What is a philanthropic advisor?
Simply put, philanthropic advisors are individuals or teams hired by a donor or family to navigate the how, what, and why of giving and to improve charitable outcomes. They can also help guide interested donors through social impact investing and how it may contribute to their philanthropic goals. But a good philanthropic advisor can be much more to a donor or family than this short definition suggests. Below are some specific ways a philanthropic advisor can help.
Simply put, philanthropic advisors are individuals or teams hired by a donor or family to navigate the how, what, and why of giving and to improve charitable outcomes. They can also help guide interested donors through social impact investing and how it may contribute to their philanthropic goals. But a good philanthropic advisor can be much more to a donor or family than this short definition suggests. Below are some specific ways a philanthropic advisor can help.
Most donors want their philanthropic dollars to be used effectively and to find joy and satisfaction from their giving. But navigating the world of philanthropy can be a challenge. Knowing how and where to give to maximize impact requires experience and expertise that many individual donors and families don’t have, especially when first getting started. Even donors who’ve gained considerable knowledge about philanthropy may not have the time to develop and implement a strategy. A philanthropic advisor can help. This guide provides answers to common and important questions about the role that philanthropic advisors play in supporting charitable planning and giving, as well as factors to consider before engaging an advisor. This resource was co-created by Fidelity Charitable and a group of leading philanthropic advisory firms to provide a resource for donors wanting to learn more about how to engage expert help to become more effective givers.
This information was created by Fidelity Charitable helps donors maximize their generosity through donor-advised funds, research, and guidance. Learn more about Fidelity Charitable's streamlined Giving Account on their website.
What services can a philanthropic advisor provide?
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They help design a strategy or plan for giving.
Philanthropic advisors can help donors clarify their values, mission and goals. A philanthropic advisor will listen to donors’ charitable interests and priorities and work with them to document and define an approach that meets their needs. This support gives shape and brings clarity to a donor’s ideas and helps translate them to action. |
They support and facilitate discussions among families.
Giving together as a family can be a rewarding experience, but it’s not always easy. Philanthropic advisors give families the tools to examine individual family member’s interests and desires to participate in family philanthropy and then use that information to define each member’s role in the family’s philanthropy and to support them in deciding where and how they will focus their resources as a group and/or as individuals. |
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They identify giving opportunities and carry out plans.
Some donors know what causes are important to them but still need assistance finding the right nonprofits and giving opportunities. Philanthropic advisors use their expertise as well as their professional relationships to match a donor’s charitable vision with suitable organizations or projects—and they can help structure the funding agreements, too. |
They coordinate with investment advisors and financial planning experts.
Philanthropic advisors are less focused on tax and financial planning and more focused on matters related to the distribution of charitable assets. However, they may work with a donor’s financial advisor, tax attorney, estate planner and other experts who play important roles in helping an individual determine which assets to give to charity and when, which giving vehicles are most appropriate, and how best to integrate charitable giving goals into broader financial plans. |
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They evaluate the impact of donor grants.
Results-oriented donors can rely on philanthropic advisors to help them understand how, and if, their giving is leading to the outcomes they hope to achieve. |
They identify other aligned funders or learning partners.
Philanthropic advisors can help donors who wish to make a bigger impact in a specific area to identify like-minded individuals with whom to meet and collaborate. |
When does a donor need a philanthropic advisor?
- When philanthropy requires more time and focus than a donor can give.
People who’ve dipped a toe in financial planning know how time-consuming it can be—in fact it’s one reason why many households hire financial advisors. Philanthropic planning can be equally complex. A philanthropic advisor can assist busy individuals and families with the research and evaluation of nonprofits, including deciding where to give, how much to give and over what length of time. Many dedicated givers also feel overwhelmed by the number and frequency of requests they receive from nonprofits. Advisors can help by managing relationships with nonprofits, especially for donors who prefer to remain anonymous. They also can step in to help clients focus on the causes and issues that matter most to donors and support them in developing a tailored, proactive plan for their giving.
Donor example: An individual woman who is the sole inheritor to a family fortune comes from a family with a heralded philanthropic legacy, yet wished to remain out of the public eye. Arabella designed a team based on the family’s culture and the individual’s personality and working style. They guided the donor in developing mission, vision, and values statements and helped her focus her giving strategy on public education advocacy and humanities education. Her Arabella team developed and executed a plan that builds on her passions, respects the way she wants to engage in the family’s philanthropy, and is realistic given the time she can commit. With Arabella’s support, the donor was able to develop a grants portfolio driven by her and her family’s values that promises to have great impact on the fields in which she is investing.
Donor example: A three-generation family that had been grant making for years decided to make their family giving strategy more transparent. As pleased as they were to lift up to prospective grantees their giving priorities and goals, they found that publicly communicating their giving priorities significantly increased the number and frequency of funding requests. VENTURE3Philanthropy was invited to design and develop a simple system for use by the family to track and review funding requests. Once the new, simple system was up and operating, the family was more aware of the status of all funding requests and what grant recommendations best fulfilled their giving strategy. With VENTURE3Philanthropy’s support, the previous family feelings of being overwhelmed ceased, and the family’s simple system of organization and communications produced more timely and effective decisions for grant recommendations that more closely aligned to their giving priorities. It helped ensure that the whole giving experience was one of joy, with deep personal meaning and desired social impact. - When a change in finances leaves a donor with more to give.
