After two recent conversations with wealth advisors, who were also nonprofit board members and were wrestling with whether they should discuss their own philanthropic priorities with their clients, I began to give this topic some thought. These individuals understood that, as board members, they were expected to be connectors, but they were trying to balance their desire to help their nonprofit build relationships with their professional obligation to protect their clients and certainly not thrust their own philanthropic priorities upon them. My research took me to the recently published U.S. Trust Study of the Philanthropic Conversation. This study, in addition to the Bank of America Study of High Net Worth Philanthropy, illuminated this dilemma even further – actually, it identified a disconnect between the wishes and expectations of high-net-worth individuals and their advisors.
High-net-worth individuals are typically purposeful in their giving: 71% have a strategy for giving and 43% have a charitable provision in their will. Not unlike many other donors, their number one reason cited as a motivation for giving is being moved by how their gift could make a difference. Forty percent of these donors rely on advice from a professional advisor about their giving. Thirty-four percent of HNWI’s said they would place more value on the professional’s advice if they knew about their advisor’s personal philanthropic engagement. The data confirms high-net-worth donors want a relationship with their advisors and look to them to help fulfill their philanthropic goals. Reading these facts, I was even more surprised that advisors are sometimes hesitant to discuss charitable interests with their clients.
The U.S. Trust Study found that 89% of advisors report they discuss philanthropy with their clients; however, only 55% of high-net-worth individuals say they are having philanthropic discussions with their advisors. What mattered most to high-net-worth individuals was not who initiated the conversation, but that the conversations happen in a meaningful way early in the relationship. Of course there are many types of advisors and we’re talking about “wealth” across a broad spectrum – perhaps in a relationship with a broker, or accountant, philanthropic conversations don’t occur as often as they do with a trust officer or with those at higher wealth levels.
Whatever the disconnect, the bottom line seems to be that donors want to talk about their philanthropy, and not just the technical vehicles for giving or the tax benefits of giving. I love to ask people about their philanthropic priorities as it always tells me more about the donor, their passions and goals.
From the nonprofit’s perspective, make it easy for your board members who are also professional advisors to help you. They cannot reveal their clients to you, so rather than ask who they can cultivate or solicit, perhaps sharing a list of your prospects for their review would make it easier for them to choose who they can help with and not comment on why they can’t help with others. You’ve brought them onto your board because they’re connected, but they may need your help figuring out how to help you. If you have events, they can invite clients to join them at your events, but they can’t solicit them. So, if the guest comes to your event, use the opportunity to begin to build the relationship with your organization and don’t rely on the advisor to take the next step.
Whether a nonprofit executive or a board member, ask about and listen to donors’ ideas and goals for their philanthropy. Then make it easy for them to see the potential difference their gift can make for your organization. Remember – they want to make a difference with their giving – show them how they can do just that.