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May 5, 2010

Family foundations—they embody both the best and the worst of philanthropy. I have been a passionate missionary for family philanthropy for nearly 20 years, stemming from both my positive experience with our own family foundation and from the opportunities I have had with my TPI colleagues to help other families take their giving to incredibly fulfilling and highly productive levels. The largest foundation in the world is a family foundation powerfully driven by its donors’ strategic and well-informed visions, and seeking to exercise the weight of its leadership in significant but respectful ways. Yet over two thirds of family foundations have assets of under $1 million and most of those simply use the foundation as a tax-efficient piggy bank for checkbook giving to their favorite charities.
It is the subset of family foundations whose family members are actively engaged, have developed ambitious goals, and use the many varied tools of influence available to them who embody the potential of family philanthropy leadership. Living, breathing donors, many of whom are entrepreneurs with visionary skills, powerful networks of influence, and unorthodox perspectives, are naturals for exercising extraordinary philanthropic leadership. People like Harrison Steans, who used his real estate expertise to develop a holistic neighborhood based approach to lift a community out of poverty in Chicago. (Chapin Hall, with Annie E. Casey Foundation support, has profiled a group of place-based family foundations.) Or Thomas Siebel, who (as profiled in Mark Kramer’s “Catalytic Philanthropy” article that appeared in the Stanford Social Innovation Review) took a thoughtful and well-financed approach to reducing meth abuse in Montana. There’s the Mailman Foundation, all of whose trustees have taken on the mantle of leadership in changing policy and practice in early childhood development. And there is Ken Nickerson, who has allocated $15 million of his family foundation’s assets to launch Boston Rising, an adaptation of the highly successful Robin Hood Foundation in New York City, seeking to inspire and draw out the “money in the woodwork.” These are exemplars of family foundation leadership.
Alas, we have also seen the worst of family philanthropy, where the antithesis of leadership occurs. Saddled by various family dysfunctional behaviors, only exacerbated by the challenges of wealth, too many family foundations don’t come near to reaching their potential as agents of change in our communities. They are too often reluctant to spend the money on getting the kind of family systems, governance, or just strategic coaching and counsel that could help them move beyond a focus on family squabbles to a focus on making a profound difference in the world around them. Just think, what would be possible if they did?
Yesterday’s post: Adaptive Leadership for Challenging Times.
Monday’s post: Philanthropic Leadership—an Oxymoron?