It’s a lesson teachers and parents know well: No two people learn in exactly the same way or at exactly the same pace. And it’s a lesson worth bearing in mind for those seeking to create pathways for family members to engage in a shared philanthropic legacy. Arabella Advisors has worked with families for over 10 years, and we have learned that an important ingredient for success is to allow family members to decide for themselves when and how to engage in the family’s philanthropy.
We love telling the story of Bill Clarke, founder of the Osprey Foundation and our client for the past seven years, who has embraced a very flexible approach with his own foundation—one that has resulted in deep, personal, and satisfying engagement from each of his children and their spouses.
Bill established the Osprey Foundation 11 years ago to empower individuals and communities through education, health, economic opportunity, and human rights in a sustainable way. In the beginning, he didn’t know exactly where he wanted to invest his resources, much less how his three children, who were then in their early 20s, should be involved. “I wasn’t thinking about bringing them on the board right away, but I knew that we had all been involved in mission work, development, and foreign travel, and that they’d be interested in becoming more involved eventually.”
When he first came to Arabella, Bill wanted to better understand both how he could use his resources to find and support solutions that worked, and how he could nurture a foundation that would offer an opportunity for his family to work together and bond over something meaningful. “Philanthropy was all new to me, and I was operating the foundation on the back of an envelope. I hired Arabella to help me adopt best practices, narrow my grantmaking, and to guide me in engaging my children,” he says. Osprey makes use of a highly qualified multifamily office to manage its books and grant execution, rather than centralizing it all with Arabella as many family foundations prefer. “In addition to helping me define my goals and strategies for impact in the issues I care about, Arabella helped me to articulate my intent for the future of the foundation and my goals for the productive engagement of my children and their spouses.” This included guidance on how to develop an operational infrastructure, such as defining the appropriate governance structures and asset allocations to bring the next generation into the fold in a thoughtful and measured way.
With Arabella’s help, Bill approached next generation involvement knowing he had to be flexible enough to allow his children to come to the foundation in their own ways. As many families see, interest in and time to dedicate to philanthropy can wax and wane as next generation members launch careers, settle in new communities, and become parents themselves. “I set things up so that working with the foundation was convenient for them to do when they wanted, but not compulsory,” says Bill. “I wanted my three children—and now their spouses—to understand that they were welcome to step away from foundation work when they needed, and step back in when they were ready.” One daughter exercised that option, resigning from the board for a year to be able to more fully dedicate herself to her career at a critical time.
When thinking about how the kids and their spouses might become involved in the family grantmaking, Bill says he “felt that just throwing philanthropy in their lap was not the right way to go and that there was an amount of education and preparation that would be very helpful to them.” He also realized that it was important for each family member to discover his or her own passions. “I narrowed my own interests to water and interfaith issues,” he says, “but it took a few years of grantmaking for me to determine that focus.” Arabella helped by working with the whole family collectively and also with each individual to help them identify issues they care about and to think about strategic ways they can use their resources to effect change.
To provide practical experience in grantmaking and collaborative decision making, Arabella helped the Osprey Foundation go beyond establishing an individual discretionary grant pool for the next generation by developing a collaborative grantmaking pool that comprises 18% of the foundation’s annual grant budget. The Everyone Pool, as the foundation calls it, is for the next generation to make larger strategic grants. “I’m trying to give the kids the latitude to research and to make grants in areas that they feel drawn to. If I forced them to work in the issues that only I care about, they’d be less inclined to dedicate the time to the foundation,” says Bill.
It’s been rewarding for Bill—and us—to witness that, even as the children and their spouses face the inherent challenges of balancing board work with personal and professional commitments, all six have taken up the mantle of the foundation’s work. “It is wonderful to see that they have taken it very seriously and that they are developing the expertise where they can have impact in the world with the funding that they have, and they will be able to carry on when I’m done,” says Bill.
For the Osprey Foundation, a thoughtful and open-minded approach has been essential to successfully preparing the next generation to continue the foundation’s work. Seven years into our work with the foundation’s next generation members, they are deeply engaged in the issues they care about and are all pursuing significant grants that position them for impact and continued growth as philanthropists. What remains important to Bill is that the next generation members are learning as they go, and that philanthropy is something they engage in because it’s meaningful to them—and not an obligation.
Betsy Erickson provides strategic guidance and operational support to Arabella’s managed foundation clients. Recently, she worked with clients to develop strategies on experiential education and conservation. She also works to enhance board governance structures and engage next generation family members in their family foundation’s work. Currently, she works with Arabella clients who are committed to ending genocide, improving local food systems, conserving the environment, and advocating for human rights.