Higher degree of philanthropy

Despite the tough economic conditions, philanthropists continue to support and invest in projects and communities designed to help others. But generous benefactors are now looking for measurable performance benchmarks. According to Bertrand Gacon, philanthropy adviser and head of impact investing at Lombard Odier, more and more philanthropists - including those in Asia - are turning to active or strategic philanthropic activities, instead of straightforward charitable donations. 'These days, it is less of a case of simply signing a cheque. We notice more philanthropists looking for monitoring reports and score cards to measure the impact of their donations,' says Gacon. On a global scale, he says philanthropic activities remain strong with a number of philanthropists stepping up their efforts to help social enterprises impacted by the global financial crisis. The Swiss private bank has a dedicated team to assist clients with philanthropy strategies. 'In Asia, as wealth continues to surge, relationship managers at private banks will need to expand their knowledge of how philanthropy works,' says Gacon. Under Lombard Odier's Fondation Philanthropia umbrella, it acts as the central administrator for all clients' donations, with planning and advisory services rolled in. Fatiah Burkner, senior director at Lombard Odier Darier Hentsch Trust Japan, says that philanthropy advisers need a wide range of skills. 'Clients' philanthropic interests can include climate change issues, education, helping street children or addressing issues associated with a specific illness,' says Burkner, who started at the Bertelsmann Foundation in Germany. Burkner says that among the skills required, listening to what a client wants to achieve is extremely important. 'Just like helping clients with an investment, you need to understand your client's profile, motivation, values and aims,' she says. Burkner adds that philanthropy advisers need strong analytical skills and project management capabilities to screen their client's proposed philanthropic activities. It also helps if philanthropy advisers have knowledge and experience of working with non-government and not-for-profit organisations, she says. 'Like stocks and bonds advisers, philanthropy advisers need to understand the logic that promotes social change, including what the triggers and leverage points are,' she adds. 'You also need to know how to handle unpredictable requests, how to ask the right questions, access networks, talk to NGOs and experts,' says Burkner, who has also worked at the Centre for Social Investment at the University of Heidelberg. Furthermore, according to Burkner, philanthropy advisers need to earn the trust of both their clients and the enterprises their clients wish to help. 'The work is rewarding and challenging, but you would not survive long without a large amount of passion,' says Burkner. Cynthia Lee, executive director of Wealth Advisory Group at JPMorgan Private Bank, says the bank has a team of experts that offer clients and their families innovative philanthropic advice. 'We have more than 50 years of experience in assisting our clients with philanthropic endeavours. Each member in the team is a senior adviser who has, on average, 15 to 20 years of experience in assisting clients with global initiatives and opportunities,' says Lee. She says a team of senior investors also manages endowments and a foundations group that tailors JPMorgan's investment strategies to not-for-profit organisations. The team adopts a fiduciary mindset, embedded with risk management culture, and has a dedicated focus in working with endowments and foundations in the US, and globally, Lee adds. David Pinkerton, chief investment officer at Falcon Private Bank, says philanthropic strategies and estate planning are one of the most personalised aspects of the wealth management industry. Pinkerton says that across the Asia Pacific, the pace and magnitude of wealth formation has been on a scale and breadth that has rarely been accumulated by one class of people in such a short period of time. As a result, the notion of philanthropic initiatives is now becoming an important issue for the wealth management industry. 'We recognise that philanthropy is a growing social phenomena [particularly in Asia] and that it is a high-touch service proposition for a wealth manager,' Pinkerton says, adding that the desired philanthropic purposes are numerous and client specific, so choosing the right platform is key. There is a huge variation in areas of assistance, he adds, from education to healthcare, food and nutrition, the environment and religion.