Northern Trust philanthropy breakfast with Michael Green, author of the book Philanthrocapitalism and Marguerite Griffin, National Director of Philant

Date: 29 Nov 2010


Picture: Top: Aïda Molineux,Senior Vice President and Head of Wealth Management EMEA Northern Trust

Bottom: Marguerite Griffin, National Director of Philanthropic Services at Northern Trust

Northern Trust philanthropy breakfast with Michael Green, author of the book Philanthrocapitalism and Marguerite Griffin, National Director of Philanthropic Services at Northern Trust.

“Philanthropy is about how to shape the future differently.” explains Marguerite Griffin, from the Northern Trust offices at Canary Wharf. “We always say to UHNW clients that grants should be for the long term. Short term giving just makes it difficult for charities to sustain their work.”

Charities forced to merge and UHNW give less

“Philanthropy used to be about foundations but now there is a switch to non profits. Non profits have sprouted up because UHNW can always be found to support them no matter what the cause. It’s a market failure of charities that there is so much duplication of their work but the liquidity crisis is addressing this. It has forced charities to merge because private individuals are giving less.

Charities are inherently inefficient but some have pulled together to consolidate their administration which has helped save $200,000 between a group of charities in the US.”

Younger generation on philanthropy – want to solve social problems in a click

“The younger generation have wider thoughts about philanthropy. Rather than buying beds for a hostel they want to change society so that beds aren’t necessary. They are buying into their parents goals. Youngsters want to work for organisations who are doing good things for the world as a whole – we call it a wellness approach. The techno’ generation have always been able to press a button and make something happen and they view philanthropy in this way too. Business for them is not just about making money you have to give back at the same time.”

Different issues in different countries

” Philanthropists like Bill Gates are really starting to prove their worth now. They are finding a niche and working on it not taking over from the State, although different issues are key in different countries. Green adds a comment. “Philanthropists in India like Azim Premji, one of the richest Indian families in the world, are helping areas like education because the government can’t keep up with the growth of the populations and need for schools and infrastructure.” Griffin agrees adding, “Seed changes to philanthropy and its approach will happen because the richest man in the world is now Mexican. Philanthropy will change from an all American output to more international. Women are also the new philanthropists so issues that they support will bring change.”

Controversial businesses – still ok to be involved with philanthropy?

Looking at companies like Spearmint Rhino (a Citywealth Editor suggestion following a press feature about the business), replies Green, “The money is not bad; it’s perfectly legal. If they do philanthropy, it is a good part of the system whether their business is morally right or not. However this doesn’t apply to emerging markets which are different. Non regulated businesses are more complex to understand.”


Griffin adds her view, “We see lots more attachments to the money donated in future specifying how money is to be used. It’s also a market failure that not enough people are talking about giving, that way we could iron out more problems that are often hidden.”

A succession issue: protecting donor intent

Technically a trust document can make donor money be spent in the same way forever but someone who wanted to give typewriters may not have foreseen that computers would replace them,” says Griffin, “so interpretation of documents is important and can be tricky.”

Charity payout rule in the USA

“In the US we have to pay out five percent of charitable assets each year,” says Griffin. ” There is a payout rule and a new public interest test. This isn’t the case in the UK and would add ¬£1bn to payouts.”

Northern Trust

As ofSeptember 30, 2010, Northern Trust Corporation had:
$81 billion in banking assets
$3.9 trillion in assets under custody
$657 billion in assets under management

If you are inLondon’s Mayfair usethe Janet Ginnings hair and beauty salon and join the likes of Caprice, Sadie Frost and your very own Citywealth Editor, Karen Jones atthe salon.

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