The report has revealed that families are leveraging the strengths of philanthropy and the family office for greater effect in the community and more satisfaction for themselves.
The study which was sponsored by Threshold Group, and had Family Office Exchange as a partner in the study, estimated that around 5,000 single-family offices operate in the US, and that a large percentage support philanthropic activity.
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Some of the advantages cited for enhancing a family’s philanthropy through a family office structure are integration of functions and services, economies of scale, efficiency for family members and external vendors, expanded capacity for mission-related investments by the foundation and alignment of the family’s shared values.
In addition, both family office leaders and foundation staff members were found to value next-generation education, though neither side spent much time in this area.
Meanwhile, the challenges associated with managing philanthropy through a family office structure included different cultures of business and philanthropy, varying measures of success and different terminology, them/us mentality, competition for the attention and resources of family members and complicated and counterintuitive IRS restrictions on interactions.
"We found that managing philanthropy through the family office can be a very effective approach for families, particularly if there are multiple branches to the family and if they are using a number of charitable vehicles," said Virginia Esposito, president of the National Center.
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