Keeping philanthropy in the family; Catholic foundations cope with generational change

National Catholic Reporter, March 11, 2005 by Jeff Severns Guntzel

When Kerry Robinson was 14 years old, she did a study analyzing the grant-making trends of The Raskob Foundation for Catholic Activities.

Decades later, when she mentions in passing the study and the fact that she was "formally involved" in the foundation as an adolescent, she doesn't laugh at the strangeness of it all. She just keeps going: "I was attending the meetings. I was able to observe how the foundation operated."

Robinson is the great-granddaughter of John J. Raskob, who in addition to being the financial genius behind General Motors in the 1920s, was the man most responsible for the construction of the Empire State Building. The proceeds from the sale of his interest in the world's tallest skyscraper provided the seed money for the Raskob Foundation for Catholic Activities, today a $100 million-plus family-run philanthropy awarding between 250-400 annual grants to Catholic institutions around the world.

Today, Robinson, the 38-year-old director of development for the St. Thomas More Chapel and Catholic Center at Yale, is a fourth generation member of the foundation--part of a family-run board that oversees the legacy of John and Helena S. Raskob.

The nearly 40,000 IRS-recognized nonprofit family foundations in North America oversee $175 billion in assets and distribute more than $8 billion in grants annually, according to the National Center for Family Philanthropy. Two-thirds are small, with assets of less than $1 million with giving largely focused on making annual grants of less than $100,000.

"The vast bulk of philanthropy in America is personal giving," said Kelin Gersick, senior partner at Landsberg, Gersick & Associates, a consulting firm that assists family businesses and foundations, and coauthor of Generations of Giving: Leadership and Continuity in Family Foundations. "But there is a significant subset that is done through institutional means," Gersick told NCR. And when institutions engage in philanthropy, Gersick added, "It's not just a matter of sustaining a network of existing systems--which individuals can do through the United Way and the Red Cross and so forth--it's a matter of supporting efforts that have no other way to sustain themselves. They're not going to be supported by the public through taxes and there's not an economic base in membership to sustain them.

"If you look at the role that private foundations have played, the list is nearly endless: hospital units that would not exist, symphonies that would not play, afternoon school programs that would not exist."

Foundation giving, he said, has the potential to "create the life of a community."

In the vast but somewhat insulated world of big money philanthropy, there are private foundations, community foundations and family foundations. And it is the challenges and opportunities unique to family foundations that Gersick--who has worked as a family therapist--has his eye on.

"Family foundations," Gersick said, "have the advantage of being able to focus and to sustain their commitments because they don't have to please a large and politicized constituency." But they face a host of challenges, not least maintaining their identity and purpose as the generations disperse and interests wane.

Keeping family foundations focused and moving forward--specifically Catholic family foundations--is a driving concern for Francis Buffer, president of FADICA (Foundations and Donors Interested in Catholic Activities), which describes itself as "a consortium of private charitable foundations and individual donors who share an interest in religious philanthropy." FADICA'S 45 members control $2.9 billion in assets and annually award grants totaling approximately $187 million.

"We have, for the past year and a half," said Butler, "been focusing on the younger generation of trustees, in their 20s and early 30s." Butler was struck by how little family foundations were doing to usher in the next generation of leadership.

"We had foundations that waited too long," Butler said. "They waited until the mother and the father were at retirement age. They were phasing out and they turned to their adult children who were almost middle-aged and said: 'You take the foundation from here.' And they would say: 'We have other interests and we're not really interested in doing this. We don't know that much about Catholic philanthropy so we're not going to get involved.'"

Butler said, "Now I think there is an awareness that we've got to get this very early. You've got to involve younger people and that way your transition is going to be all the more successful."

Robinson's experience underscores Butler's equation of success. The Raskob Foundation doesn't bring members in at 14 anymore, but every one of the Raskob descendents receives an invitation to join in their 18th year. Robinson was on the board of trustees at 26. Today, she says, there are more than 100 descendents serving as active members of the foundation. Each year, working by consensus wherever possible, John and Helena Raskob's brood volunteer time to review more than 1,000 grant applications.