Great Expectations: Meeting Clients’ Philanthropy Needs

Meg Lassar Strategic Philanthropy Analyst 6 June 2011


Research from the Rafferty Consulting Group reveals 79 per cent of HNW investors are dissatisfied with the guidance thwy receive on philanthropy. Here Meg Lassar, an analyst with Strategic Philanthropy, provides advice and resources for advisors.

According to research by the Rafferty Consulting Group, 79 per cent of HNW investors are dissatisfied with the guidance they receive from their advisors about philanthropy.

Why are wealth advisors falling short of clients’ expectations when it comes to charitable planning?

Firstly, many advisors lack the training and education necessary to knowledgably discuss philanthropy with their clients. Others may not feel comfortable engaging in deeply personal conversations with their clients about values, family involvement and legacy—necessary topics to explore when assisting clients’ in developing an effective philanthropic plan. Finally, charitable planning can be a complex process involving the navigation of tedious tax law, managing family conflict and aligning investment and spending policies with clients’ charitable missions.

However, when advisors are equipped with the tools they need to engage clients in a meaningful charitable planning process, they develop comprehensive wealth management plans that are aligned with their clients’ overall values and priorities, resulting in deeper client relationships and the ability to differentiate their services from those of their competitors.  

The first step is to get comfortable with initiating the charitable planning conversation. Integrating key questions into client intake surveys and annual reviews can help advisors to begin talking about philanthropy in a way that respects clients’ privacy, values, and autonomy. Guiding questions such as “what motivates your charitable giving activities?” and “what does successful philanthropy look like to you?” help advisors to better understand clients’ philanthropic goals, the kind of legacy they hope to leave, who to involve in the charitable planning processes, the amount they’re willing to devote to philanthropy, and how they envision implementing their charitable activities.

Once advisors have gleaned this information, they need access to the tools and information that will enable them to put their clients’ plans into action. Below are a few of the resources featured in the Charitable Planning Desk Reference for Advisors (click here). Developed by a team of philanthropic, legal and wealth advisors, the Desk Reference arms advisors with the knowledge they need to effectively work with clients around the planning and implementation of their philanthropic goals.

The charitable planning checklist

Charitable planning is a multifaceted process involving several key players (see "The client-centered team” below).  A comprehensive “to do” checklist will ensure that advisors cover all of the most important, and some of the most frequently overlooked, aspects of the charitable planning process and will tell them which professionals should be included at each stage. The checklist also lets advisors know which philanthropic “best practices” they should encourage their clients to adopt - from issuing grant award letters to evaluating the impact of their charitable gifts.

The client-centered team

Advisors with particular areas of expertise can grow accustomed to working only within their specific practice areas. However, effective charitable planning requires a diverse set of private client advisors – from estate planning attorneys to wealth managers to accounts – who collaborate as part of a client-centered team.

This team is not complete without the expertise of a philanthropic advisor – a professional with specialized knowledge of the non-profit sector who works with colleague advisors to navigate the philanthropic landscape. A philanthropic advisor helps clients to apply the same creative and strategic thinking they use in business and financial management to their charitable giving.

By assembling this team of professionals, advisors surround themselves with the strategic and professional support they need to successfully manage clients’ philanthropic investment portfolios.

Comparative information on charitable giving vehicles

Often, advisors fall into the pattern of recommending those giving vehicles with which they have the most experience. Yet different types of donors are best served by different types of giving vehicles. A chart that outlines the benefits and limitations of all the vehicle options can help advisors discuss and ultimately recommend the vehicle most suited to their clients’ needs.

Outline of financial/estate/tax planning considerations for non-cash asset contributions

By donating non-cash assets such as appreciated securities, artwork or real estate, clients can support the causes they care about while preserving cash and generating income tax benefits. However, donating illiquid assets takes a bit more planning than traditional cash giving. It is therefore paramount that advisors are well versed in the benefits, limitations and processes associated with gifting these types of assets.

Next generation tip sheet

Multigenerational discussions about charitable giving plans can go a long way towards ensuring the successful transfer of wealth and the continuity of a family’s values. A recent survey of multi-family offices by New Philanthropy Capital found that 85 per cent of families with children involve them in philanthropy, and 60 per cent of these families would find professional philanthropy advice useful in doing so.

Engaging the next generation in charitable and overall wealth planning discussions is, therefore, a prudent business decision. The “next generation tip sheet” outlines ideas for trustee training and education and recommends ways to mitigate intergenerational conflict.

Legal fundamentals of international giving

In our increasingly globalized and connected world, donors feel closer to the struggles faced by people around the globe – from natural disasters of growing intensity to humanitarian crises. As a result, cross-border giving is on the rise. For example, international giving by US-based foundations has more than tripled over the last decade, from $2.0 billion in 2000 to $6.7 billion in 2009. 

Facilitating direct cross border giving comes with its fair share of paperwork, but with a guide outlining the legal fundamentals – and a trusted attorney with expertise on the issue – advisors can help clients to realize their global giving goals.

Due diligence checklist

Arming clients with a guide to conducting due diligence on non-profit organizations will allow them to feel confident that they are funding organizations that are effectively governed, transparent and accountable, fiscally responsible and aligned with their core values. Prudent due diligence is especially important as the non-profit sector grapples with economic fallout, state government funding cuts and the stain of recent high-profile scandals.

Philanthropy resources for clients

There are myriad networks, membership groups and associations that you can introduce to your clients in order to enrich their philanthropic experiences. Here are a few examples:

Regional Associations of Grantmakers (RAGs) bring donors together for networking and educational purposes with the goal of improving the quality of life in a particular region. These associations host workshops and seminars where donors have the opportunity to learn from leaders in particular fields and network with peer funders.  Find out if there is a RAG near you by visiting

Peer Funding Networks offer donors with common interests the opportunity to fund projects together and to learn about grant-making best practices or more about a particular social issue such as food security, early childhood education, or poverty. For example, Grantmakers Without Borders is a network of public and private foundations as well as individual donors who practice global social change philanthropy while the Environmental Grantmakers Association promotes effective environmental philanthropy.

National associations such as the National Center for Family Philanthropy and the Association of Small Foundations provide donors and their advisors access to the most up-to-date information on philanthropic best practices. Their webinars and conferences allow donors to share their funding experiences with one another and to learn about the most recent trends in philanthropy. They also publish useful resource guides on wide-ranging issues from foundation governance to raising philanthropic children.

Incorporating philanthropy into your advisory practice is not just a “do good” philosophy, it also happens to be good for business. By integrating clients’ philanthropic practices into their broader wealth management strategies, you can further solidify relationships with clients, thereby increasing the potential for new referrals and opening the door to new clients seeking guidance on how to realize their philanthropic goals.

Meg Lassar is an analyst with Strategic Philanthropy, a philanthropic advisory practice based in Chicago serving clients worldwide. The firm works with individuals, families, closely held and family-owned businesses, helping them plan, assess and manage their charitable giving.


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