New report reveals generosity of family offices and a desire for more philanthropy advice
Family offices, while a source of generous philanthropy, would like more philanthropy advice and many would be willing to pay for it, according to a new report that offers a rare insight into the philanthropic nature of some of the UK’s wealthiest families.
The Family Philanthropy: Rewards and Challenges report, produced by Global Partnership Family Offices and non-profit consultancy and think tank New Philanthropy Capital (NPC), illustrates the generosity of wealthy families—88% of interviewees give to charity, and have on average supported 17 organisations in the last year.
They are also giving at considerable scale, with a quarter of interviewees giving between 5% and 10% of their total assets away, and 6% giving more than 20% of their total assets to charity. With over two thirds of survey respondents having liquid assets in excess of £50m (and almost 20% of them with liquid assets over £1bn), this translates as a substantial amount of funding for the charity sector.
The report also reveals that almost 60% of families would find some kind of philanthropy advice useful, particularly around monitoring charities’ performance—but many of them do not currently seek or receive this advice, while 30% of respondents said they’d be willing to pay for advice.
Jonathan Lidster, director of Global Partnership Family Offices, which provides services and support to family offices, says: “People pay for advice on investments, and philanthropy or impact investing is similar - you are still giving money to someone to do something with - irrespective of whether the money is to make more money or change something for the better. As such, with this idea in mind, why is it so difficult to implement the same philosophy when it comes to giving?”
Plum Lomax of NPC says of the reports findings: “They indicate that more advisors to UHNW individuals and families need to be well versed in the philanthropy landscape – advisors don’t need to have all the answers themselves, but they need to know what kind of services are out there to help families with their giving, and who are the main providers of these services – so that they can act as a concierge in this very fragmented landscape.”
This call to action has been answered by parts of the industry. Several leading private banks have hired in-house philanthropy experts, and some private client law firms have partnered with specialist philanthropy advisors. Collective action is also emerging in the form of the Philanthropy Advice Steering Group, a group of 35 private client advisors looking to develop the philanthropy advice market through the sharing of knowledge and ideas.
However, family offices, which are often the very closest advisors to high net worth families, or are even run by family members themselves, have not featured very prominently in the debate around philanthropy advice and due to the privacy surrounding family offices little is known about their philanthropic preferences and needs, which was the inspiration for this survey.
The survey also finds:
Families are significantly more motivated by giving back to the community and addressing needs than public recognition or social expectations.
Most of the families were satisfied with their recent giving experience, but unfavourable aspects include “tortuous administration” and the fear of being “actively pursued by charities”.
A large majority involve the younger generation in their giving—85% of respondents with children under 21 either discuss or actively involve their children.
More than 90% of families are planning either all or some of their giving and the top drivers in selecting charities to support are the charity’s vision and strategy and that the charity is focused on the greatest need.
The findings are based on 44 responses to a survey sent out to over 600 family offices in the UK.
Download the report here.