Strategic philanthropy as a tool for building family impact

PHILANTHROPY, which involves donating money, time or knowledge to charitable causes, has been a popular way for many people and families to improve society, support the disadvantaged and make a positive impact. These actions are often motivated by charity, social responsibility, personal fulfilment or the desire to leave a legacy.

However, with the world facing complex social, economic and environmental issues, traditional charity alone may not be enough to drive meaningful change. This is where strategic philanthropy comes in. By providing a deliberate planning process, informed decision- making and sustained engagement, strategic philanthropy allows families to create a lasting impact in their communities that goes beyond ordinary giving methods.

So, what exactly is strategic philanthropy? It is a method of philanthropy that emphasises long- term impact, collaboration and systemic change, rather than just addressing immediate needs and providing short- term relief. Families that approach their philanthropy in a strategic way are more likely to have a significant and long- lasting influence in their communities.

In contrast, families that do not approach their philanthropy in a strategic way may face obstacles and constraints that prevent them from creating a lasting impact. Therefore, strategic philanthropy is a powerful tool that can help families make a meaningful and lasting difference in their communities.

Lack of a strategic approach can negatively impact philanthropy efforts in several ways. First, families who don’t have a clear strategic focus may allocate their limited resources to various causes and projects that may have little effect. This can lead to inefficiency and missed opportunities to bring about longlasting change.

Without strategic planning, families may invest in initiatives that don’t align with their goals, values, or the needs of the communities they aim to serve. This can result in wasted resources and missed opportunities to make a meaningful difference.

Third, families lacking a clear vision or mission in their philanthropic efforts may struggle with prioritising initiatives, making informed decisions, and potentially experiencing mission drift, leading to confusion, inconsistency, or loss of focus over time. In addition, families may find it difficult to assess the return on their philanthropic investments in the absence of clear objectives or performance indicators.

On the other hand, strategic philanthropy has several benefits. It provides families with a sense of purpose, fulfillment, and satisfaction by positively impacting others’ lives and making a significant difference in their communities.

Second, it enables families to better utilise their resources and make a more significant impact in the areas they support by addressing the underlying causes of problems and promoting long- lasting change through coordinated objectives and focused interventions.

Strategic philanthropy emphasises monitoring and assessment, enabling families to gauge the success of charitable endeavors and track progress towards their goals. Furthermore, it prioritises structural change and long- term solutions, allowing families to bring about long- lasting change that goes beyond one- off projects or programmes by funding initiatives that tackle underlying problems and foster community resilience.

Finally, strategic philanthropy encourages collaboration and partnership among philanthropists, nonprofit organisations, government agencies, and community stakeholders. Families that collaborate can pool resources, exchange knowledge, and take collective action to increase their impact.

Here are a practical strategies families can adopt to effectively execute strategic philanthropy:

Know the family vision: The family vision is fundamental to strategic philanthropy. It is the driving force behind a family’s values, priorities, and charitable endeavours. Families use their family vision as a mould for the charitable endeavours and make sure that the goals and values set are being met. The family vision also serves as a guide for meaningful giving and community involvement, whether it be in the areas of education, environmental conservation, or social justice. Families may come together around common objectives, and bring about long- lasting change in the world by expressing a shared vision. An example of a family with a vision is the Rockefeller Foundation. Their vision is to promote the well- being of humanity and create equitable opportunities for all people to thrive. This vision has guided their philanthropic efforts for over a century, leading to initiatives such as the Green Revolution to combat hunger, the creation of public health infrastructure, and investments in renewable energy solutions.

Define the family mission: The mission of strategic philanthropy defines the specific goals, objectives, and focus areas that guide philanthropic activities. It articulates the purpose and scope of the family’s philanthropic efforts and provides a framework for decisionmaking and resource allocation. A well- defined mission statement helps philanthropic families stay aligned with their vision, values, and strategic priorities.

An example is the Ford Foundation. The mission is to reduce poverty and injustice, strengthen democratic values, promote international cooperation, and advance human achievement. This clarity ensures the foundation can align its grantmaking strategies with its mission.

Carry out extensive research: Research plays a crucial role in strategic philanthropy by providing insights into community needs, best practices, and potential impact areas. Conducting thorough research allows philanthropic families to identify pressing social issues, understand root causes, and assess the effectiveness of existing interventions.

Research may involve analysing data, consulting experts, conducting needs assessments, and studying successful case studies. By leveraging research findings, philanthropic families can make informed decisions, target resources where they are most needed, and maximise the effectiveness of their philanthropic investments.

Team up and work with stakeholders: Collaboration and teamwork are essential principles of strategic philanthropy, as they enable philanthropic families to leverage diverse perspectives, expertise, and resources for greater impact.

Effective teamwork involves engaging family members, staff, advisors, and external partners such as companies, government agencies, nonprofits, and community stakeholder in philanthropic decision- making and implementation. By fostering a culture of collaboration, philanthropic families can generate innovative ideas, build strong partnerships, and amplify their collective efforts to address complex social challenges. Set measurable goals: Establishing precise and measurable objectives is crucial for directing charitable endeavours and evaluating their success. Goals should be in line with the family’s mission and core principles as well as the intended results of their charitable endeavours.

It must be clear, attainable, pertinent, and time- bound irrespective of the cause. Philanthropists can monitor their progress, assess their influence, and modify their techniques as necessary to attain their desired results by establishing specific goals.

Evaluate and learn: Another crucial element of strategic philanthropy is evaluation and learning, which helps donors gauge the success of their initiatives and make ongoing improvements to their tactics.

To ascertain whether charitable endeavours are yielding the desired effects, evaluation entails tracking developments, gathering information, and interpreting findings.

Learning is evaluating one’s achievements and shortcomings, noting lessons discovered, and modifying one’s approach considering criticism and supporting data. Philanthropists can increase the return on their investments and promote ongoing development in their charitable endeavours by establishing a culture of assessment and learning.