A lot of people treat giving as a spontaneous event: the canvasser shows up at the door, we see the donation bucket in front of the grocery store, we hear news of some disaster on TV, and we're moved to give. That's a perfectly viable way to do good in the world. But for more significant donations, it makes sense to be more strategic.
In January of last year, I had the pleasure of meeting Canadian business legend Charles Bronfman, of Seagram's fame, at the TIGER 21 conference in Palm Beach, Florida. Bronfman is a major philanthropist, contributing to a number of high-profile charities and causes in Canada and around the world. He's also become something of a philanthropic guru.
Bronfman believes strongly in the importance of thinking before you give. "The same attention should be given to philanthropy as is given to one's business. I don't believe it is happening," he told me. "We all have business plans for our investments, for our companies, but most of us don't have a business plan for our philanthropy."
"Many people say, 'I know how to do [charitable giving]because I did a business, I made a lot of money, therefore if I made it, I can give it away with the same intelligence and I'll just do it,'" he said. "Well, not so."
Bronfman feels so strongly about the topic he wrote a book about it: The Art of Giving: Where the Soul Meets a Business Plan. Anyone interested in getting the most bang for their charitable buck should read it.
Bronfman's central point is that we need to understand what we're trying to do when we give money away. The best way to do this is to ask ourselves some probing, unexpected, and ultimately uncomfortable questions. I use that word because Bronfman's questions challenge our assumptions about charity, and the judgments we sometimes make about what giving away money really means. The idea is to be honest and candid as a way of discovering what kind of charity you should be doing.
While Bronfman's audience is high-net-worth business owners, I think the lessons are applicable to every would-be philanthropist, regardless of their net worth. With that in mind, here are four hard questions that I suggest you challenge yourself with.
Do I have an "edifice complex"? I love Bronfman's turn of phrase here. For some, the idea of supporting a charity is wrapped up with buildings, plaques, and scholarships that bear their name. This pride in "public giving" is part of their goal of building a legacy: an idea that they stood for something good in their lives.
Even for those who will never see a building with our names on it, the question is an important one. Do you believe giving is most sincere when it's anonymous? How much do you want others to know about your giving? How much of your identity is wrapped up in the causes you support? Your answers will steer you toward some charitable structures and away from others.
How involved do I really want to be? Some philanthropists want to give more than money: they want to donate their time, their professional skills, and their networking capability to the cause. They want to get involved with the cause, either on the "front line" or on the executive or director level. Others are fine writing a cheque and getting on with their lives.
Do you have the time and/or the inclination to get involved with your charity on a non-financial level? Do you want to sit on the board of your charity? What about "front line" work helping those in need? Or would you rather keep giving as a financial transaction?
How important is it that my philanthropy actually succeed? A question that cuts to the core of how you see the world. While every charity hopes to affect change, only some of them will actually succeed.
How important is it that your charity has "realistic" goals? Do you want to see progress toward those goals from year to year? Or do you see charity as a more idealistic effort: a place where organizations show the world what's possible? Ultimately, are you content that a charity simply "fights the good fight"? Or would you rather lend support to causes that actually stand a good chance of effecting real change?
Do I want to help the most vulnerable? Or the ones most capable of helping themselves? A very difficult question when you put it in those terms. Some people believe charity exists to lend a hand to those in need. Others believe charity is a force to encourage innovation, leadership, and excellence. What about you? Do you want to donate to a homeless shelter or a scholarship fund? Cancer research or funding for the arts? Perhaps you want to do both—how much goes to either side?
When assessing your charitable plans for the future, lets be challenged and inspired by Charles Bronfman's thought leadership and experience.
Thane Stenner is founder of Stenner Investment Partners within Richardson GMP Ltd., as well as Director, Wealth Management. Thane is also Managing Director for TIGER 21 Canada (www.tiger21.com/canada). He is the bestselling author of ´True Wealth: an expert guide for high-net-worth individuals (and their advisors)'. (www.stennerinvestmentpartners.com) (Thane.Stenner@RichardsonGMP.com). The opinions expressed in this article are the opinions of the author and readers should not assume they reflect the opinions or recommendations of Richardson GMP Ltd. or its affiliates. Richardson GMP Limited, Member Canadian Investor Protection Fund.