Fifteen Timeless Tips for Trustee Training and Succession

Year after year, one topic in family philanthropy rises to the top: inspiring, engaging, and preparing the next generation for leadership. Sooner or later, unless the board decides to spend down the endowment, board succession in family foundations is a matter of when, not if.

Since its founding in September 1997, the National Center for Family Philanthropy has published dozens of issue papers, articles, guides and checklists related to this topic, and has participated in hundreds of seminars and meetings with family foundation boards and staff on best practices in accomplishing this goal. To celebrate the National Center’s 15th birthday, this month’s edition of Family Giving News shares 15 Timeless Tips for Training New Family Foundation Trustees, featuring best practices highlighted in past National Center publications.

Introduction: Principles to Keep in Mind

In her short primer, Opportunities for the Next Generation to Learn About the Foundation, National Center Senior Fellow Alice Buhl outlines several principles that are essential for any family foundation thinking about how to prepare next gen family members to participate in the work of the foundation

  • Interest can be encouraged, but not forced. There needs to be a genuine motivation to participate.
  • Offer different possibilities to reflect the range of ages, interests, and skills of family members, as well as the time and financial means they have available.
    The opportunities should be genuinely useful for both the foundation and the family member, respecting the strengths of each.
  • Next generation family members need to participate in suggesting approaches they might find meaningful. Engage their thinking and input right from the start.

With these principles in mind, let’s take a look at our 15 Timeless Tips:

TIP 1: Answer the question: why do we want the next generation involved?

Why are you embarking on this important exercise? What do you hope to achieve? Not surprisingly, the answers to “why” and “what” will likely determine the strategies you choose. By considering these questions, you may realize you’ve been looking for a succession formula while overlooking something of special—if previously unspoken—importance to you. For more details on when and why to consider a succession planning process, start with NCFP President Virginia Esposito’s classic issue paper, Successful Succession: Inspiring and Preparing New Generations of Charitable Leaders.

TIP 2: Engage all family members in the process.

When making way for a new generation to continue the family foundation legacy, keep in mind that the older generation possesses both institutional memory and a broad base of knowledge and experience. Finding the right mix of older and younger generations provides ongoing opportunities for intergenerational learning and a board that can best steward the family’s shared philanthropic legacy. Finding that mix and the best operating style is a process that should be managed with careful attention, as it is not likely to occur organically.

TIP 3: Discuss your shared perspectives about what being part of the family philanthropy means to current board members.

Be honest about both the requirements and limits on participation, and find ways to articulate this within your family. Determine the expectations your family has for next gen family member involvement, and address any gaps between these expectations and the individual perspectives of next gen board members.

TIP 4: Learn from the field of family business about the different types of family leaders, and how each approach succession.

In Passing the Baton: Generations Sharing Leadership, Alice Buhl reflects upon the similarities between family business and family foundation succession, and describes the challenges of each. “In the family business world, there have been extensive studies on succession issues in family businesses,” writes Buhl. “Family foundations can learn from family businesses about the different ways key business leaders approach succession.” Buhl cites four styles of departure of a key leader in the family enterprise, originally developed by Jeffrey Sonnenfield: Monarch; General; Ambassador; and Governor. Interested in knowing which type your foundation personifies? Read the article!

TIP 5: Find ways to cultivate a strong sense of donor and family history and tradition, while welcoming the fresh perspectives and ideas of new participants.

In Successful Succession, Esposito writes, “some families fear that generational succession implies a diminishing respect for the donor’s legacy or the family’s tradition of charitable giving. Others become concerned that too much emphasis on the family legacy will stifle creative input and commitment from newcomers. In family philanthropy it should never be ‘either/or’. The family’s tradition of giving is a very special inheritance you pass on to the next generation. The new energy and commitment they bring will ensure that legacy is refreshed and vital.” One creative option: ask the next generation to lead a project to record the foundation’s history on audio or videotape. Other ideas include inviting speakers who can talk about the donor’s life and the foundation’s history; or holding a discussion about the history of the foundation’s money, and what that means for its legacy.

TIP 6: Consider establishing a next gen advisory board (sometimes called an adjunct or junior board), and invite potential new trustees to serve.

A growing number of family foundations around the country are creating adjunct, junior, or next gen boards to provide their younger family members with the chance to review proposals, conduct site visits, and discuss and vote on grants and projects alongside other younger family members. If you go this route, be sure to check out NCFP’s list of questions to consider when forming an adjunct or associates board, and connect with the national Youth Philanthropy Connect movement co-sponsored by the National Center, the Frieda C. Fox Foundation, and several other family foundations with next gen advisory boards.

TIP 7: Consider establishing an emeritus title or senior council, to ease the difficulty of transition for those who may be ready to move on from the foundation board.

In Passing the Baton, Buhl reminds families that “It is not easy to let go but it is much easier if family members respect the continuing value an elder has in the family and the family’s philanthropy. Seniors often have a great deal of wisdom to offer if they are asked and given opportunities to advise without controlling. Many learning opportunities are lost if the next generation assumes that the senior generation is out of touch or doesn’t have anything to offer.” Two options that Buhl cites are the use of an emeritus status for board members who reach a certain age with various privileges and responsibilities, or the establishment of a senior council, which is managed in a similar way to that of a junior advisory board (see above).

TIP 8: Review the nuts and bolts, and provide hands-on grantmaking experience.

