Family philanthropy is rooted in legacy and tradition, making it unique in the philanthropic community. Every decision a family foundation makes is informed by its internal family dynamics. From selecting grantees to updating software to onboarding the next generation of leaders, the family ultimately decides every choice. Moreover, no other form of grantmaking is centered on tradition more than family philanthropy which centers it as the guiding principle of its giving.
But what are traditions? Traditions, in short, are a foundation’s customs that reflect and extend its legacy, values, and culture. Traditions often serve as the guidepost for a family foundation’s giving, the litmus test of whether grants fulfill the foundation’s intent. The founder usually sets the foundation’s intent and purpose based on their interest, desires, and passions, such as the arts, science, or the environment.
However, as a foundation matures, it can find that its legacy and traditions can become less relevant, restrain grantmaking, and hinder the next generation’s engagement. For instance, in one family foundation, the current Executive Director is a family member who is torn between honoring the legacy of his “grandpa,” whose single-focused interest is in youth scholarships. This next-gen leader feels stuck because he cannot evolve and expand the foundation’s current grantmaking because he feels obligated to honor his grandfather, who is still very active. He would like to move forward while preserving the family’s spirit and ethos.
While every family has its own set of traditions that touch the heart and hold the family together, sometimes holding onto traditions comes at the expense of limiting a foundation’s impact and making it irrelevant in a rapidly changing world.
A Time of Transitions
Our lives have been shaken to the core for more than two years. As we gradually emerge from the pandemic, philanthropy must navigate all the external and internal transitions that have occurred during this moment of crisis.
Transitions refer to all of the changes that family foundations are being called to respond to, such as increased assets upon the death of a founder, leadership experiencing burnout, a younger generation rising and ready to lead, and many other developments. Family philanthropy can look at transitions as hurdles to overcome or instead as a time when almost everything — from internal organization culture, grantmaking, family dynamics, and relationships with grantees – can be reimagined as an opportunity for possibility and courage.
During the pandemic, so many family foundations embraced the moment of transition and pivoted quickly to distribute funds to communities in need. We saw family philanthropy simplify application procedures and grant reporting, apply a trust-based approach to its giving by incorporating community members’ voices, and normalize multi-year, general operating support for their grantees. On another level, in the coming years, family philanthropy is poised to change as assets are estimated to grow substantially when founding family members pass away. It is no small transition to go from a relatively small family foundation of $25M to one of $100M.
The implications of all the transitions that have occurred and those that will arrive soon are enormous. Will family philanthropy get lost in the tensions — the push and pull — between their long-standing traditions and emergent transitions? Will families return to the “old ways” defined by generations past in honor of their legacy? Or will they choose to adapt to the changing values and priorities of a new world?
Transitions are an opportunity to reconsider our traditions. It’s possible and necessary for families and foundations to reimagine their inner spirit and culture to serve better the moment we are in and our communities.
Because traditions and transition are an integral consideration for family philanthropists, this year’s SCG Family Philanthropy Annual Conference will be devoted to the theme of Navigating Transitions and Redefining Traditions. What does it mean to challenge the traditions — and family members — that created the foundation’s wealth? What does it mean to redefine a foundation’s identity while shedding the values and practices no longer serving our sector? We will deeply examine the tension at the heart of traditions and transitions to imagine what is possible when these ideas coexist. Our luminary speakers and community leaders will help family funders reassess their legacies and leverage change to realize their visions for equity.
I invite you to join us virtually on June 7th and in person on June 9th to learn from SCG’s family philanthropy network. After so many months apart, I hope I am excited to reconnect with our community and be inspired by the creativity and resilience of SCG’s family philanthropists.