How does today's social impact culture mindset affect the way you engage your children and grandchildren in your family's philanthropy? That's a question many trustees of America's 42,000 family foundations are asking themselves as they look more closely at strategies to fulfill community passions, conduct responsible grant making, and inspire a philanthropic legacy for the next generation.
Here are three tips from the private foundation administration experts at RenPSG.
1. Clarify your family's passion and deepen communication of your original vision.
Situation: It is common for children and grandchildren to get confused about the process for making decisions about which nonprofits to support. "Our family foundation takes a shotgun approach," commented the daughter of an entrepreneur who formed a family foundation upon the sale of a business. By contrast, when we interviewed the founder, his comments were the opposite: "Every grant I've ever made has been 100% aligned with my commitment to supporting a healthy workforce in our community. Without a healthy workforce, my business would never have been successful."
Takeaway: Make sure your family foundation's records include the reasons for grant making and the underlying passion that started the foundation to begin with. Surround yourself with advisors who understand that the communication of vision and passion must be a priority, especially in today's social impact culture. Your online portal for foundation grant making should showcase your foundation's story and vision statement so that family members see it, every single time they log in.
2. Validate grantee reporting with a quick check online.
Situation: We recently talked with a college student about her involvement with her grandparents' foundation. Here's what she said: "I am glad I am part of our family's semi-annual meetings to discuss grantees from the foundation my grandparents started a few years ago. One thing that surprises me, though, is that the grant reports we review don't always match what the nonprofits list on their websites as 'impact.' I want our family to be able to communicate about these issues between meetings--online--so we are not caught off guard when we start to Google our grantees before the meeting."
Takeaway: With information readily available at your fingertips about nonprofits and their programs, your opportunity--and responsibility--is to be familiar with what's out there. The next generation of philanthropists is checking out charities online--and your foundation should be, too. Look beyond the reports submitted by grantees to determine how impact and outcomes are being reported on the websites of the nonprofits you support. Then, share that information with your family members in a group chat or other online communications channel so everyone is looking at the same data. Your family will become more familiar with the causes you support. You'll also build a communications framework that extends across generations as technology in philanthropy continues to make rapid advances.
3. Put social impact at the top of every meeting agenda.
Your private foundation board gatherings are an opportunity to set a professional focus to your meeting agendas--even if the meetings are family-oriented and include a strong social component. In today's social impact culture, work, life, and community have converged. It's up to you to include discussions of the ways your foundation's grant making is making a difference in the lives of real people in the communities you support.
Situation: We talked with several grandchildren who were involved with their families' foundations. Their comments were notable:
- "Philanthropy is really part of my lifestyle, so I need to be reminded at every meeting that the giving we do through our private family foundation is having a specific impact."
- "I am doing a lot of good already, by volunteering and serving on boards. Plus I try to purchase products from brands that support a cause. So, I am inundated with 'doing good' every day of my life. Our family foundation needs to stand out, and the meetings are where it all comes together. Otherwise it's just one more thing to deal with."
- "Being part of our family foundation is most interesting to me because of the data we get from grantee nonprofits. It is so interesting to review it at the meetings. Plus, I want to be able to go online to see how our foundation is supporting specific nonprofits. This helps me decide which community events to attend to celebrate favorite causes. I can't go bananas and buy tickets to every gala, as much as I do love to celebrate!"
Takeaway: Your family foundation's meeting agendas need to go beyond just the traditional check-the-box legal and financial matters. Focus on social impact and the important role of your family's philanthropy to enrich the lives and wellbeing of your children and grandchildren.