My father was an entrepreneur who in the 1980s created a small family foundation to which he named my three siblings and me the successor trustees. Although we knew about the foundation and he had occasionally spoken to us about our possible involvement, we had not worked together in philanthropy. Twenty-five years ago, I was scheduled to visit him and intended to have a conversation about why he had named us as successors and what his thoughts were about the future of the foundation. One week before that visit, he died unexpectedly and the conversation never took place.
Nor were there any documents to indicate his wishes beyond the very generic articles of organization.
My siblings and I looked at the gifts he had made to discover clues to his intent and were unsuccessful. Why hadn’t he used the foundation to make the large gifts to his favorite organizations? If there was a purpose to our involvement after his death, what did he have in mind? What was the larger meaning around his giving, whether from the foundation or other sources?
These were questions the four of us struggled with. Although we came to resolution over the years and feel that he would have been pleased with the results of our work together, we have always regretted that we didn’t have the opportunity to understand his intent through a document or conversations. We feel they would have laid the groundwork for us, for our children and grandchildren.
This experience has informed the work that I’ve done with foundations at The Philanthropic Initiative around legacy and donor intent.
Conversations about the meaning of giving rarely take place during the busy activity of a foundation calendar, but they are crucial for its future. And although “donor intent” is a term that can strike fear into the heart of the recipient of a gift or the successor trustee, thinking about the “why” of a foundation can be interesting for both the donor and the successor.
In our work with clients, especially first and second generation family foundations, there are three areas that they express as being important, two of which can be covered by legal documents. The first is the purpose (or “what”) of the foundation, the second is “how” it will function, and the third is “why” it was created. Donors often do not get past the first two. But it is the third aspect – the “why” – that can create the most interesting conversations, be most meaningful, and most ensure that a foundation continues to serve successfully. It is the “why” that highlights the values, vision and reason for the creation of philanthropy.
For the donors, explaining the "why" by writing a letter of intent is a process that leads to clarification of purpose. It’s an opportunity to explore and reflect on their feelings more deeply than they might otherwise, and is an expression of values and history. It expands the potential for leaving a meaningful legacy, and if shared in advance with successor trustees, it can set the stage for important conversations and can give them the comfort that there will be a real understanding to support future giving.
The stage setting gives successors a personal context for donors’ wishes and helps them feel a greater connection to both donors and mission. For a family, the document itself strengthens a shared sense of history, philanthropic purpose and can be both interesting and inspiring to read. For donors and successors alike, the document and conversation can reduce anxiety about the future and help resolve conflict. Successors can feel confident in moving forward with an understanding of the donors’ values, vision and reason for giving. A letter of intent provides a “window into the soul” of the donor.