“WEALTH is not to feed our egos, but to feed the hungry and to help people help themselves.” – Andrew Carnegie
ACCORDING to Wikipedia, philanthropy etymologically means “love of humanity” in the sense of caring, nourishing, developing and enhancing “what it is to be human” on both the benefactors’ (by identifying and exercising their values in giving and volunteering) and beneficiaries’ (by benefiting) parts.
The most conventional modern definition is “private initiatives, for public good, focusing on quality of life.” This combines the social scientific aspect developed in the 20th century with the original humanistic tradition, and serves to contrast philanthropy with business (private initiatives for private good, focusing on material prosperity) and government (public initiatives for public good, focusing on law and order).
Philanthropy is transformative and based on family values.
Family businesses practice philanthropy for reasons based on values and wise business strategies. It is an extension of the family enterprise that reaches out and tries to respond to the depressing issues in the community and on a larger scale, to the world — giving opportunities for the underprivileged to gain better access to resources and develop as productive individuals.
It is through philanthropy that we see how family businesses selflessly contribute to help change lives in different ways – scholarship grants, livelihood trainings, housing projects, medical support, feeding programs, benefit concerts and other sorts of fundraising events. Recently, we have witnessed the amount of support (monetary and/or in kind) from many companies including family businesses that poured to help
the people of Leyte and neighboring provinces devastated by super typhoon “Yolanda.”
The act of philanthropy is truly powerful and transformative.
Philanthropy anchored in family business objectives, shaping the vision and mission.
Every year, tons of requests or applications for grants, sponsorship or donations are received by family businesses. Once the news spreads that a particular company is active in philanthropy, more and more people and groups from various backgrounds and
causes (non-government organizations, for example) would vie to seek for support.
There are a lot of them out there, and many are really good with what they do! If all are deserving of support, it would not be a question of whether or not you are giving the support to the right individuals or groups anymore, rather a question of which ones resonate with what the family business is focusing on.
The problem is that as much as any family business would like to spread its resources, it may not be sustainable. So, it is really important that the philanthropic efforts of the family business be based on certain objectives. What are the demographics which the family enterprise has to focus on?
In this way, the portfolio for this purpose would be developed strategically. Always go back to how the family business sees itself attaining both in the short and long term. Which causes are really close to the hearts of the members of the family? Do these causes relate to the vision and mission of the company? The family business can concentrate on particular areas — environmental protection, education, health, etc.
Figuring out which beneficiaries from a long line of hopefuls is truly a difficult
task and may be disheartening for the applicants, but of course, when you are in a budget like how it is always in business, you need to consider what the family business prioritizes to support, so that the philanthropic efforts would attain depth and not scattered and all over the place. A little here and a little there, could be interpreted as lacking real commitment. Select which serves the objectives, vision and mission of the family business, stick with it and make real impact through flagship projects.
Family businesses need to have a structure for philanthropic purposes.
The family business would benefit from developing a systematized structure especially when it comes to decision-making. Identify who among the members of the family (including non-family members if there are) are going to be responsible with particular projects and discuss how processes for granting donations or monetary support will be made. If you think anyone could just decide in the family in terms of releasing finances or other material support, it would be difficult to trace the development of projects and the expenses made. Better establish structure and rules.
(To be continued)