I agree that there are serious problem with niche-specific professional advisors (i.e. estate planning attorneys, commission-based financial planners, certainly planned giving officers, etc.) offering philanthropy-related counsel. I don’t agree, however, with the implication that the entire problem is the result of self-interest on the advisor’s part. Often it is benevolent ignorance—they don’t know what they don’t know. Sometimes it is a pushy client who walks in insisting on the vehicle they want. Usually, the issue of changemaking—philanthropic objective—doesn’t even come up.
There is one professional group, however, that is working to address these problems ... The International Association of Advisors in Philanthropy. The name would fool anyone involved in professional philanthropy as the members are all financial planning professionals who are committed to learning about the full spectrum of the tax and financial issues related to various giving options, and are equally committed to raising the topic of philanthropy with every client. They are only now starting to turn their attention to understanding the strategic issues of making change in the community and world, and are starting to scratch the surface of understanding how charity—and charities—work to make change. They deserve our support and applause.
The flip side of this problem is the disdain or benevolent ignorance of professionals in the philanthropic sector about the complexities of advanced financial, legal, tax, and inheritance planning. Having worked toward bridging the gap between our two industries—philanthropy and planning—I can tell you that the disdain is unwarranted and benevolent ignorance—on both our parts—is fixable. But only if both sides stop viewing the other as adversaries in the battle over client control.
Lastly, let’s not give donors too much credit when it comes to “know[ing] how they think change happens.” Lots of people with the assets and intelligence to know they need a professional financial or legal advisor have never even thought about making change in the world, much less developed a model for how they think it happens. Many of my clients over the years have never given philanthropy a thought until their advisor brought it up—usually for tax planning purposes.
“Philanthropic capital markets” are interesting philosophical and academic constructs—but I think we’ll get much further in achieving basic social change if we focus on donor education and advisor education.
Renata, great to hear about what the International Association of Philanthropic Advisors is doing (and great to connect again, virtually). I agree that many donors may not have thought deeply about how they think change happens, or even that they want to make change. But I think there are many who do think about how to create change, and if I had to bet, I think the trend is that their numbers will continue to increase.
I also agree that education is important for both donors and advisors. But I think there is something further than education that is needed on both ends. Philanthropic advisors may know all the ins and outs of arcane tax laws and financial tools, and they may well know how donors can fund advocacy or social change work, but they also need to see that offering donors advice on change – more particularly, raising the issue first – is something that is in their donors’ best interests, and theirs. The community foundation world, for example, has struggled with the question of how best to attract donors: whether they should emphasize donor services, or emphasize the kind of change they seek (and here let’s assume they are not primarily concerned with their self-interest, but with what they think will bring the most resources to bear for the communities they serve). To my mind, Emmett Carson’s argument on this is persuasive, that community foundations that make clear what change they seek, what they stand for, will on balance attract many more donors than they turn off. (See, e.g., http://www.ospreycommunityfoundation.ca/docs/carson.pdf). (My apologies to Lucy and all for the cross-posting on this point here and at Philanthropy 2173).
If you ask someone, “how does change happen?” I would guess very few people could answer the question.
But when you ask them what they want to see different in the future, what works now and doesn’t, what they care about and why, what they want for their grandkids, what helped them to succeed or made a difference in their lives, etc. etc. - well, I’ve never met anyone who couldn’t answer those questions.
Whether or not they want change or status quo, are Milton Friedman acolytes or believe in a more robust social safety net, are absolutely committed to social justice or tend to think trial lawyers are all bad guys - people know what they care about. Within the answers to those questions is the answer to how they think change happens. And, within the answer to that, is the discussion that advisers should initiate with donors and donors should initiate with advisers - what are my options? how do they compare to each other? what is good for what? How do the many variables - change strategy, tax incentives, family concerns, costs, visibility, control - how do they complement or count each other out.
Donors will need - and are using - portfolios of giving products to meet their multiple needs. This is where the fun, the potential, and the multi-variate equations for being a good adviser comes into play.
Yes, its wonderful that more financial advisors are learning about philanthropy. I hope the trend goes the other way as well.
The problem for me is 2 fold ( well it is multi but 2 main ones)
Political correctness
Society owes me
Political correctness - Any authority is extremely aware of make a judgment or decision for fear of ostracising a minority or be accused of favouring a majority – I do not envy them in their roles. Clear guidelines need to be set - this is the way it will be – and if it doesn’t suit find somewhere that does. I live in the Netherlands and there is no more PC country in the world - rules for rules sake so I am well versed in this type of environment.
Society owes me - society owes you nothing ! If you want it, get up and get it. To many people and that can be from the same sector of people as well as natives expect , homes, money, education , places of worship. I would remind them of the GOYA principle
Get Off You’re A….. .
I am not implying some extreme dictatorship – but common sense must prevail at some point
So all in all with these 2 points considered it make decision making – a nightmare. Will it ever come good – I hope so – for all our sakes.
I agree that places like the International Association of Philanthropic Advisors is what donors should use when giving. Its not enough to just give it is the donors responsibility to make sure the money ends up in the right hands.
