One of the greatest gifts that a founder can provide to current and future foundation trustees is a well written legacy statement. Similar to estate planning, a legacy statement can document one’s values and vision and encourage family unity by minimizing the risk of disagreement on the foundation’s direction in both grant-making and longevity.
I recently spoke with Brad Norton, Director of Endowment Solutions, for Winfield Associates, who believes that current events reinforce the urgency for founders to write or revisit legacy statements to adapt to an evolving society.
Q: Let’s start with the basics – what is a legacy statement?
A: Every founder has their own unique reasons for establishing a foundation. The legacy statement provides the founder the opportunity to share their vision behind the foundation for current and future generations. There are usually two common goals — philanthropic aspirations and family unity. This is an opportunity to provide guidance in setting a philanthropic strategy for the assets. Regarding family, the founder can share values, wisdom learned from experience, encourage community involvement, and provide board leadership opportunity. As families grow and spread out, a foundation can also benefit family relationships as a unifier across generations and geography.
Q: So, how does one get started on writing a legacy statement?
A: Begin by just writing down thoughts around values, lessons learned from personal experiences, what has brought joy to your life, what is important to you, organizations that one has volunteered with, why one has supported different organizations, community needs, etc. Reflections should include family history and stories of some of the positive parental and mentor influences that have significantly impacted your life. The most difficult challenge will be determining what to exclude. Give yourself a few months and expect several revisions.
Q: What’s your advice on whether family members could or should be involved in this process of writing a legacy statement?
A: Great question. Yes, communications with the second and third generations should be pursued. Having an open dialogue and sharing your desires and funding interests with family members is important. Just as important, are your listening to family members – What are their interests? Where is their passion focused in terms of areas of needs (direct services, health, arts, education, etc.) and types of organizations to support? This dialogue is educational to the founder and provides perspectives that can be included in the legacy statement. Family members will appreciate being included in process. The founder’s ability to incorporate flexibility in future grant-making to recognize and provide for changing societal needs will especially be appreciated.
Q: Recognizing that issues around money and control can complicate family relationships, are there any specific issues to discuss in a legacy statement to limit the risk of dissonance in the future?
A: Having a legacy statement is a great resource to begin with. To address this specific issue, a founder should convey their desire to support family unity and to never want the foundation to be a burden on family members. A founder can specify upfront the life span of the foundation. Having an end date creates discipline in the grant-making process. If a founder desires for the foundation to last in perpetuity, there should be an out clause if family discord or disinterest becomes an issue. Donating assets to another foundation or community foundation could be specified.
Brad Norton, CFA, is Director of Endowment Solutions for Winfield Associates, Inc., brad@winfieldinc.com
