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Philanthropy In Testing Times: A Transatlantic Perspective

Tom Burroughes

20 January 2024

The role of philanthropy advisors is becoming more demanding, especially when arguments erupt about purpose and values. At the same time, the sector isn’t always appreciated for its ability to innovate more nimbly than governments. 

These are some of the observations from senior figures in the philanthropy advisory space in the US and Europe who spoke to this news service about the kind of year they’ve been through. 

A broad takeaway is that philanthropy isn’t just a “nice-to-have” non-core wealth management offering. The values and ambitions of clients, and those of family members, often come to light most vividly when charity is on the table.

Philanthropy can be controversial, and managing disputes among founders and families is part of the mix. Disputes about how heirs to philanthropists can fall out over purpose creates the need to find ways of preventing conflict, and keep philanthropy fresh, Sarah Salomon, head of family advisory and philanthropy, Americas, which intends to sunset in 25 years, she continued.

Sunset clauses aren’t cure-alls but they can mitigate difficulties over time. To give an example of disputes that arise, in late August 2022 a story broke about how two daughters of the late Hollywood movie star, Paul Newman, had sued the Newman’s Own Foundation he had created, saying that its leaders had moved from the actor’s wishes and limited their involvement in its charitable giving. The charity was created in 2005, three years before the actor died. The non-profit controls a food company called Newman’s Own that funds the private foundation with its after-tax profits.

In another case (2018), at the University of Chicago, a $100 million charitable bequest to finance conflict-resolution research via the university turned into a row. 

(On a related front, this news service has opened nominations for the third annual Wealth For Good Awards 2024.)

Inflection point
Philanthropy is changing and conversations with clients must be handled sensitively, Juliet Agnew, head of philanthropy at , a US-headquartered advisor that helps families frame conversations on important topics. 

“While most HNW families are very generous and want to give back (90 per cent of HNW investors give to charity), giving away money is more difficult than it appears. To whom do you donate? How much? Is it a one-time gift or multi-year? How do you evaluate success? These are shrewd businesspeople who have been successful in their pursuits, but measuring success in philanthropy can be very different,” Bell said. “As an example, Warren Buffet has chosen to give over $36 billion to the Gates Foundation rather than give it away himself because he thinks they are better suited to make the most of the money.”

Gates Foundation
After several references to the Gates Foundation, it is natural to ask it directly about its philanthropy focus. And health and wellbeing appear to be dominant themes.

A real benefit of philanthropy is the first-mover advantage. Philanthropists can enter areas and start conversations that governments, under political constraints, can find harder to do, at least initially, Jennifer Alcorn, deputy director on the foundation’s philanthropic partnerships team, told this news service. Alcorn also leads Gates Philanthropy Partners (GPP), an independent 501c3 charity.

“I have seen an incredible increase in philanthropic giving for global issues and that wasn’t quite there before. There are ups and downs ,” Alcorn said. 

This point about the philanthropist as an innovator isn’t a new one, but bears repeating. A recent book, Advising Philanthropists: Principles and Practice, by Emma Beeston and Dr Beth Breeze, spells out some criticisms of philanthropy and defences of the space, such as how charities can go into difficult areas that governments, for understandable political reasons, might not want to enter. (This news service has written editorial about the issues here.)

“We believe that philanthropy has a very important role in society – and we want to encourage more and better philanthropy,” Barclays’ Agnew said. “It has a particular role to play because of the way it can work. Philanthropy can do certain things that the public sector can’t easily do, such as flow quickly to areas that are underfunded, neglected, too high risk to attract investor or government capital, and help to build the strength of organisations or sectors that need investment over very long time frames.”

Many causes 
Philanthropists haven’t lacked for causes, whether it be helping young people raise education standards after the disruptions caused by the pandemic; mental health, natural and human-caused woes such as earthquakes, wars and civil strife. 

Generosity endures. To take the US, a study from ,” she said.