Educate young adults about being a trustee and the scope of their responsibilities and decision-making authority. Hold a workshop to review the foundation’s mission, history, bylaws, and investments. Provide a board booklet with reference materials. Visit a range of programs to learn about issues. Bring young adults to meetings and on site visits to organizations that range in scale and approach, and debrief afterwards. Teach young adults how to read nonprofit financial statements and about the other technical information they will encounter. Any or all of these opportunities provide essential training in grantmaking and governance.

TIP 9: Find mentors, and identify other outside learning opportunities.

Encourage mentoring relationships both outside of and within the family, either with a senior family member, a staff or board member of another foundation, or even a trusted member of your local nonprofit community. Consider inviting young adults to attend philanthropy conferences, regional gatherings, nonprofit events, and other educational forums. Offer them subscriptions to philanthropy and issue-based journals, and provide them with a list of top Twitter feeds in philanthropy to follow and interact with (contact the National Center staff for ideas!).

TIP 10: Establish eligibility guidelines – both for next gen family members, and for the family at large.

In Choosing and Preparing Your Grantmaking Successors, author Mary Phillips of GMA Foundations shares the eligibility requirements of the Polinger Family Foundation: “To be eligible for election, third generation family members must be at least 22 years of age, and complete junior level involvement with the Foundation. Junior level involvement is defined as three years of participation in a discretionary grants program, plus a demonstrated interest in and commitment to the foundation as well as some knowledge and experience in fields related to the foundation’s work. For example, interest in the foundation’s work could be demonstrated by participation in site visits or observing board meetings.

Knowledge and experience could be gained by participating on a board committee, learning about the foundation’s investments, helping with web site development or the electronic newsletter, attending training sessions and informational meetings, or participating in on-line learning opportunities.” For more on this important topic, check out NCFP’s essential Passages Issue Brief, Families in Flux: Guidelines for Participation in Your Family’s Philanthropy.

TIP 11: Support next gen family members to explore and create their own personal giving identities.

Many young adults may wish to go through their own process of creating personal values, mission or “legacy” statements—a strategy often recommended to older family members who wish to articulate their philanthropic values for successive generations. This can help them to clarify their goals and ideas about giving, and to develop their own giving “voice”. What approaches and issues do they want their giving to promote? What do they want to avoid? This can be a tool for helping young adults discuss their interests with their families, and a way of encouraging the family to develop a shared statement to adapt over time. In Opportunity of a Lifetime: Young Adults in Family Philanthropy, next gen trustee and philanthropy author Allison Goldberg reminds families to “Keep in mind that many young adults may choose to explore issues that don’t fall under their families’ funding guidelines. By giving their own money and time to these causes, young adults can learn from their own experience. They can develop strategic giving plans for their own funds. Or, as several groups of young people have done, they can create a giving circle—a group of people who pool money and come up with a distribution strategy together. Convening with a peer group in the non-profit and philanthropic sectors is a valuable way to learn about issues and funding strategies. Young adults can then bring their own experiences as funders back to their families.”

TIP 12: Provide opportunities for next gen family and board members to connect and learn from their peers.

Goldberg also advises that one of the best ways to prepare new trustees is to have them visit other family foundations and connect with other young trustees and professional staff. Young people around the country have established peer networks to support each other as they explore the many ways that access to philanthropic and financial resources shapes their lives. For many young adults, getting beyond the barriers of isolation and identity issues requires spending time connecting with peers and exploring who they are, how money fits in to their lives, and its relationship to the issues they want to address through philanthropy. Examples of just a few of these networks include Resource Generation, Emerging Practicioners in Philanthropy, Social Venture Partners, 21/64′s Grand Street Network and Bolder Giving.

TIP 13: Create a discretionary grants program to train new or future trustees in the work of the foundation and the grantmaking process.

“Discretionary funds can be used as a way to “train” new and future trustees in how to make grants—although this can only be accomplished if there is some structure to the discretionary funding process,” said Deborah Bussel, a trustee with a Florida-based family foundation. Such a process may include site visits and proposal review by an advisory or adjunct board of younger family members, with the adjunct board then submitting its “approved” grants to the official board. To read more about the options, opportunities, and creative uses for discretionary grants – as well as potential complications of this tool – see Discretionary Grants: Engaging Family… or Pandora’s Box? by Susan Crites Price.

TIP 14: Be flexible about time constraints and personal priorities.

Keep in mind that there are times in our lives when we are overwhelmed and simply cannot do a good job of fulfilling all our commitments. Understand that there may be these kinds of constraints on your children and work with them. If your daughter’s path to becoming a doctor includes a time-consuming internship, let her know you understand if she is not able to serve on the foundation board just now, but you will welcome her when circumstances change. If a next gen family member cannot yet meet the expectations you have, give them a sabbatical or let them step off to be reconsidered when their schedule is more open. (Source: “Successful Succession.”). “No matter what is prompting the lack of motivation, don’t assume it is forever,” writes Ginny Esposito in Motivations for Board Service: Why Many Family Members Want In and Some Don’t Want to Leave. “Keep the door and the lines of communication open. Be ready to welcome someone in when the time is right for the young person and the foundation.”

TIP 15: Be patient – be prepared to step back before moving forward.

Choosing and preparing successors is a process that can be stymied by setbacks. For many families, the process may take years during which the board develops a donor legacy statement, rewrites its mission statement and guidelines, revises its articles of incorporation and by-laws, restructures its governance and realizes that perhaps not all next generation members will be able to join the board. Adults in their twenties and thirties may be in school, beginning new careers, or starting new families, and may not have the time to devote to the foundation. The board should be prepared for the possibility that it may need to take several steps backwards in order to take the leap into a successful succession plan. The process is worthwhile, and, done wisely, the results can be rewarding for everyone.