Giving with Impact:

[MICHAEL GORDON VOSS] Giving with Impact podcast, Values Based Philanthropy, episode six.

Welcome to Giving with Impact, an original podcast series from Stanford Social Innovation Review developed with the support of Schwab Charitable. I'm your host Michael Gordon Voss, publisher of SSIR. In this series, we hope to create a collaborative space for leading voices from across the philanthropic ecosystem to engage in both aspirational and practical conversations around relevant topics at the heart of achieving more effective philanthropy.

When beginning new or scaling up existing philanthropic activities, many strategic donors rightfully spend a great deal of time thinking about how to invest, identifying the vehicles and approaches that provide the greatest opportunity to maximize their financial commitment. But equally crucial is spending time on the why of their philanthropic approach. How can we best identify not only the causes or issues that matter most to us, but those where we can make an impact, and what methods are at our disposal to do so?

Joining me today to explore some of these questions are two individuals with extensive experience in both investing and financial planning strategy and philanthropy.

Jodi Morris spent 22 years in investment management, leading strategic US business building initiatives at notable firms like JP Morgan and Matthews Asia. She founded Connecting Growth Globally to join investors to the economic, social, and cultural futures of people in rapidly changing economies with the vision of connecting people and ideas to maximize impact.

Eddie Brown is the national managing director and head of Schwab Advisor Family Office where he leads the development of the strategy and serves as a thought partner for families and advisors who lead single and multi-family offices on Schwab's Advisor Services platform. Eddie brings over 25 years of experience to Schwab in a variety of leadership, strategy, and general management positions in the financial services industry with a deep focus on serving affluent households.

Jodi, Eddie, thank you both for joining me for today's discussion on values based philanthropy. Let's get started.

Jodi, when I look at some of the activities of connecting growth globally, I can get a sense of some of the issue areas that are important to you, including education for women and girls, and leadership training for entrepreneurs in the developing world. But can you speak a bit about those issues and any others you're involved in, what fostered your passion for that work, and how that led you to found CGG?

[JODI MORRIS] Sure. Thank you, Michael, for having me join you today. You know, I think the most important phrase in the title of our discussion is 'values based.' And it's getting to the answer that age old question, 'What do you really care about?' And that often happens when we go through some sort of transition in our life. You know, maybe it's a big move, we decide to have a family, it's a career change, and for me, it was going through a career change. And the years coming up to that that really forced me to think about, you know, what values are most important to me?

So I thought about, you know, what are the things that I mildly obsess about, I write about, I talk about, I speak about on such a regular basis? And in doing that, one day I just pulled out a piece of paper and I drew three circles in a sort of Venn diagram, and I labeled the three circles leadership, girls education, and global investing. So those were my three values, those three things that I cared most about.

Global investing was a natural. I had spent a lot of my career focused on investing globally and helping investors see the great investment opportunities that are open to us outside of the United States.

Girls education stemmed from the fact that I was a former girl for whom education, you know, higher education was not a given, and in my personal travels I began to see that there were all kinds of barriers that got in the way of girls getting even just a primary or secondary school education all around the world. So that was a fit between my personal story and what I saw in the greater world.

And, finally, leadership. You know, when I look back at my investing career, the most meaningful part to me was the work that I did with leadership coaches, and the work I did in bringing leadership coaches to work with my team, and how that made me more self-aware, a better communicator. And I really flourished as both a professional and an individual. And I saw that happen with individuals on my teams. I saw us become better teams. And I saw us go from good to being great.

So those were the three things—global investing, girls education, and leadership that were my three passion areas. And I wanted to have a next-stage career after leaving the investment management industry, which worked at the intersection of all of them.

[MGV] So that's a great way to explain the inspiration for founding Connecting Growth Globally, and your values and your specific interests. Can you talk a little bit more about how your philanthropic interests then manifest in your investing strategy,

[JM] Sure. Well, I started diving in to philanthropy... for me, right, this focus area of girls education was my... was my choice because it was the thing I... I had spent the least amount of time on, I knew the least about. And... so the first thing I did was jump on a plane and I spent a month at a girls school in Nanyiki, Kenya.

And when I was doing that work, I also ran into a lot of people that were investing in places like Africa where I was spending a lot of time. And you can call this impact investing. There's a lot of things going on in Africa, particularly in the fintech space. That appealed to me because of my investment background and also because it was... it was an equalizer, right? It was a way to really through a... through a mobile phone equalize the people that lived in the more rural areas with those in the cities. So those opportunities were interesting. My network grew with people and organizations, and I found that it wasn't a division between philanthropy and investing, it was one shared community.