COMMENTS
BY Renata Rafferty, Author "Don't Just Give It Away:
ON September 27, 2007 11:34 AM
I agree that there are serious problem with niche-specific professional advisors (i.e. estate planning attorneys, commission-based financial planners, certainly planned giving officers, etc.) offering philanthropy-related counsel. I don’t agree, however, with the implication that the entire problem is the result of self-interest on the advisor’s part. Often it is benevolent ignorance—they don’t know what they don’t know. Sometimes it is a pushy client who walks in insisting on the vehicle they want. Usually, the issue of changemaking—philanthropic objective—doesn’t even come up.
There is one professional group, however, that is working to address these problems ... The International Association of Advisors in Philanthropy. The name would fool anyone involved in professional philanthropy as the members are all financial planning professionals who are committed to learning about the full spectrum of the tax and financial issues related to various giving options, and are equally committed to raising the topic of philanthropy with every client. They are only now starting to turn their attention to understanding the strategic issues of making change in the community and world, and are starting to scratch the surface of understanding how charity—and charities—work to make change. They deserve our support and applause.
The flip side of this problem is the disdain or benevolent ignorance of professionals in the philanthropic sector about the complexities of advanced financial, legal, tax, and inheritance planning. Having worked toward bridging the gap between our two industries—philanthropy and planning—I can tell you that the disdain is unwarranted and benevolent ignorance—on both our parts—is fixable. But only if both sides stop viewing the other as adversaries in the battle over client control.
Lastly, let’s not give donors too much credit when it comes to “know[ing] how they think change happens.” Lots of people with the assets and intelligence to know they need a professional financial or legal advisor have never even thought about making change in the world, much less developed a model for how they think it happens. Many of my clients over the years have never given philanthropy a thought until their advisor brought it up—usually for tax planning purposes.
“Philanthropic capital markets” are interesting philosophical and academic constructs—but I think we’ll get much further in achieving basic social change if we focus on donor education and advisor education.
BY Pete Manzo
ON September 27, 2007 11:21 PM
Renata, great to hear about what the International Association of Philanthropic Advisors is doing (and great to connect again, virtually). I agree that many donors may not have thought deeply about how they think change happens, or even that they want to make change. But I think there are many who do think about how to create change, and if I had to bet, I think the trend is that their numbers will continue to increase.
I also agree that education is important for both donors and advisors. But I think there is something further than education that is needed on both ends. Philanthropic advisors may know all the ins and outs of arcane tax laws and financial tools, and they may well know how donors can fund advocacy or social change work, but they also need to see that offering donors advice on change – more particularly, raising the issue first – is something that is in their donors’ best interests, and theirs. The community foundation world, for example, has struggled with the question of how best to attract donors: whether they should emphasize donor services, or emphasize the kind of change they seek (and here let’s assume they are not primarily concerned with their self-interest, but with what they think will bring the most resources to bear for the communities they serve). To my mind, Emmett Carson’s argument on this is persuasive, that community foundations that make clear what change they seek, what they stand for, will on balance attract many more donors than they turn off. (See, e.g., http://www.ospreycommunityfoundation.ca/docs/carson.pdf). (My apologies to Lucy and all for the cross-posting on this point here and at Philanthropy 2173).
BY Lucy Bernholz
ON September 28, 2007 06:38 PM
If you ask someone, “how does change happen?” I would guess very few people could answer the question.
But when you ask them what they want to see different in the future, what works now and doesn’t, what they care about and why, what they want for their grandkids, what helped them to succeed or made a difference in their lives, etc. etc. - well, I’ve never met anyone who couldn’t answer those questions.
Whether or not they want change or status quo, are Milton Friedman acolytes or believe in a more robust social safety net, are absolutely committed to social justice or tend to think trial lawyers are all bad guys - people know what they care about. Within the answers to those questions is the answer to how they think change happens. And, within the answer to that, is the discussion that advisers should initiate with donors and donors should initiate with advisers - what are my options? how do they compare to each other? what is good for what? How do the many variables - change strategy, tax incentives, family concerns, costs, visibility, control - how do they complement or count each other out.
Donors will need - and are using - portfolios of giving products to meet their multiple needs. This is where the fun, the potential, and the multi-variate equations for being a good adviser comes into play.
Yes, its wonderful that more financial advisors are learning about philanthropy. I hope the trend goes the other way as well.
BY David Wilson
ON November 22, 2007 05:09 AM
The problem for me is 2 fold ( well it is multi but 2 main ones)
Political correctness
Society owes me
Political correctness - Any authority is extremely aware of make a judgment or decision for fear of ostracising a minority or be accused of favouring a majority – I do not envy them in their roles. Clear guidelines need to be set - this is the way it will be – and if it doesn’t suit find somewhere that does. I live in the Netherlands and there is no more PC country in the world - rules for rules sake so I am well versed in this type of environment.
Society owes me - society owes you nothing ! If you want it, get up and get it. To many people and that can be from the same sector of people as well as natives expect , homes, money, education , places of worship. I would remind them of the GOYA principle
Get Off You’re A….. .
I am not implying some extreme dictatorship – but common sense must prevail at some point
So all in all with these 2 points considered it make decision making – a nightmare. Will it ever come good – I hope so – for all our sakes.
BY Charles
ON March 31, 2008 09:50 AM
I agree that places like the International Association of Philanthropic Advisors is what donors should use when giving. Its not enough to just give it is the donors responsibility to make sure the money ends up in the right hands.