Giving for Good: Philanthropic Wealth Management

By Elizabeth Harrin (London)

Most people associate fund management with the hard-edged side of financial services. But it’s not all about fighting over the top stocks and knowing which off-exchange trading venue is hot. There’s a whole industry around getting the best out of other people’s money – philanthropic services.

“Our role is to offer guidance and support to our donors in every aspect of their charitable giving,” says Elizabeth Brown, Vice President of Philanthropic Services at the Marin Community Foundation, one of the largest community foundations in the U.S.  It manages the assets of the Leonard and Beryl H. Buck Trust and 350 funds established by individuals, families, and businesses, and has invested over $800 million in the work of nonprofit organizations. “Each of our donors works with a personal philanthropic advisor to determine their giving strategy, which varies depending on their values and interest areas,” she adds.

Philanthropic services can be the entire reason for the existence of an organization – like the Marin Community Foundation – or divisions of larger fund management firms. Spencer-Churchill Miller Private, a boutique wealth management firm in the UK, has recently created a philanthropic off-shoot: SCM Philanthropy.

The Basics of Philanthropic Wealth Management

“We do not get anything beneficial in terms of finances, tax breaks or investment business,” explains Founder and Chair Gina Miller. “Don’t get me wrong, some of our potential investors may like what we are doing on the charity side but unlike other organisations they do not get any extra financial advantage from giving through us. What they do get is assurance their donations are going where they can do they most good with a minimum of administrative costs and regular follow-up feedback.”

As well as the standard range of fund management services, philanthropic wealth managers often provide other services to donors. “We do research on issues and organizations, hold briefings so people can learn more about community needs, help people craft a personal giving plan, and take them on site visits to learn more about local agencies and the work they do.” Brown and her team take care of all the administrative aspects of charitable giving, including reporting for tax purposes. “We help people donate a wide variety of assets, including securities and real estate,” she adds. This often adds up to a relationship that can stretch across generations. “We help families create a philanthropic legacy,” says Brown, “by helping them involve their families in their giving, and by ensuring that the goals they established in their estate plans are honored and fulfilled. Through charitable funds they’ve established with us, our donors are making a difference on the issues that matter the most to them, whether that’s here in Marin County, elsewhere in the U.S., or around the world.”

There are many reasons why high-net worth individuals want to donate assets to charitable organizations through a foundation or grant-making institute.

“It’s partly due to the tax benefit of being able to donate appreciated assets, not being subject to capital gains and receiving a tax benefit from the donation,” says Victoria Collins, Executive Vice President and Principal at First Foundation Advisors. “Mostly though, I believe, investors as human beings are interested in helping those less fortunate and usually investors have the means in addition to the desire to do so.”

Measuring Success: Job Satisfaction

And of course, it’s not just the donors and recipients who benefit: knowing that you are at work and the job you do is making a difference gives those who work in philanthropic services a great sense of job satisfaction.

“We are passionate believers that charity is fundamental to a healthy society,” says Miller. “We see it as a natural extension to our business philosophy and values. The SCM Philanthropy team are socially and financially fortunate and in a position to use their status and considerable contacts to leverage substantial funds.”

“I have the privilege of working with donors every day around the issues that concern them the most, be it in Marin, the nation, or across the globe,” says Brown. “I’ve found that people are at their best when they are philanthropic – the ‘giving’ is not just from their wallets. Our donors bring a great combination of compassion, conviction, and curiosity to their decision making. It’s a pleasure to be part of that process.”

Brown has worked in philanthropy for over sixteen years and she believes it is a field with great opportunities for women in leadership positions. There are roles to be had as executives in foundations and on governing boards. “I’ve never been short on mentors and role models,” she says. “If you’d asked me 25 years ago what I wanted to be when I grew up, I think I would have said working for a Senator, or maybe becoming one, or working at an embassy for the State Department. I’m very happy to have landed in this field instead, as I think I probably get to see change happen more directly on a daily basis than I would in those roles. I hope that there is more awareness now about the role of philanthropy and that there are young women in high school aspiring to work for a foundation as a career choice.”