"The reports of my death are greatly exaggerated," Mark Twain famously said upon hearing that his obituary had been published in the New York Journal. The same could be said of reports in the media detailing the decline of charitable giving in the U.S.-at least when it comes to wealthy donors.
Research published in June by Giving USA Foundation noted that U.S. charitable donations had decreased 3.6% in 2009 to $303 billion (inflation adjusted), from a total of $315 billion for 2008. More alarming, at first glance, are data from an article published October 17 in The Chronicle of Philanthropy stating that last year, donations at the nation's largest charities had dropped 11%, representing the worst such decline in the two decades since the publication started its "Philanthropy 400," a ranking of the organizations that raise the most from private sources.
But the messages regarding the level charitable giving during these recessionary times are actually mixed, according to Eileen Heisman, president and CEO of National Philanthropic Trust, an independent public charity based in Jenkintown, Pa., which raises and manages charitable contributions and assets.
Philanthropy tends to experience a time lag of 12 to 18 months between economic upheaval and its repercussions in terms of giving, Heisman explained. Much of the pullback reflected by recent reports is likely caused by donors with a giving threshold of about $250, who have reduced their donations or opted not to give at all, she said. By comparison, the threshold is much higher among the wealthy. That's significant because, typically, about 20% of the wealthiest donors make about 80% of the charitable gifts nationwide, she noted. The U.S., for instance, ranked fifth in the World Giving Index 2010, which was released in September by the Charities Aid Foundation (Australia and New Zealand tied for the top spot). The report noted that 60% of U.S. citizens give to an organization.
"Even though they have may have lost some of their wealth, they continue to be loyal to the charities they've supported for a long time," Heisman said of very affluent givers. Her advice on how charities can get them to keep on giving? She cited the lyrics in an old Girl Scouts song: "Make new friends but keep the old, one is silver and the other gold." Put another way, she says, stay close to rich donors and keep them informed-in person if possible.
In other news...
Fidelity Investments released a new program designed to help RIAs better handle the investment and service needs of ultra-high-net-worth individual and family clients with investable assets of $50 million or greater. The program offers advisors of all stripes the same resources that are currently available to single-family offices through Fidelity Family Office Services. This includes a dedicated relationship management team and investment analyst/trader, and an open architecture reporting system that supports services such as partnership services and general ledger export services. Advisors' ultra high-net-worth clients also will be able to attend private events designed to network with family offices and share best practices. More information is available at www.fidelity.com.
Nearly half of senior executives polled are most concerned about the prospect of providing a concise description of their uncertain tax positions (UTPs) in order to comply with a new, much-discussed IRS disclosure requirement, according to a survey conducted this month by KPMG's Tax Governance Institute. More information is available at www.us.kpmg.com.
Key findings in the annual survey "Global Trends in Investor Relations," conducted by BNY Mellon, show that 93% of all companies meet with hedge funds, versus 89% in 2009; 24% of a firm's investor meetings are with hedge funds, up from 16% in 2009; and 47% of all companies meet with sovereign wealth funds. More information is available at www.bnymellon.com/dr.
A Chinese bank and several European banks surpassed their American competitors in naming women to seats on their corporate boards, according to a study released last week by Corporate Women Directors International. Only one American bank-Wells Fargo-made it to the top five. More information is available at www.globewomen.com.
Wealth-X, a provider of insight and intelligence on ultra-high-net worth individuals and the privately held companies they control, has released a members-only online research tool with dossiers for high-net-worth prospects. The company's chief research officer is Matt Miller, former global wealth editor at Forbes magazine. More information is available at www.wealth-x.net.
According to the quarterly Ernst & Young U.S. IPO Pipeline study, the pipeline of initial public offerings reached a total of 133 companies in registration by the end of the third quarter 2010, representing 19% growth over the second quarter 2010 total of 112. Total dollars also grew to $26.4 billion, a quarterly increase of 4%. Nineteen of the companies registered to go public in the U.S. are from foreign countries-mostly China. More information is available at www.ey.com.
Goldman Sachs Asset Management has launched a new core real estate investment business that will focus on investing in and managing core and real estate assets, primarily in the U.S. on behalf of GSAM's institutional and high-net-worth clients. Jeffrey A. Barclay, former managing director at ING Clarion Partners, had been named to head the effort.
Boston-based Silver Bridge Advisors has launched a family office division called Silver Bridge Family Office Partners. More information is available at www.familyofficepartners.com.
During the third quarter 2010, 102 venture-backed companies exited via a merger, acquisition or buyout and netted $5.7 billion, a 5% increase in deal activity compared to the third quarter 2009, according to Dow Jones VentureSource. Nine initial IPOs raised $723 million in the third quarter, up from two IPOs that raised $451 million in the same period last year. More information is available at www.dowjones.com/privatemarkets.
Russell Investments has launched The Russell World Cap Index, which combines the U.S. broad-market Russell 3000 Index and the Russell Global ex-U.S. Large Cap Index. The new index currently comprises 5,193 securities and about 93% of the Russell Global Index. More information is available at www.russell.com.
BNY Mellon introduced TreasuryEdge, a new electronic banking platform from BNY Mellon Treasury Services. Included in the product are advanced balance reporting and other reporting capabilities, increased security, expanded file transmission tools, streamlined user functionality and expanded user entitlements. More information is available at www.bnymellon.com.
Events
The CIO Executive Roundtable will be held in Santa Monica, Calif., on November 4. Discussed will be the leadership roles in strategic transformation projects CIOs must take-or risk being marginalized. More information is available at www.hmgstrategy.com.
The XBRL US National Conference, "The Path to Transparency," will be held November 9-10 in Philadelphia. Featured will be practical sessions for public company financial executives and securities processing professionals, with keynotes by Cynthia Meyn, senior vice president, PIMCO, and others. More information is available at conference.xbrl.us.
Merriman Capital's 7th Annual Investor Summit is scheduled for November 16 in New York City. More information is available at www.merrimanco.com.
Sidoti & Co. LLC will host its third Micro-Cap Conference on January 10 in New York City. The event will focus on the sub-$250 million market cap sector. which Sidoti feels is neglected by Wall Street. More information is available at www.sidoti.com.
On The Move
Windham Capital Management opened a new office in Boston's John Hancock Tower to house the firm's expanded wealth management services. The company's original office is in Cambridge (part of the State Street Associates campus) and remains focused on institutional investors. More information is available at www.windhamcapital.com.
Winston & Strawn LLP, an international commercial law firm, has expanded its transactional capabilities in China by hiring private equity and venture capital attorney Jem Li as managing partner of its Beijing office. Also joining are corporate associates Haihang (Helen) Zhang and Na (April) Wang.
U.S. Trust has appointed eight wealth management advisors to serve ultra-high-net-worth clients in markets across the U.S. They are: Diane Wakefield, private client manager (Walnut Creek, Calif.); Greg Owens, private client manger (Bellevue, Wash.); Michael Muttart, regional trust executive (Newport Beach, Calif.); Marc Compton, senior vice president and market executive (Menlo Park, Calif.); Jason Foster, senior vice president and private client consultant (Santa Rosa, Calif.); Marian Howley, managing director and private client consultant (Stamford, Conn.); Kerby Wallick, senior portfolio manager (Grand Rapids, Mich.); and Tony Fout, senior portfolio manager (Chicago).
-Cort Smith