How to build better relationships with philanthropists

Wealthy donors can be vital to charity finances, offering grants as well as giving up their time to support their organisation and attract further funding.

 

Charities are just as important to donors. They provide an avenue for wealthy individuals to channel their money into projects that make a real difference to people’s lives. Often this relates to a highly personal cause for philanthropists.

 

Latest evidence from the Institute of Sustainable Philanthropy has shown how this relationship can be nurtured and improved to create long-lasting giving arrangements.

 

Here we explore this research further and give examples of how philanthropists and charities are working well together.

 

 

Sustainable philanthropy

 

According to the Institute of Sustainable Philanthropy’s report Meaningful Philanthropy in the 21st Century: The Role of Self,   “philanthropy will be more sustainable” when it is meaningful for both the donor and the community being supported.

 

This urges wealthy donors to relinquish control of their giving to the communities they want to help. It also advises charities to better understand the motivation behind their affluent supporters’ giving. This mutual appreciation gives donations and relationships with charities “substantively more meaning”, says the Institute.

 

The Institute’s research involved interviews with philanthropists. All those spoken to “came to recognise the importance of listening to community voices and having the humility to recognise that the community members were best placed to know what they needed and found meaningful”, it adds.

 

 

Fighting egos

 

But philanthropists must be prepared to “fight with their egos”, warns the Institute, if their relationship with charities is to succeed.

 

They need the humility to adapt their giving and accept communities they want to help are more knowledgeable about how this support can be most effectively delivered.

 

“We would encourage those new to philanthropy to be open to acting in different ways to those originally envisaged,” recommends the Institute’s report.

 

“Doing so can be critical to building trust, and as has been highlighted in many of our cases, for success to be experienced to the fullest, that success must be shared.

 

“The community must jointly own the agenda, and as we have seen, it may be necessary to fulfil additional need that a community deems priorities.”

 

This can be “understandably difficult for entrepreneurs who have led hugely successful businesses using their own leadership, management and problem-solving skills, to then give up control of their philanthropy to a community”, the Institute concedes.

It says: “Many of the philanthropists interviewed described fights with their egos as they attempted to reshape their relationships with their focal communities” adding that “a fight with their own egos is by far the most mentioned challenge that people had to overcome”.

Those wealthy donors who successfully kept their egos in check “were able to do so by ceding a part of their identity to the community and allowing themselves to become part of its collective”.

 

 

Understanding motivation

The relationship needs to be two-way, and while philanthropists need to make concessions, so too do charities, especially in taking time to understand the motivation behind their wealthy supporters’ giving.

 

“Rather than focusing entirely on communities and diverting attention from donor needs, our research also suggests that it may be more fruitful to develop a concomitant focus on donors and understanding who the person behind the giving is,” says Institute Co-Director Professor Adrian Sargeant.

 

“What matters is not whether the community’s needs or the donors’ needs that are served by philanthropy, per se. Rather, what matters is how serving the community’s needs, that it has itself identified, can become an integral part of who donors are.”

 

 

Julia and Hans Rausing and food bank charities

 

Swedish billionaire Hans Rausing’s family wealth was made through his father’s founding of the Tetra Pak food packaging firm. Together with his second wife Julia, he focuses his time on philanthropic projects.

 

Their Trust is now focused on a wide rage of good causes that often react to immediate challenges facing communities in the UK, where the couple live.

 

Most recently this has included helping Food Bank charities meet soaring demand from disadvantaged families amid the cost-of-living crisis. This has seen the couple commit £10m in grants to give to charities and food banks with the expertise and experience to effectively tackle food poverty. Support includes £3.5m to the Trussell Trust’s emergency foodbank appeal, £1.7m to food distribution network FareShare and the launch of a £3.5m Food Bank Fund, which is open to all food banks.

 

 

Sir Tom Hunter and Kiltwalk

 

For the last seven years philanthropist and entrepreneur Sir Tom Hunter and his trust The Hunter Foundation have worked with mass participation walking event Kiltwalk in Scotland. During this time, it has raised more than £37m for over 3,000 charities.

 

Through the arrangement, Hunter tops up any money raised which helps boost participation as fundraisers know their efforts can raise even more money. He also helps Kiltwalk when further support is needed, for example this year he has underwritten a reduction in the sign-up fee, to ensure participation remains strong amid the cost-of-living crisis.