Helping Funders Make Good Decisions

by Amy Rabbino

Helping funders make good decisions is not just a grant-making transaction. As an adviser to philanthropic families, I’ve come to learn that effective philanthropy has a double bottom line: donor satisfaction and impact for the greater good. Key to successful relationships with philanthropists is a significant investment in listening and engaging the donor (or donor family) in a process that elicits the donor’s personal objectives and motivations for giving. Beyond any expertise in specific areas, analytic insight, vision, or conviction, listening may be the most important skill for an adviser to philanthropists.(1)

While the obligation of tzedakah is deeply felt by many donors, donor satisfaction also plays a motivating and self-reinforcing role. While that satisfaction is, of course, vested in creating meaningful change in the world, rarely does a donor continue to fund a project that doesn’t resonate on a personal level. As an adviser, I use numerous tools to help funders explore their personal aspirations and identifications, family history and legacy; I help them engage the next generations while considering the values to be transmitted, as well as their methodology of giving.(2) Developing this understanding of the donor’s motivation and sense of purpose is instructive in an arena that is not wholly empirically based: Donor-directed philanthropy is an art and not a science.

As an adviser within a Jewish community federation, I work to inspire philanthropists to give Jewishly and to fund communal priorities. Philanthropists working with Jewish community foundations have the benefit of being informed about community challenges, priorities, and initiatives, but they are not bound by them. Donor-directed giving operates like a private philanthropy working under the umbrella of the organized Jewish community. Granting a plurality of funds to Jewish causes is not a given, even among this population.

As a best practice, philanthropic service professionals connect philanthropists to appropriate educational opportunities. Some donors want help developing financial competencies (particularly for children of wealth); others want to study a particular issue. Connecting funders to experiential and learning opportunities across the spectrum of philanthropy, finance, the nonprofit field, leadership, and Jewish life helps them develop greater skills and interest. Connecting philanthropists to each other and to knowledge in the field is also crucial in order to facilitate collaboration and impact. Peer group learning (by age cohort, gender, funding area, or magnitude of giving) is often particularly effective.

In order to help donors make not just “good decisions,” but “good-for-the-Jews decisions,” they need to have positive, meaningful Jewish experiences. Those experiences motivate donors to direct their dollars Jewishly and to consider the compelling needs, granting opportunities, and big ideas in the Jewish world. While many funders arrive with such experiences, in some cases a component of our support is to develop a philanthropist’s Jewish engagement and knowledge. We refer family members to programs that promote leadership, as well as to service-learning programs and to religious, volunteer, social, artistic, and learning opportunities. We suggest travel to Israel or other Jewish communities, and we help families network with the Jewish community and encourage them to articulate the Jewish values guiding their philanthropy.

Effective philanthropy focuses on outcomes in the world – a convergence aptly captured by Charles Bronfman and Jeffrey Solomon in the title of their book, The Art of Giving: Where the Soul Meets a Business Plan. To the public impact bottom line, an adviser must bring research and best practices in the field and subject area; the adviser helps to make matches between nonprofit organizations and collaborative funders; to guide funders in the discipline of philanthropy; and to offer inspiring opportunities and initiatives in light of the funder’s risk tolerance, funding horizon, and other methodological considerations. It’s also the adviser’s role to clarify what the investment of certain philanthropic dollars will garner, and to maximize the effective deployment of non-financial resources such as leadership, advocacy, and social capital.

Funders seek help in understanding the philanthropic terrain – particularly with regard to multi-generational family philanthropy. They must navigate a number of philanthropic trends: the longer life span that allows for as many as four generations to participate in a single family’s philanthropy, the notion of giving while living instead of leaving one’s assets to be disbursed after death, and the younger generation’s lack of attachment to traditional institutions.

Other trends include the decline in umbrella giving and the increase in donor-directed funds, plus the advent of new methods of giving, including giving circles, online giving, results-oriented philanthropy, and venture philanthropy. Funders must also deal with the blurring of the lines between the for-profit and nonprofit sectors and with the way technology has transformed the currency of philanthropic data, information, and action.

There is more to being an effective philanthropist than granting money. And the role of a successful philanthropic adviser starts with listening to what is at the heart of the act of philanthropy for a donor, moving through a range of technical skills and expertise, and ultimately helping them to hear the needs of the community and to act with impact.

Amy Rabbino is director of philanthropic services for the San Francisco-based Jewish Community Federation and Endowment Fund, working with individuals and families in their philanthropic endeavors. In addition, she convenes current and next-generation funders for meetings on best practices and innovative grant-making. She is also an evaluator for Slingshot: A Resource Guide to Jewish Innovation. A graduate of the Wexner Heritage Fellowship leadership program, she holds a doctorate in English from the University of California, Santa Barbara.

(1) I thank my mentor, Phyllis Cook, for teaching me many of these lessons in philanthropic advising in the Jewish world.
(2) I use many of the tools developed by the Andrea and Charles Bronfman Philanthropies’ 21/64 division to this end.

Reprinted with permission from the October 2011 issue of the journal Sh’ma, as part of a larger conversation about philanthropy and tzedakah.