A philanthropic advisor can help individuals who have experienced a financial windfall and have more to give than in the past by working to clarify their charitable priorities and motivations. Having a well-defined plan in place allows donors to feel more confident in their decision making around giving, especially when giving at significant levels.
Donor example: After Paul Carter (names changed) sold his company, he wanted to engage in philanthropy at a deeper level. Excellence in Giving recommended he start with their Discovery Process. They led a two-hour interview to guide Paul and his wife Rebecca in conversation about their backgrounds, interests and how they dream about changing the world. They explored their past to inform their future goals. While Paul and Rebecca could already verbalize many of their philanthropic goals, the process allowed them to consider the full scope of what they enjoy (and don’t enjoy) about their giving. In the end, they defined goals and preferences. But more importantly, they effectively communicated family values and giving goals to their three teenage daughters who probably did not know much about the family’s giving priorities and philosophies. The Giving Profile became a helpful tool to have new conversations about what the Carter family stands for and what their philanthropy is all about. Excellence in Giving now helps them execute their giving at significant levels with confidence, according to the values they documented. - When a donor wants in-depth information about a cause.
Philanthropic advisors use their expertise to research topics or issues a donor may be considering supporting. Advisors may look for key opportunities for philanthropic funding and identify high-impact organizations that are working in a particular sector or area.
Donor example: Spurred by the changing political environment in the United States, a donor came to Rockefeller Philanthropy Advisors for help in developing a strategy for her grant making focused on civic engagement, freedom of the press and voting. RPA led her through a process to clarify her values and to develop a mission as well as giving guidelines for her philanthropy. To ensure that the donor had a thorough understanding of the existing landscape, RPA conducted research and analysis of the status of issues in which she was interested, including key funders and potential grantees. RPA also created a grants process, and ultimately supported her in making more than $1 million in grants. RPA continues to be involved, introducing the donor to leaders in her issue areas, recommending learning opportunities and serving as a source of thought partnership on involving her children in her philanthropy. - When a donor wants to understand a charitable impact.
A philanthropic advisor can help a donor track the impact of her giving by monitoring and evaluating the grants she has made to nonprofits. Following up with nonprofit staff and analyzing reports provided by organizations help an advisor determine if a donor’s charitable aims are being met. This tracking also can inform discussions about potential adjustments to a giving strategy.
Donor example: The directors of the Urban Action Fund (UAF) were proud to be completing their first decade of grant making for social science research. As they reached this milestone, they were eager to know the degree to which the fund was fulfilling its mission and what adjustments they might make in their future decision making. They had evidence that their grants had led to major policy changes and benefits for communities, but they wanted to know more about what had led to successful outcomes and where organizations faced challenges. UAF asked GMA Foundations to lead them in an impact assessment. GMA’s research both confirmed the impact of their grant making and also identified key characteristics that led to the success or failure of the funded projects. The report helped the directors refine the fund’s review process and communication with applicants. - When important life events impact a family.
When a family experiences a liquidity event or significant life event, such as a marriage, birth or death, the responsibilities and activities of those involved in the family’s giving may also experience transition. Sometimes this change is best navigated in multigenerational families by an independent party, such as a philanthropic advisor. An advisor can support the conversations and provide guidance around the family’s giving choices and how those may be continued or altered.
An advisor can also help a family that’s just getting started in charitable giving by making sure members are answering important questions about the roles, level of involvement and extent of collaboration expected from everyone. Cooperation at the beginning of philanthropic planning can pave the way for greater agreement and more impactful giving decisions as the months and years pass.
Donor example: From the start, a family foundation in Boston (which is actually a donor-advised fund used by a family to structure their philanthropy) has been deeply rooted in social justice in Greater Boston and some other parts of the world. The donors—a couple with strong ties to the city and strongly held philanthropic values—knew they wanted to pass down their legacy and foundation to the next generation. However, turning toward the future to create a multigenerational legacy can be daunting. During family meetings, the couple found themselves sharing their grant recommendation process and grantee information without much involvement from the next generation. After making their daughter, two sons, and two daughters-in-law trustees, they agreed it was time to create a philanthropic plan. The family needed structures in place that would not only allow them to grow as a foundation but would also involve each trustee as a thoughtful, strategic and collaborative partner. They turned to The Philanthropic Initiative (TPI) during this period of great change. TPI guided the family through crafting a donor legacy statement, curating guidelines for grant making and creating a philanthropic plan. TPI interviewed each trustee to ensure all thoughts and ideas about the future of the foundation were being heard. By undergoing a strategic planning process, the family has been able to ramp up their giving to achieve highimpact philanthropy. The donors now spend family meetings engaged in deep, thoughtful conversations that lead to joint decisions regarding the future of the fund. - When a donor wants help to design and manage significant legacy gifts.
Philanthropic advisors can provide accompaniment to ensure that legacy gifts have long-term benefits to the organizations they choose to support.
Donor example: A sophisticated donor with significant charitable assets wanted to gift the bulk of her wealth in her lifetime to a set of selected organizations. She understood the need to build the capacity of these organizations in order for them to absorb and maximize the power of a large legacy gift. Dietel & Partners has been working over the past few years to act as liaison between select organizations and the donor, design and negotiate staged capacity building grants, and provide strategic thought partnership for legacy gift decisions. The donor has increased confidence in deploying large tranches of charitable capital and enjoys seeing the organizations she cares deeply about becoming stronger and more adept.
