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December 01, 2007


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Jeremy Gregg

Interesting perspective.

From your experience as an advisor, is integrating charity an effective way to help build this family governance structure? What can "charities" themselves do to position themselves as a resource to such families?

These are, of course, some of the core questions that we keep addressing in various discussions... so the questions have been answered, in some form or fashion, in a variety of your responses. I post them not because you have not answered adequately, but because it is still such a struggle to put these answers into practice.

Doing so will determine the degree to which organizations like mine are successful over the next generation, so it's critical that we continue the discussion.

Jeremy Gregg, Director of Development
Central Dallas Ministries


Part of what family governance governs are the entities the family owns or controls. These may include a family foundation. Within the governance structure family members are given different roles. Read the article again and listen to what Caroline says about the difference between working with first and second generation wealth. Entrepreneurs get complex ideas quickly and make rapid decisions.She characterizes the second generation as "complainers." In the family governance structure philanthropic roles may be given to help prepare heirs for more responsibility, to teach character and family values, to get heir used to working with advisors, and also to shut them up and fob them off while the real family wealth is managed by others.

Also, take a look at the post on Bessemer trust from the above perspective. Imagine how demotivating it might be to a young social change heir to find that her money and effectively her life were in the hands of fellas like these, who are there to serve her, but not really to take direction, perhaps, not unless she takes things into her own hands and gets active. Even then she may be working against the family governance system with its committees of elders, siblings, cousins and advisors.

These thoughts may be relevant to those of us who work for social change, since second and following generations tend to be more progressive than the founding generation.

Now, check out Tracy Gary again, Momentum, Threshold, Tides, Resource Generation, Foundation Exchange, The Inheritance Project, and Bolder Giving with all this in mind. What you will see is a quiet group of second and following generation progressive funders for which the issues of philanthropy, family governance, and infantlization by advisors are key issues.

What the advisor considers a "complaining heir," might be better be considered a client who has been ill-served, in part because of the culture clash between the world of business, law and finance, and the progressive, social justice, culture to which the heir may belong.

Not sure what you do with this, but it is good to understand the lay of the land, and the motivation of funder tribes.

You might check out also the posts on Sharna Goldseker to see how your own Gen Y age mates are working through these issues - better than the prior generations it seems to me based on what Sharna says. The Gen Y's are using the net to raise their own consciousness. They will be tough clients for the bigshot trust company and advisory firms who try to "handle and process" them.

Jay Hughes is a good source for family governance too. That is his field.

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