Private Foundations’ Conflicts of Interest Revealed

Global Health Philanthropy and Institutional Relationships: How Should Conflicts of Interest Be Addressed?  by David Stuckler, Sanjay Basu, and Martin McKee, is a groundbreaking article in PLoS Medicine, illuminating the shadows behind which major conflicts of interest in public health policy lurk.

The authors identify and examine the scope of the intricate relationships between private tax-exempt foundations that are major funders of global health, and commercial  corporations. 

The authors use the World Health Organization definition of conflicts of interest:

A conflict of interest “can occur when a partner’s ability to exercise judgment in one role is impaired by his or her obligations in another role or by the existence of competing interests. Such situations create a risk of a tendency towards bias in favor of one interest over another or that the individual would not fulfill his or her duties impartially and in the best interest of the RBM Partnership.

 A conflict of interest may exist even if no unethical or improper act results from it. It can create an appearance of impropriety that can undermine confidence in the individual, his/her constituency or organization. Both actual and perceived conflicts of interest can undermine the reputation and work of the Partnership.”

The article lifts the veil that hides the direct and, more importantly, the indirect financial conflicts of interest  that exist within private foundations. By "following the money," the authors found that "despite the existence of policies explicitly designed to mitigate potential conflicts of interest, the boundaries between foundations, their investments, and their parent corporations or private funders can become blurred. Often, directors of the boards of foundations also sit on the board of private corporations, adopting multiple roles."

The authors  conducted a case study using data about the networks, activities, and funding patterns of the Bill & Melinda Gates Foundation, Ford Foundation, W. K. Kellogg Foundation, Robert Wood Johnson Foundation, and Rockefeller Foundation.

These are the largest private global health foundations that exert inordinate influence on public health policy–those policies favor Big Pharma and their own corporate and endowment portfolios.

The answers to the following questions revealed an intricate web of hidden interconnected financial ties that influence the foundation’s agenda and funding decisions:

(i) Where does money come from and with what conditions?

""The Bill & Melinda Gates Foundation’s corporate stock endowment is heavily invested in food and pharmaceutical companies, directly and indirectly. The Foundation holds significant shares in McDonald’s and Coca-Cola and Berkshire Hathaway. In 2009 the Bill & Melinda Gates Foundation sold extensive pharmaceutical holdings in Johnson & Johnson, Schering-Plough Corporation, Eli Lilly, Merck, and Wyeth…Berkshire Hathaway also has significant ownership in GlaxoSmithKline, Sanofi-Aventis, Johnson & Johnson, and Procter & Gamble, and is one of the main global investors in the latter two pharmaceutical companies."

"At the end of 2008, the Bill & Melinda Gates Foundation Trust had US$29.6 billion assets under its management: $13.5 billion were in corporate stock, $1.8 billion in corporate bonds, $6.1 billion in US and state government obligations, and $8.2 billion in other investments, land, and temporary holdings.

(ii) Who decides? Who sits on the board of directors, and what are their histories, relationships, and interests?

"The Bill & Melinda Gates Foundation’s management committee oversees all the Foundation’s efforts (analogous to a board of directors). The management committee comprises three co-chairs (Bill Gates, Melinda Gates, and William Gates Sr.); three trustees (Bill and Melinda Gates and Warren Buffett)…Several of the Foundation’s members of the management committee, leadership teams, affiliates, and major funders are currently or were previously members of the boards or executive branches of several major food and pharmaceutical companies."

(iii) Who benefits from these decisions? Where are these funds distributed and which entities derive income from that expenditure?

"The majority of the Foundation’s grants are directed to researchers in the US. Of US$9 billion in financial transactions that went toward 1,094 global health programs between 1998 and 2007, about half went to recipients in the US and 40% to supranational organisations; overall, about 42% of all funding was spent on health care delivery or increasing access to drugs, vaccines, and medical commodities, while an additional one-third was allocated to technology development (mainly for vaccines and microbicides) or basic science research."

"many of the Foundation’s pharmaceutical development grants may benefit leading pharmaceutical companies such as Merck and GlaxoSmithKline, for example via partnerships to test pneumonia and rotavirus vaccines (such as the ROTATEQ partnership and the Merck Vaccines network partnership with the Global Alliance for Vaccines and Immunizations network), experimental malaria vaccines (through Medicines for Malaria Venture, an NGO), cervical cancer vaccines (through PATH, an NGO, and Merck’s vaccine Gardasil), and HIV interventions (through the Africa Comprehensive HIV/AIDS partnership). Johnson & Johnson has entered a clinical partnership to develop new HIV-prevention technology, noting “the work between Johnson & Johnson and the Gates Foundation is a strong, strategic, comprehensive relationship” 

See, the web of financial ties that behind the scene, set the Gates Foundation agenda.

The unmasking of pivotal conflicts of interest in the public health sector is an important contribution that should lead to a public debate and a  re-examination of public health policies and the allocation of  taxpayer money to implement those policies. 

Stay tuned for a follow-up about a controversy revolving around Gates Foundation-supported project– Advance Market Commitment (AMC)– a market expansion strategy for increasing profits for vaccine manufacturers masquerading as an innovative method for developing vaccines for neglected disease to save the lives of millions of poor children. 

  Vera Hassner Sharav


PLoS Medicine

Global Health Philanthropy and Institutional Relationships: How Should Conflicts of Interest Be Addressed?


  • Institutional relationships in global health are a growing area of study, but few if any previous analyses have examined private foundations.
  • Tax-exempt private foundations and for-profit corporations have increasingly engaged in relationships that can influence global health.
  • Using a case study of five of the largest private global health foundations, we identify the scope of relationships between tax-exempt foundations and for-profit corporations.
  • Many public health foundations have associations with private food and pharmaceutical corporations. In some instances, these corporations directly benefit from foundation grants, and foundations in turn are invested in the corporations to which they award these grants.
  • Personnel move between food and drug industries and public health foundations. Foundation board members and decision-makers also sit on the boards of some for-profit corporations benefitting from their grants.
  • While private foundations adopt standard disclosure protocols for employees to mitigate potential conflicts of interests, these do not always apply to the overall endowment investments of the foundations or to board membership appointments. The extent and range of relationships between tax-exempt foundations and for-profit corporations suggest that transparency or grant-making recusal of employees alone may not be preventing potential conflicts of interests between global health programs and their financing.