CHARITABLE PLANNING

Elizabeth Wong

Mission statements are important for foundations , but they ’ re most effective when allowed to evolve .

ANY WEALTHY FAMILIES AND THEIR PRIVATE foundations benefit immensely by declaring a mission that specifically lays out their charitable activity and its intent . While it ’ s not required by the IRS , a mission statement can help a foundation prioritize its initiatives and allocate resources efficiently , track its impact and identify areas for improvement over multiple cycles of grant-making . That way , families can attract and engage the best-fit donors , grantees , volunteers and other stakeholders .

Through many decades of work with private foundations , I have learned that the most effective way to craft a charitable mission is through an evolutionary process that defines a foundation ’ s general direction but allows room for growth .

With your encouragement , your clients can revisit and adapt their mission over time as they gain philanthropic experience and grow their foundation . For example , in the first year a client creates a foundation , they may choose to have a purposely broad mission statement , perhaps one that reads like this : “ We are dedicated to improving the health and well-being of our community ’ s residents in need .” Such a broad approach allows them more time to choose a specific focus later .

Several years on , as they work with partners ( for example , social services departments ) to understand and address the pressing needs of their communities , the family might discover that their most meaningful impact has been made through certain programs , perhaps those for young children . In that case , the foundation would modify its mission statement this way : “ We are dedicated to improving the health and well-being of our community ’ s young children in need .”

Now let ’ s assume it ’ s 10 years later , and the foundation is serving children through a variety of projects . As their knowledge base continues to expand , the family and its foundation will be able to further hone their approach and identify specific areas where they want to effect change . Let ’ s say they are focusing more on mental health . So the mission statement becomes even more specific : “ We are dedicated to improving the mental health and well-being of our community ’ s young children . We support efforts for early assessment and intervention , therapy and increased public awareness .”

This approach is informed by the foundation ’ s unique experience and leaves room for additional shifts if it has achieved compelling results from current programs , identified new ways to create impact or both .

Tips For Mission Development

If your clients want to articulate a mission for their family philanthropy , here are seven tips to help them land on something that will inspire others without being permanent or limiting .

1 . Take Some Time

There ’ s no rush . If a foundation is unsure of where to focus its charitable efforts , it can begin by supporting a wide variety of causes to find out what really motivates and excites its leadership .

2 . Involve The Next Generation

If a foundation is expected to operate beyond its current generation , the family should involve younger members in mission development . Advisors can play a key role in facilitating those connections . By engaging the children , the family and foundation will likely increase the next generation ’ s interest while also gaining new perspectives and ideas .

3 . Whether Brief Or Detailed , Be Clear An effective mission statement can be very brief or detailed . Either way , it

SEPTEMBER 2023 | FINANCIAL ADVISOR MAGAZINE | 21