In fact, when families think about building a positive reputation, they usually think about philanthropy and giving to charity. Stonehage Fleming recently found that 19% of high-net-worth families say they manage their reputation by engaging in philanthropy.
But if giving to charity isn’t managed – and communicated – in the right way, it risks exposing the family to reputational damage rather than the opposite. It needs to be done in the right way.
Giving money to charity matters less than you think
It’s not uncommon for families and entrepreneurs to think philanthropy is the key to unlocking – and maintaining – a positive reputation. Many also view philanthropy as the best way of recovering their reputations.
The facts aren’t quite so clear. Earlier this year, we conducted the UK’s first UHNWI Public Barometer.
The Barometer revealed that while philanthropy is an important component of a families’ reputation, it was far from the top factor.
- Just 38.6% of people said that giving money to charity would make them think more positively of a family
- Only 15.2% said that not giving money to charity would make them feel more negatively towards a family
Giving money doesn’t matter as much as many families think – and there certaintly isn’t an expectation amongst the public that families should, or will, give to charity. They respect that a families’ money is their own, and they can choose how to deploy it.
The public can tell if a family are not giving for sincere reasons
But while the upsides of philanthropy for a families’ reputation might be overestimated, the impact – or risks – or getting it wrong are often underestimated.
If a family is seen to be giving to charity for the wrong reasons – or their charitable endeavours are not sincere – they run the risk of damaging their reputation rather than the opposite.
Philanthropy must be heartfelt and be aligned with the family’s mission, motivations and values.
At Transmission Private, we like to say a family’s charitable giving must be genuinely ‘meaningful’ – otherwise it risks doing more harm than good.
Philanthropy must be heartfelt and be aligned with the family’s mission, motivations and values. Any gifts or charitable engagements should feel natural and be in keeping with the overarching mission of the family.
The family must find an issue that is close to their heart or aligned with their business, and that connection must be able to be easily made by external stakeholders.
Case study: The Sackler Family
An example of how philanthropy can go terribly – and potentially unfairly – wrong hit the headlines this year.
The Sackler family generated pages of newspaper coverage around the world after several high-profile arts organisations rejected their donations. This came off the back of negative coverage of their role – through the family business, Purdue Pharma – in producing the opioid painkiller, OxyContin.
At Transmission Private, we like to say a family’s charitable giving must be genuinely ‘meaningful’ – otherwise it risks doing more harm than good.
Subsequently, a number of journalists started to query the sincerity of the family’s giving, questioned their motivations, and started speculating that they were giving only to ‘recover’ their reputations for being associated with the opioid epidemic that was plaguing the USA.
This situation was not helped by the fact that the Sackler family had become well known for gifting large sums of money to arts and cultural institutions, which led to galleries taking the name of the family. There was a risk that their gifts looked like not much more than signing large cheques in exchange for naming rights.
It is undoubtedly the case that the Sackler family’s gifts were driven by a desire to extend and expand the reach of arts to people globally, but despite the best of intentions, the family hadn’t undertaken the necessary steps to make their giving look and feel sincere, heartfelt and meaningful.
Communicate your impact
Much giving from the high-net-worth community understandably goes unnoticed and under the radar.
With Corporate Social Responsibility (CSR) programmes run by businesses, companies view and leverage CSR as an opportunity to raise brand awareness in return for giving to a worthy cause.
Families are not motivated in the same way, and there’s nothing wrong with that. They see philanthropic giving as a duty and do so for positive, heartfelt and meaningful reasons, rather than for raising the profile of the family.
Families need to make sure that good work is on the public record, but they need to make sure that it is on the public record in the right way.
However, as more successful families are feeling the pressure to communicate and substantiate their positive impact to the UK – either taxes paid, jobs created or philanthropy – a greater number of families are starting to see the need of giving some light and gentle visibility to their family philanthropy.
There are a number of methods families can use to put their charitable work on the public record so that it turns up for a search of their name on Google.
- Short, controlled press releases and announcements on charity websites or online assets
- Targeted press releases to secure positive news coverage for the family and charity
- A family-controlled foundation website to be home to all the families philanthropic work and wider mission
This is not about being on the front page of a newspaper nor is about plastering social media channels with publicity-seeking content, but rather ensuring their charitable work is available to see for those who are already searching for them online.
But, in order to ensure that families’ giving is not seen as insincere, any announcements or coverage of their giving must be carefully controlled. When writing a press release, keep in mind the following rules.
- Showcase the link between the family’s value system, mission and the philanthropic project
- Focus the press release and coverage on the good that the charity or the charitable project is doing – rather than the family’s gift
- Be very careful and selective about naming rights
Many families feel a genuine desire to leverage the resources at their disposal to improve the world. Families need to make sure that good work is on the public record, but they need to make sure that it is on the public record in the right way.