One thing that became really apparent and really important to me was the idea of gender lens investing. I was starting to read more of the statistics of, you know, you see the funding that goes to women in private companies, you see the percentage of women on boards, and how dire the numbers were. And so I was curious on how it would look in my portfolio. And it was interesting because even a lot... a lot of my larger holdings in the portfolio, they might have been consumer-oriented companies, and we all know that women make the majority of the purchasing decisions, whether it is technology, consumer goods, you know, anything for the home. So that made no sense, because when my money manager was... was recommending this strategy to me, it was cutting out companies that didn't have at least one woman on the board, that didn't have at least 15% in senior management in women. And I was shocked by some of the names that I would have to move out of my portfolio to move to this gender lens strategy.

[MGV] Eddie, let me ask you, in working with family offices and their advisors, have you seen a similar focus on aligning values with philanthropic investment?

[EDDIE BROWN] Yeah, thank you, Michael. And it's inspiring to hear Jodi's story because many individuals and the families that I've worked with over my career are very successful in business, but finding their passion, they may seek a lifetime for that. And when... when you look at the unprecedented growth in the ultra-wealthy population over the last few years with over 80,000 individuals with 30 million or more in assets, the number of households have increased but also the expectations have increased. And one of those expectations has really been the emphasis on being able to give back to society. And the... the philanthropy is really organic and an organic affinity with this population of successful families, but it varies over age group. And it's interesting, philanthropy, when you look at hobbies and interests from Wealth-X Report, it starts with business interest because that's where the wealth is obtained, but then it lends in the top four category as... as philanthropy, and that spans across all age demographics there. So that affinity, it's really important and it's increased over... over time. And this... this population of clients, it's becoming more and more important because it represents 20- to 30% of the overall individual giving in the US.

So the trend that we're seeing is the... the growing value in community... community and connecting with other likeminded individuals with similar interests. And, you know, you see it on the wealthiest end of the spectrum with the Giving Pledge and Gates and Buffet, but it's also happening much more broadly and across the country with different cohort groups that are coming together. And it's interesting, no matter where you are on the wealth spectrum, the top question that wealthy people have is what are other people like me doing? And a lot of that really parlays nicely into what they're from a philanthropic perspective and how they can learn, share, and sometimes even combine resources together to have that impact. So family office professionals and advisors to these families must find ways to make these connections, and... which may be the highest value activity they can give beyond financial planning and investment management.

You're... and you're also seeing where these foundations, that the newer foundations are investing much more human capital and time to measure the impact of that philanthropy. And that measurements really is the difference on, you know, how their dollars are... are truly making an impact more broadly, and you're seeing that more and more from the next generation of having that measured impact approach to philanthropy. But there's a lot of resources out there and organizations like Jodi and what she's created around connections, and there's also a great ways to learn about philanthropy. I recently was spending time with Justin Rockefeller who was sharing with me a site called TheImpact.org, which provides some great education to help inspire and connect others, and help them learn together.

[MGV] So, Eddie, you already mentioned a sense of community and peer alignment, let's say, in investing and a trend towards human capital in the approach by the ultra-wealthy or some of these trends. What are some other trends or changes in approach or methods among the ultra-wealthy and the family offices that serve them that you've seen?

[EB] Yeah, and it's consistent across their overall management of their wealth is that need for transparency, transparency, deeper involvement in their overall management of their business and of... of managing their wealth, and that's why family offices are created. And then, also, optionality on investment vehicles that are... that are made available, so they're able to put their total dollars to work across the asset allocation. And there's this convergence that we've seen, and it's becoming more and more prevalent, as... as just the charitable giving and personal investment strategy converging together, and Jodi had spoken to that earlier.

[MGV] So, Jodi, you already shared how your professional experience and your personal interests, specifically in areas of leadership, women and girls, and global investing led you through your decisions and to formulate your strategy. Can you share what course of action you might recommend for people who want to do something similar, who want to more closely align their philanthropic goals with their investment strategy?

[JM] Sure. It will not surprise you to hear me say it all starts with you and your values. How you do that? First of all, you know, it can take time. You might want to work with a coach. I read a number of books. There's a lot of philanthropic needs out there. So I always guide people who say, 'Oh, I want to spend more time philanthropically. I'm going to go out there and figure out what is needed.' Start with you, right? So that's... that's going to be really important, too, because what... when you go out there in the big world and you see all these needs, what you're going to need to become very good at is saying no. So the more clear you are, the easier that's going to be able to do.

