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Check in on your philanthropic approach

For every Philanthropist, the start of a new calendar year means decisions need to be made about charitable distributions to ensure the 30 June deadline is met.

Now is the perfect time to check in on your philanthropic approach and reflect, ‘what kind of impact do I want my philanthropy to have this year?’, ‘am I granting to charities in the best way’ or ‘do I need to review my strategy’?

In 2020, many giving strategies were adjusted to accommodate disaster response.  In 2021 we found that some families allocated a proportion of their giving to discretionary distributions but returned to their giving strategy to inform their decision-making.

What will 2022 mean for your strategy?

Carving out the time to reflect on your philanthropy can be difficult in our busy lives, but the investment of time does to lead to more considered and effective granting and greater personal satisfaction.

Take the time now to reflect on (or maybe revisit) your family’s mission, vision and values. This gives you way to evaluate new organisations and opportunities, and ensures that no matter which organisations you support, you’re moving towards achieving the social change you’re aiming for.

Things to consider

What is the objective/s you want to achieve with your giving? (for example, ‘Improve the ability of mid-career researchers to maintain their career trajectory while they start a family’ or ‘Give access to young people in regional and rural locations to access tertiary education’.)
What does the community look like if you were to achieve your ultimate vision?
What are your core family values? How do they influence your philanthropy? Do the organisations you support reflect your personal, or family, values?
Risk appetite 
Are you open to new ideas and concepts or do you prefer a tried-and-tested approach?
How do you know if your giving has been successful? How do you know whether you’re getting better at the practice of philanthropy and maximising your impact?
Enduring legacy 
Will a family member or trusted associate be available to work with on making granting decisions for your legacy into perpetuity?  Is now the right time to involve successors / next generation in discussions around philanthropy and giving?
In 2021, Equity Trustees launched Giving Consultancy Home (GC Home), an evolution of an existing service supporting philanthropists to craft or review their giving strategy. Giving Consultancy helps families to examine everything from family values, through to giving style and preferred areas of focus.  In the 2021 Annual Giving Review, we feature a number of families who completed a GC Home.
There are tens of thousands of charities in Australia that you could donate funds to. The first step is understanding which ones you’d like to donate to and why.
The second step is how to donate funds in a manner that is thoughtful, conducive to helping the charity address the specified problem, and with mechanisms in place to ensure you’re achieving what you set out to do.

Questions to determine how you will give to your chosen charities

1. What am I accountable for? How much time, funds or influence are you prepared to commit to the organisation and are all stakeholders aware of this?
2. Is this a one-off gift or am I prepared to enter into a multi-year arrangement? 
Multi-year giving helps the charity deliver the project or work sustainably without needing to frantically source alternative funds. Usually, multi-year arrangements are for $5,000+ donations and dependent on annual project reports or feedback.
3. How big is the problem and what/who will it take to resolve it? 
It has been said that the bigger the problem, the more collaboration is required. Sometimes this is collaboration you can encourage, influence or even lead yourself. Collaboration can occur between charities and/or philanthropists all working towards a common goal.
4. What about funding the boring stuff (capacity-building)? 
Running a charity costs money. Although exorbitant administration costs should be carefully evaluated, there is no getting around the fact that it’s often the basic costs of operation – such as attracting talented employees and ‘keeping the lights on’ – that charities need funding support for in order to continue delivering their services.
5. Is there opportunity to be flexible or responsive? 
Natural disasters and global pandemics have severely impacted the work of the for-purpose sector.  It has demonstrated the need for philanthropy to listen to the sector, ask where funds needed to be directed to have greatest impact and deliver funds quickly and without restriction.  
Relative to your available funds, how many charities should you support to maximise your impact?  Should you factor a discretionary component into your annual allocation, to allow for unexpected events like natural disasters?
Size matters. You only have a finite amount of funds and dividing them between too many charities begins to dilute the impact of your contribution. 

Considering these questions can help you engage in more purposeful and enriching philanthropy. It may lead you to a framework that determines which charities best resonate with you; the goal that you or your family are trying to achieve; and how you interact with the charities you choose to support.

If you’d like us to assist you in thinking through any of these points or would like to complete the Giving Consultancy experience, please contact your Relationship Manager.