Philanthropy maintains tradition and brings family values to life. In a changing world, it helps a family secure its legacy – but the ways to practise philanthropy are evolving.
DBS Private Bank’s new research into family offices finds ultra-high net worth individuals putting a new emphasis on philanthropy, as families recognise the vulnerabilities of a post-Covid world and embrace the ideas of a new, conservation-minded generation. They are working more closely with the causes they care about and making connections to provide a deeper level of support.
In one example, Mary Ann Tsao explained to us how her family office in Singapore initially adopted a “do no harm” principle, such as excluding investments in companies whose operations might damage the environment. Today, she and her siblings – the children of shipping and real estate entrepreneur Frank Tsao – are dedicating a growing share of their portfolio to strategic, catalytic investments in areas such as human longevity and education.
Meanwhile, Raj Vaswani, Board and Investment Committee member of the IshK Tolaram Foundation in Singapore and a member of the Tolaram family, says his family’s venture-philanthropy activity supports impactful social enterprises and can help to ensure their business models are financially sustainable. “One way we reduce the risk is by working collaboratively with organisations that have expertise in a specific sector,” he says. “These partner organisations may be able to provide support services to maximise the social impact that the enterprise is trying to make.”
In the US, making connections is something that philanthropist and impact investor Anne Deane considers essential to the restoration, conservation and rewilding work she supports. “We like to catalyse not just using our chequebook, but also our wealth of knowledge and our help in developing a partnership with the entrepreneur that we're investing in,” she says. “That could be in the form of an external consultant, our own contacts, or by helping market their product.”
The conditions to thrive
Some families are playing a role in establishing supportive networks from scratch. Liesel Pritzker Simmons, who co-founded Blue Haven Initiative with her husband as a single-family office focused on impact investing, explains how the hands-on approach they take towards their grant portfolio extends beyond the injection of capital.
“We do a lot of early-stage investing in tech companies in sub-Saharan Africa,” she says. “One of the biggest bottlenecks these companies face is that they’re growing so fast they need to hire for specific roles that they don’t even know exist yet.”
The problem is exacerbated because, in many start-ups, “HR is usually the last team that gets hired.” With that challenge in mind, Blue Haven Initiative has become a key supporter of an initiative in Africa to develop strategic HR teams and nurture local talent experts.
Direct engagement also plays a key role in many impact investing strategies. Ditte Lysgaard Vind is an angel investor who invests in European start-ups focused on the circular economy, to which she provides additional guidance based on her personal experience.
“There are a lot of skilled people coming into circularity from other industries,” says Vind. “As they can be new to this space, I can add in-depth knowledge of the advantages and the barriers in the landscape, saying what has and hasn’t worked so far.”
The long road ahead
Along with connections, experience and capital, wealthy families can offer the assurance of long-term commitment to a positive cause. Given the often-glacial pace of real change, this aspect is vital.
Leena Dandekar, who set up the Raintree Family Office with her children, is heavily involved in conservation work in rural India to enable a balanced model through which humans and nature can both prosper. She understands that such an ambitious goal must be long-term. “We have a patient programme that is designed to be seven to nine years,” she says. “We are looking for slow, steady growth.”
Anne Deane believes that defining the goals of impact investing and philanthropy from the outset is critical to long-term viability. “We believe in having tight fundamentals and going deep to move that needle,” she says. “But our biggest challenge is finding like-minded organisations and companies and working with them to restore our wild places. Everything takes longer than you think.”
