Philanthropy, in simplistic terms, is often manifested as the flow of funds from a grant-maker to a beneficiary, and as such can be considered one-directional. Yet so many people who do this (whether they are giving of their time, talent or treasure) have expressed the rewarding feeling of giving. I can attest to this personally, particularly in respect of several non-profit board and committee positions.
Family philanthropy, when done well, can be “win-win”. It can deliver immense value to the family.
Like many things, doing it well means doing it with a plan. For a family, that means asking “why should we give?”, “what are our (collective) values?”, “what impact do we want to leave on the world?” and other such questions. These questions don’t have simple answers, and just discussing them as a group can be an enlightening and bonding experience for the family.
While asking these questions can lead to better quality and more strategic philanthropy, they have the additional benefit to the family in providing a focal point to broader family questions such as “what does it mean to be wealthy?” and “what does my life mean given I never need to work?”. It can also be a great way to engage younger and rising generation family members who may not want (nor may be ready) to discuss financial matters.
In some families, philanthropy can be a source of conflict, of competing interests and ego. It doesn’t have to be, provided the family is prepared to put in the effort to do it well. It can be win-win for both the beneficiaries of their generosity and the family.
Consider This: What discussions have your family had about philanthropy? Have those discussions been helpful? Who is involved in vision and strategy? To what extent are the rising generation involved?
Further reading:
- Happy Families: The unifying force of philanthropy
- Why family philanthropy isn’t just about writing a check
- Increasing wealth drives family office focus on philanthropy and succession plans
- Evolving Family Models Alter the Ways a New Generation Gives Back
- Strategy, Structure, Shared Purpose: There are Rules to Protecting Family Wealth
- Want to Serve Ultrawealthy Clients? Learn How to Run a Successful Family Meeting.
Here is more on reading on family wealth transition.
