Developing a Giving Strategy for the Year Ahead

The start of a new year often reinvigorates philanthropists’ enthusiasm to develop their charitable giving. If your client has opened and funded a donor-advised fund (DAF), they can begin recommending grants immediately. While grantmaking with a DAF is a simple process, you can help your clients foster greater philanthropic impact by helping them define a giving strategy. Here are five points to consider as you help your client develop a highly effective giving strategy.

Set a clear budget.

If your client undertook charitable giving last year, look back to see how close they were to their charitable goals. Do they want or need to modify them for the coming year? While thinking about this year, keep in mind general targets for the next five or even 10 years – depending on their goals – and whether other generations are involved in your client’s philanthropy.

Choose the causes.

Philanthropic activity is often led by personal passions and interests, and these can develop year on year. Check in with your client annually to determine whether causes they previously supported remain relevant to their interests and philanthropic goals. Guide this conversation by asking your client questions like the following:

• Do you still feel a strong connection to the causes you currently support?

• Was there a cause you discovered over the past year that you would like to support going forward?

• Do you feel that your giving is having the impact you had in mind?

• Which philanthropic goals do you want to achieve during your lifetime and which goals may be achieved as your legacy?

Think about the ‘where’ and ‘who’.

Is your client drawn to a specific location – neighbourhood, region, country or continent – where they would like to focus their support? Some donors will support causes linked to locations they have a personal affinity with or have visited, while others will also donate to causes in regions they have no direct connection to, but nonetheless feel compelled to support. Geography-focused philanthropy is a popular form of giving, but some donors may prefer to focus on specific demographics they would like to support regardless of the geography, like children, women or the elderly. They may also want to support a specific community that faces insurmountable challenges, like people who have historically been marginalized, regardless of age or location.

Learn and refresh.

While some donors may prefer to support a specific group of charities each year, others may prefer to support new causes and organisations – and there are others still who may prefer a middle-of-the-road approach. In all scenarios, it is advisable that either you or your client reviews an organisation’s impact report before giving, to ensure that the organisation’s methods for achieving an impact align with your client’s philanthropic values and giving goals. Websites, annual reports, and sector publications can provide insight into a charity’s core project areas and what they have accomplished to date. If the impact doesn’t feel like what your client set out to achieve, reflect on why, and use what you have learned to inform the development of your client’s giving strategy.

Get started.

There is no better way to learn than by doing. Experience will be an excellent tutor; your client will gain a clearer understanding of their philanthropic values and goals as they actively engage in grantmaking. It is not necessary for your client to have their philanthropic strategy mapped out down to the finest detail before they begin recommending grants, but opening the conversation around developing a giving strategy is a vital step you can take to better support your client’s philanthropic journey. Be sure to regularly check in with your client to reflect on what’s resonating with them and be prepared to adapt if necessary. Remember – philanthropy is an ever-evolving journey.

For more information about NPT UK’s DAF, how to develop a giving strategy, or to access online resources, please contact NPT UK and our advisors will be happy to help.

About the Author

John Canady, CEO of National Philanthropic Trust UK, has 25 years of experience working across the business, nonprofit and government sectors. He specializes in creating and managing philanthropic funds for donors and family offices around the world who wish to base their philanthropy from the UK.