From fragments to a mosaic

Melissa A Berman

Trained as a medievalist, I generally approach any assignment by looking back in time for origins, exemplars and trends. For an overview of professional philanthropy advisers, this task can be completed in about 45 seconds.

The first full-time professional philanthropic adviser seems to have been Frederick Gates (no relation to Bill), who was hired in the late 19th century by John D Rockefeller. Gates was both a successful business man and a Baptist minister, embodying Rockefeller’s faith-based values and his business-like approach to what he and Gates called ‘wholesale’ (vs retail) philanthropy. Many significant donors, from Rockefeller’s era through to our own, hire a full-time adviser or team – either as part of their family office or as the staff of a foundation.

What this issue of Alliance is focused on, however, is the multi-client philanthropic adviser: the individual or organization that supports many donors, each with a different agenda and approach. Here the historical research process takes only 23 seconds. Peter Karoff founded The Philanthropic Initiative some 20 years ago, offering a combination of strategic planning, management services, research, programmes and promotion of philanthropy. Now ably led by Ellen Remmer, TPI is a valued colleague for the whole field of philanthropy.

Credit Steve SnodgrassA dearth, not a glut

We’re frequently asked by various observers of private philanthropy – the media, attorneys, etc – about the ‘proliferation’ of philanthropic advisers. I think most of us who are active in this field see it differently: compared to the numbers of other professional advisers to the ultra-wealthy, and compared to the actual (much less potential) amount of philanthropy, there’s a scanty supply of advisers. Few organizations have managed to grow beyond a dozen staff. Small boutiques and solo practitioners are the norm. Collectively, I’d estimate that we serve less than 1 per cent of the potential market. (Please note that medievalists are not known for reliable statistics.)

Why is this field still so small, given all the attention to and growth in philanthropy over the last 10 to15 years? In my view, it all boils down to the widely held view that private philanthropy is not something that requires professional expertise. Many factors – on both the supply and the demand sides of philanthropic advisory work – conspire to create that view.

Plenty of free – but not necessarily informed – advice

On the supply side, the willingness of many people unconnected to philanthropy to offer philanthropic advice reinforces the perception that common sense and connections are all one needs for an effective giving programme. While your car mechanic would not (I hope) give you advice about your teeth, and your dentist would probably decline to look at your carburettor, both will likely happily tell you where to donate your money.

Because philanthropy isn’t seen as requiring professional knowledge and experience, pretty much anyone can declare themselves a philanthropic adviser, and hang out a shingle. Well, perhaps not a shingle but certainly a website. And why shouldn’t they? Certainly their integrity, commitment and enthusiasm are not at issue here. What is at issue is the matter of professional qualifications and standards.

The balancing act

Professional qualifications would include demonstrated knowledge and experience of how philanthropy makes change happen. It would also include adherence to a set of ethical principles. Like other professionals, philanthropic advisers should have a code that binds them to managing the same delicate balance as other professionals: between serving their clients’ interests and adhering to the standards of their field.

Credit The Donkey SanctuaryThat balance often isn’t easy. What does one say to a donor who says he doesn’t want to pay for any ‘overhead’, that someone else can pay for that? What about a donor who wants to fund a ‘cost-effective’ substance addiction programme that has negligible success over the longer term? I’m not sure how donkey sanctuaries became the litmus test of our field, but I’m pretty clear on that issue: if a donor wants to protect donkeys, that’s his/her right, and I’m in no position to declare that donkeys are less worthy of a sanctuary than any other species. After all, both Jesus Christ and St Francis of Assisi rode donkeys. In these examples, it’s relatively easy to see a bright line between a practice that’s harmful (not covering a non-profit’s legitimate operating expenses) and a choice that’s, shall we say, eccentric. But all of us in the advisory field have stood in the hazy fields of ethical uncertainty, feeling like baffled donkeys.

In addition, philanthropic advisers need a code that addresses conflicts of interest – real or perceived. For example, if I recommend a grant to an organization on whose board I serve, I will receive no payment – but perhaps some valuable social capital. So that relationship needs to be disclosed, along with the steps taken to compare that organization to other choices.

More challenging is separating one’s personal views from professional advice. Suppose you object to orphanages that send kids thousands of miles from their homeland for adoption. Do you dissuade your client from supporting such groups? On what basis? If you explain that point of view and your client is not moved, do you resign?

This is not to say that I think the field of philanthropic advising is rife with bad advice and hidden self-interest. Professional standards, including a code of ethics, are important mostly because they begin a dialogue between the donor and the adviser that emphasizes that this work is being done professionally and thoughtfully, and that while the donor is the client, the adviser merits the professional respect accorded to other advisers – like car mechanics and dentists.

The demand side

On the demand side, individuals and families with significant wealth increasingly view philanthropy as a core component of their life, seeking a deeper engagement and involvement, at earlier phases of their lives, than did prior generations. And this commitment to philanthropy is no longer solely a US attitude. Thus, many individuals and families with great resources now seek to use philanthropy to address important issues and solve complex problems. While they continue to support large, highly regarded educational, medical and cultural institutions, they also want to tackle issues like access to water, climate change, and income generation for the poor.

Yet while philanthropy for these new kinds of challenges is more complex, wealth holders continue to feel that they should be able to develop giving programmes on their own. If involvement in philanthropy is defined as part of being a good person, there’s often an unstated assumption that a good person would find it easy and natural. And while that’s certainly true for many types of giving, it’s not true for all of them. Yet many donors feel uncomfortable seeking advice about their giving. Their other advisers are hard-pressed to know how to help them begin.

Strangers in a strange land

Many potential donors have trouble finding the on-ramp for issue-oriented philanthropy programmes. They are strangers in a strange land, and justifiably mistrustful of random encounters with advisers or recommendations when they lack a sense of the landscape as a whole. Research and interviews – formal and informal – have revealed over and over that donors feel they can’t get access to basic information, whether about a topic or about how to begin a family programme. The resources in our field to are too few and too far-flung. Much is written for philanthropy professionals – who deserve great materials. But private donors deserve great materials too.

At Rockefeller Philanthropy Advisors, we are thus particularly grateful to the Gates Foundation for a new three-year grant to help to develop some of these donor resources, and to make them available to philanthropic advisers and others who work with private donors or potential donors. In fact, we look forward to partnering with our colleagues around the world on developing and disseminating these resources.

Given the tremendous need for thoughtful, effective philanthropy, none of us can wait for new donors to come to us – we have to go out and meet them, and meet them with the resources they seek and the assurances they need that professional help in philanthropy will help them achieve their goals more quickly. If we are to do this, we need a stronger philanthropic advisory profession, moving from fragments to a mosaic.

Melissa Berman is president of Rockefeller Philanthropy Advisors, USA. Email

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