The profession of independent philanthropy advisor is a relatively new one. WISE draws its name from the acronym derived from the marriage between wealthy individuals (WI) and social entrepreneurs (SE).
WISE defines its vocation as to accompany donors and their families in fulfilling their philanthropic aspirations. FOG discussed the challenges of meeting client expectations with Etienne Eichenberger, Managing Partner, and Maurice Machenbaum, Partner, WISE Philanthropy Advisors together with Anne Prenez, Founder & Principal, Asia Family Wealth & Philanthropy Consulting Limited and Associate of Global Partnership Family Offices, who offers philanthropy advice in Asia in association with WISE.
How do your clients find you? Do they tend to be referred by other intermediaries?
Etienne Eichenburger: In most cases they come direct to us. We often find that people are looking for interesting and engaging conversations about philanthropy rather than formal presentations. That has been our path. That said our experience is that intermediaries are very helpful when they also have an interest in the relationship. We’ve been able to work with some intermediaries better than others. The fact that we won the STEP Award for our philanthropy advisory team is recognition that we have been professional in approaching trusted advisers and intermediaries.
Do you have any partnerships with intermediaries?
Etienne Eichenburger: We’ve been in the market for 10 years and interestingly enough that was the approach we took for the first few months. It has not been the case since then. We have lots of informal agreements, but the truth is that when you have formal agreements with intermediaries, there are two constraints: one is longevity – often large institutions need you to have been around for years and ‘philanthropy advisor’ is a relatively new profession; and secondly, they are often also looking for exclusivity. We have developed a very strong network with institutions that are alike in their mind-set. We are not exceptional in that regard.
When new clients come to you, where are they usually in their philanthropic journey? Are they starting out or looking to change their approach?
Maurice Machenbaum: Really both. There are people who are looking to start giving, often with the ambition of involving other members of the family, and they want to go about it in the right way. And we have experienced philanthropists who have been very generous in giving money away for years and then they realise that they don’t really know where the money went and they are rethinking their philanthropy.
That also happens with people who have been very active workwise and so perhaps more reactive in their philanthropy. When they retire or have more time, they start becoming more proactive and seek to become much better informed about the impact of their philanthropy.
Do they tend to have a roadmap for what they want to do or are they willing to see what others are doing in the field they want to support?
Maurice Machenbaum: Most of the time people are not that specific. They want to help in broad areas. They may favour particular regions and they may have specific interests, but not specific projects. We have developed a methodology that helps them to answer questions about their philanthropic aspirations. There are several issues to confront beyond geography. Do you want to support a large or a small organisation? How do you want to provide your support? How much personal involvement do you want? There are different ways to ‘operationalise’ philanthropic intentions.
You mentioned a bit earlier the question of impact. How much detail do your donor clients want in that regard?
Maurice Machenbaum: The definition of impact is different for each and everyone, including specialists. It is a bit of a buzzword. The important thing is that most of our philanthropist clients want to be well informed and are keen to visit the projects they support together with us.
That way they are able to get a real understanding on how their philanthropy is transforming the lives of the end-beneficiaries. It is less the technical aspect of impact that they want, though of course they receive all appropriate reports. We have developed very powerful tools that our clients over the last 10 years have helped us to customise to their needs.
Anne Prenez: Even though impact evaluation – and philanthropy in general – in Asia is still in its infancy, it is also becoming a growing concern for donors wanting to make a meaningful difference, especially the younger generation, who are more familiar with the western approach towards philanthropy and keener to adopt a more professionalised and strategic giving. It’s an area where advisors can add value to clients as they can set up opportunities for them to see first hand how their donations are having an impact on beneficiaries’ lives.
Etienne Eichenburger: If I were to put it in one sentence, I’d say the interest in impact varies, but the appetite is growing. Despite the diverse understandings of how impact should be defined, it is a key component in building trust. People realise that doing philanthropy that way is different from simply supporting a large charity.
Are they interested in feedback from the beneficiaries in how they’re perceived as donors?
Etienne Eichenburger: Absolutely. We have a very good example from Vietnam. We helped support a relationship for one donor with a very successful organisation working on job integration. The partner organisation was in fact working with us for the first time with large private donors. In the past they would receive funding from institutions and foundations. Working with two individual donors was a huge learning curve for them, but we were able to to create a stronger organisation with greater capacity to engage in the future with private donors. The appetite to learn was mutual – very much so.
Maurice Machenbaum: A philanthropy advisor can know and understand the concerns of both sides. That creates value.
I imagine that in some cases, you’re working with families rather than individuals. What happens when families don’t agree about the approach to take?
Anne Prenez: I work mostly with families. That can, of course, happen, especially between generations, not so much between siblings.
Often the differences are in how they would approach giving rather than what they would support. It doesn’t mean that the younger generation is more charitably minded, but they are interested in more innovative methods with a stronger emphasis on impact, research and due diligence. They also may have a more hands-on and entrepreneurial approach to philanthropy with a focus on sustainability and seeking to improve efficiencies. A lot of families work by consensus, especially in Asia. It is more a question of balancing the family legacy and honouring what has already been done in the past with seeking greater impact. It is a case of respecting the lessons learned and family traditions, but drawing on the new tools available.
Are there any regional differences in family preferences, for example between European and Asian families?
Anne Prenez: There are very wide differences in that regard, even within Asia. In Asia
and Europe there are some similarities in that philanthropy is more discreet and more of a family affair. It is seen as a means of transmitting and sustaining family values. In the US, individual philanthropy is more rooted in the culture and the approach is more public. American donors feel a strong duty to give back to their community and society. In Asia, because wealth is relatively new, donors usually prefer to remain anonymous and giving is more informal. The younger generation that have been exposed to western styles of philanthropy may, however, want to be more overt.
Etienne Eichenburger: What matters when you are a philanthropy advisor is to match the process to the family. Some families have – or tolerate – more conflict than others. Sometimes you might promote an initiative that allows a ‘federal’ approach; for example, setting up an intranet that allows the members of the family to be very transparent with each other. But philanthropy is not decoupled from the other issues that families need to address in how they organise their affairs. An advisor needs to have a good toolbox that works with both divergent and consensual family approaches. We also see differences between families whose members consider themselves citizens of the world and those who are more locally rooted.
Maurice Machenbaum: Many of our clients are business owners. As their businesses have grown, they have developed more and more interests in other parts of the world. There is a strong tendency for global giving among such clients, though not necessarily to the exclusion of local causes.
Anne Prenez: I agree, but in Asia where most of the world poverty and environmental challenges are concentrated, there is a widespread concern by donors to look to solve issues locally. If you look at Hong Kong, for instance, a third of donations originating there are dedicated to funding China projects.
Your Asian office is in Vietnam rather than Hong Kong or Singapore. Why is that?
Maurice Machenbaum: We are very hands on. When we decided to open an office in Asia, we based ourselves where projects happen rather than where the money is. In addition Ho Chi Minh City is an excellent base for access to other countries in the region in terms of flying time. Our relationship with Anne, who is based in Hong Kong, also allowed us to leverage her expertise across the region.