I also recommend that you, you know, start flying the plane while you're still building it, if you will. If you sit back and go, 'Okay, I'm going to do all this big research before I figure out what I'm going to do,' you will never get to it. One thing that actually helped me is I set up a donor-advised fund in the early days, and that was something that was... it just forced me, 'Hey, you've given the money away. Now you really need to do something with it.' So that... that just gave me that little push to get serious with this and just get started.

The final recommendation I say is that this is a journey and so you're continually refining it along the way. So like I said, I started with girls education. This is a huge space and there's lots of different types of girls education organizations. There's a lot of different ways organizations work and I got really clear on things that are important to me and what I see in an organization I work for, invest in, give to. I need... given my background, I need to see transparency, accountability. I need to see excellent communications to me as a donor, to me as an investor. So those are things that are very particular to me. So it's not just what the organization does, it's... it's how they do it.

[MGV] when you were talking about connecting and transparency, it just reminded me that we saw some data recently collected from over 1,700, I think, non-profits around the world and they said that what they were seeing across the boards coming from their funders, their donors, their investors, was... were exactly those things. They wanted closer connection to the organization, to the impact they were creating, and they wanted greater transparency in the work that was taking place.

[JM] Yeah, definitely. You just have to figure out what... the... the role you wish to play, right? It's... you would have a different answer. For some people it would be serving on a board. I know I need to really narrow it down to a few key... you know, key players because I want... I want a very active role.

[MGV] Eddie, you shared some trends with us earlier. We like to end each episode looking towards the future. So let me ask you, what changes can you envision in the way the next generation of donors may be engaging with their philanthropy in the coming years?

[EB] Yeah, it's interesting, we've been hearing about this intergenerational wealth transfer for decades. And it's, you know, projected at $10 trillion by 2030. So it is significant nature, and I think what... what we're finding is that the Gen X and Millennial investors that have much different views than their parents, and it was often thought through different planning from years ago that that philanthropy can actually bring families together. But you're finding that instead of more of a place-based giving strategy of their parents, that there's a much broader array of social issues that are being faced by this next generation. So it's breaking away from the traditional way of giving. You combine that with just the... the... the sheer number of... of individuals.

So you're... so you're seeing, you know, a... much wider array of social causes and issues that they're focused on, different from what the previous generation had given to, but you're also seeing sometimes a heavier concentration of both time and dollars into really understanding these different charities that they're looking to really make a true impact on on things that matter.

So where philanthropy may have been once the tie to bring families together, I think oftentimes today it leads to more challenging conversations around the holiday tables when you speak about philanthropy, and it's for the right reasons. So you're seeing that significant shift.

I think you'll continue to see, you know, wealth growing. Philanthropy, it's great that it's... you know, as important it is, as a building block for both families of success, and... and really being able to contribute in different ways than they ever had before with the resources that are made available. So there's different types of ways that they're giving, whether it's, you know, multi-year grants, general operating grants. Jodi mentioned serving on boards, so contributing their own time. so you'll see that wealth continuing to grow, you'll continue to kind of see the spread on what the needs and goals are for philanthropy for that next generation, which will challenge a lot of the family office professionals and advisors out there that serve these individuals.

I think, you know, a win for philanthropy and a win for the successful families is when goals are aligned. And when goals are aligned individually, as well as a family, as well as their advisors, and they're able to, you know, find ways to connect with other likeminded individuals, do more of that, find the right types of organization, and do... I'm inspired, once again, by Jodi's comments and her story on how she arrived at her passion and the impact that she's having individually. And it's learning from others like... like Jodi that can really help a lot of these families across the country for decades to come.

[MGV] Well, learning and sharing personal insights and information is exactly the reason why we launched this series. So I think that's a perfect spot to wrap up this episode, since we unfortunately have run out of time. But I do want to thank both of you, Jodi, Eddie, for joining me today and for sharing your insights.

[JM] Thank you for having us.

[EB] Thank you. Really enjoyed it.

[MGV] Thank you for listening. We hope you've enjoyed this episode. Please consider leaving us a review on Apple podcast or your favorite listening app, as it helps others discover the show. We encourage you to listen to other episodes in the series, as well as other podcasts from SSIR, Schwab Charitable, and Charles Schwab. This podcast series is made possible with the support of Schwab Charitable, who played an important role in the selection of topics and speakers. For important disclosures and a transcript of this episode, visit SchwabCharitable/Impactpod...

For important disclosures and a transcript of this episode, visit SchwabCharitable.org/ImpactPodcast.