Wealth Briefing (link may not work since Wealth Briefing wants money for the info, in the spirit of philanthropy):
Philanthropic investment advice is in demand and will be a core service required of wealth advisors, according to a report commissioned by New Philanthropy Capital, a charity offering investment advice.
Wealth managers need more training in this area but the benefits are considerable, such as new and increasing sources of revenue, strong client relationships and new clients from referrals, the report said.
The report, produced for NPC by wealth management consultancy Scorpio Partnerhsip, says that owing to increased client demand more advisors are offering philanthropy services to their clients. But the lack of training means the range of services is limited and many donors are unaware of the advice available.
The research was based on interviews with 100 private client advisors across Europe, including private banks, multi-family offices, trustees, private client lawyers and accountants, and other specialist wealth advisors.
The report goes on to say that wealth advisors who give philanthropic advice tend to talk about philanthropic vehicles (allowing for continued money management), rather than about how to get the money out from management and into the world via direct gifts and grants. This is not surprising given how wealth advisors are compensated. How, then, do donors get advice on how to make gifts effective in actually making the world a better place? At some point the wealth advisors will have to make room at the table for fundraisers and nonprofits leaders who can partner with them to serve the wealthy person who in turn wants to serve some larger purpose.
Hint for fundraisers: What if the wealth manager saw that the money passing from his or her firm to your organization were going to go into a permanent endowment that the wealth manager would manage? Getting advisors paid is a good predictor of cash flow.
Hint for Donors: It is your money. Ask for what you want. If you want grant-making advice, ask for it. If you want your nonprofit allies at the planning table, so that the money does some real social good, invite those leaders.
Hint 2: For Fundraisers: Educate donors about grant making and about how to work with advisors for social results.
Hint for Advsiors: Game over? Not yet, but soon donors will see through the financial tools and techniques (moving money around inside accounts at the wealth management firm) and will demand that their philanthropic money goes to work sooner rather than later in strategic gifts and grants. If you want to get and keep good clients, don't fight the mega-trend. If you can't offer deep advice on grants in-house profitably, partner with nonprofit allies. What goes around comes around. Advisors who make good partners get a good reputation and good referrals too.