1,53,000 crore combined net worth in 2017 to 3,30,400 households with INR 3,52,000 crore combined net worth in 2022,” says the Bain report.
“A benchmarking exercise of weighted average participation (the percentage of net worth contributed per year) compared with the US suggests an additional strategic giving potential of INR 40,000 to 60,000 crore from large UHNI donors alone. This increase, when compared with their current contribution of an estimated INR 23,000 crore, indicates a potential increase of 2.5 to 3.5 times the current level of giving,” the report says.