What is the Business Case for Offering Philanthropy Advice Services?


Magazine article

Which cause or charity should I support? And how much? How can I make a difference? Such questions and subsequent counsel are part of our everyday life. Emma Turner, Head of Client Philanthropy at Barclays looks at the justification for offering advice on such matters as a formal service to clients.

There are the informal ‘water cooler conversations’ about how much to give a friend who is running the marathon or climbing a mountain. Then there are the more serious dinner party debates where everyone knows a great cause and gives a pitch as to why we should all support it. The internet can help us find out more about the causes or charities we want to support, while educational courses can improve the focus of our philanthropic activities or help us become a more organised giver. Last, but not least, professional fund-raisers are all too keen to enlighten us to their cause and hopefully engage our support.

But how do individuals work their way through this minefield and come out the other side inspired with the confidence and motivation to enjoy giving?

There are certain activities you wouldn’t consider without professional advice: setting up a trust or managing tax matters aren’t usually embarked on without consultation with a lawyer, an accountant or a tax specialist. And so it might be that the obvious place to seek guidance on your philanthropic activities is a person who can give you expert advice.

It seems an obvious way to address a need, but let’s look at it from the other side: how does such an advisory role fit into a business and what are the drivers for a firm to dedicate a full- or part-time resource to this area? How can philanthropy be integrated into a client service offering and how should it be positioned both externally and internally?

Research to find out how to build the philanthropy advice market has been carried out over the years, most recently in February 2013 by Philanthropy Impact and Scorpio Partnership following a survey carried out in 2012 of the advisory population which included lawyers, private bankers, philanthropy advisors and accountants. Compared to NPC’s research conducted in 2008 the market in providing philanthropy advice hasn’t developed as much as anticipated.

Interestingly, in 2008, 60% of participants thought philanthropy advice would be core to a wealth advisor’s offerings within five years. Fast forward to 2013 and only 31% thought it was central to their firm’s offering. However in 2012, 66% thought that philanthropy advice added value to their firm’s offering. It seems that the jury is still out on how this service can work best and for whom.

In November 2008, I was hired into a new role created by Barclays Wealth and Investment Management: they had understood that ‘clients need advice which extends to more than just managing financial assets. Through a philanthropic programme we can help clients identify the right structure, ensure giving aims are achieved, involve the family to create an inter-generational legacy and develop their own philanthropic vision’.

Clearly Barclays felt there was value in providing this service but what did that really mean? In order for a client philanthropy service to really work I believe there needs to be some key foundation stones to underpin it.

Firstly, the organisation offering the advice needs to ‘walk the walk’ not just ‘talk the talk’. The service then becomes a natural extension of how you are supporting employee volunteering, fundraising or giving activity as well as corporate community investment strategy. However, be prepared for one of the first questions a client may ask, when philanthropy comes up: ”what does your organisation give to charity?” as well as asking you what you personally do.

Secondly it needs the buy-in and support from the top. This way, bankers (in my case) or other co-workers, know it has endorsement and isn’t just a nice idea which has no real substance or business value. Philanthropy advice done well can help build reputation – done badly it can damage in equal measure.

Thirdly, a decision has to be made on how to resource the service. It can be in-house with a dedicated full or part-time headcount or outsourced entirely to external advisers. The latter may be a good starting point for a small firm which wants to see some success before dedicating an in-house person. It will depend on the company, its resources and objectives.

For those organisations advising private clients, I believe this role should be truly embedded in the business and offered as a free service to clients; making it more acceptable and adding real value to the relationship. It makes initial conversations easier as there is no worry about clocking up a ‘charity advice bill’. It also enables the advisor to sit in a totally neutral place, working alongside the banker, with only the client’s best interests at heart – there is no buy or sell involved.

The range of service provided will depend on the level and skill of the adviser. At Barclays, we aim to engage, educate and support our HNW clients on their giving journey in four key areas:

1. Information for practical, flexible and effective giving including guidance on giving vehicle options

2. Help in identifying drivers, connections, right cause area/s, extent and profile of involvement to achieve the desired effect

3. Engaging the family, creating a inter-generational legacy, giving while living rather than just ‘legacy at death’

4. Inspirational learning through research/literature as well as exclusive client events

In the UK we complement this with the support of third party advisors (the Charities Aid Foundation (CAF), the UK Community Foundations, the Institute of Philanthropy and New Philanthropy Capital (NPC)) which enables us to provide a comprehensive service without having to be experts at everything. We also commission and produce research to provide greater insight into current thinking and best practice as well as organising events for clients to share their experiences with other philanthropists and professionals in the field.

Such a service takes time to build and deliver, but when you have done so the benefits will be there for all to see: whether through improved engagement with clients or prospects or being seen as a thought leader in the philanthropy advice market place.

This article is tagged under:

  • Philanthropy Advice
  • Promoting philanthropy