Donor advising is fast-growing cottage industry, study shows
A report on the US donor advisory field by the Human Interaction Research Institute describes it as a “fast growing cottage industry which has not yet fully developed a business model.”
‘Donor Advisors and Philanthropic Strategy’ highlights several common characteristics of effective donor advising:
- Building trust between advisor and donor
- Finding a psychologically based understanding of donor intent and behaviour
- Drawing on knowledge and experience of philanthropy, the non-profit sector and the community
- Doing skilful research to provide data for donor decision-making
The findings are based on interviews with 75 donor advisors including accountants, wealth managers, private bankers and trust and estate attorneys.
The report also found a great range of practise in the field, and that not all advisors interact with clients in all key areas. With technology allowing donors more direct access to beneficiaries, and with media exposure of prominent philanthropists: “Donors are getting more sophisticated – advisors who haven’t kept up with the growth of the field are easy to pick out, and are at a competitive disadvantage.”
The report’s authors conclude that more rigorous training, and professional guidelines, for advising on philanthropy are needed.
“For those advisors not specialising in philanthropic advising, the provision of some philanthropic output may be done without fee, but this is changing as the demand for this service increases. It is also changing as both advisor and donor begin to understand better how complex effective philanthropy can be.”
- To request a PDF copy of the report, contact the Institute at firstname.lastname@example.org