Strategic Philanthropy: Many Paths to Choose Part 1: Designing A Philanthropy Strategy

By Loren Francis on October 15, 2020

What is Strategic Philanthropy?

For donors who wish to truly maximize the impact of their giving they should really think about developing a strategic plan rather than taking a random approach; or one that is simply dictated by the numerous requests one might receive. To be truly effective in your giving, develop a proper plan to optimize impact and efficacy so that you can feel good about the difference you are making and understand the impact you are having. You might call this giving with purpose.




The desire to promote the welfare of others, expressed especially by the generous donation of money to good causes. Charity aims to relieve the pain of a particular social problem, whereas philanthropy attempts to address the root cause of the problem.

As with business planning, a thoughtful and engaging strategy will help determine what you want to achieve from your giving, and how to do it most effectively.

You may know where you want to direct your donation dollars. However, it may be difficult to prioritize given the range of pressing needs and requests; and the vast number of charitable organizations that exist. There are so many causes to choose from: social, health, education, environmental, community, children, women, diversity & inclusion, reconciliation, arts, music, sports, animals, and the list goes on. Defining a clear focus facilitates giving in a manner that is not ad hoc, or just giving to all the requests that come your way. By having a properly thought out philanthropic plan, you can politely decline requests for donations that do not fall into your plan. You can suggest that your giving is complete for the year, and then explore whether certain requests fit with your strategy.

Developing your Philanthropic Strategy

6 Main Themes:

  1. Involve Family
  2. Design your Vision and Mission Statement
  3. Determine your Objectives
  4. Determine your Aims
  5. Choosing your Causes
  6. Measuring Impact

Determining the causes where you wish to make an impact can be accomplished by asking yourself, and your family:

  • What are your motivations?
  • What issues in your community are of concern to you?
  • What keeps you up at night?
  • What concerns you about the future?
  • Do you want to make an impact in a specific area?
  • If you could spend two weeks volunteering for any cause, what would it be?

Start by identifying your passions and values. Reviewing your past donations could be a start – what have you learned from these? Has anything impacted you in a particular way? Ask what motivates you and your family members. Choosing your area of interest may come from your own journey. For example, the first charity I chose to become involved with was Sheena’s Place. As a young woman, I had an eating disorder that I overcame, and I wanted to share my experience, build awareness, demystify eating disorders and help patients and families successfully recover.

Understand what inspires you to give, what motivates you, what are you compassionate about? What concerns you and what actions will you take to address those concerns? Be clear about your values and beliefs. Turn your displeasure with something into action.

Involve Family:

Strategic philanthropy is also a warm way to introduce children to thoughtful giving. Family members may have certain interests. Having family members involved in giving opportunities can provide for engagement and expression. Working together around shared values is important.

Defining a clear focus for your giving allows you to move from ad-hoc, reactionary giving to giving to causes which are most important to you. This type of focussed giving allows you to grow, and learn more about the issues you are influencing, and to achieve greater impact.

Once you and your family have determined the causes you wish involvement with, the next step is to develop a well thought out plan with rules of engagement and parameters for decision making.

Design your Vision and Mission statement:

Your vision is your long-term view of the kind of world you would like to see. The mission defines how you are going to try to achieve your vision. A vision and mission for a family can help guide the discussions, choose the causes and provide guidance to external organizations. These statements should be short and inspiring.

The Diana, Princess of Wales Memorial Fund  
Vision: Our vision is a world in which the rights of the disadvantaged are respected.
Mission: By giving grants to organizations, championing charitable causes, advocacy, campaigning and awareness-raising, we are working to secure sustainable improvements in the lives of the most disadvantaged people in the UK and around the world.

More examples of Mission Statements:

Our mission is to support individuals, families and friends affected by eating disorders to overcome barriers and provide effective community-based services at all stages of recovery. (Sheena’s Place)

Our mission is to fund the medical equipment necessary to provide high quality patient care. (Oakville Hospital Foundation)

Our mission is to Protect, Educate and Empower children to rise above adversity through the power of play. (Right to Play)

Our mission is to provide scholarships in the arts and music to underprivileged youth who want to pursue their talent and desire. (Private Foundation)

Our mission is for social justice, economic redistribution and racial harmony. We volunteer with and donate to organizations that involve people in confronting and changing the institutions and public policies that affect their lives. (Private Foundation)

Our mission is to mentor low-income youth in Canada’s inner cities to increase college and university graduation rates. (Private Foundation)

Your philanthropic mission statement should express your ambition about addressing a problem that you believe is dire. A philanthropic mission statement may include a clear and concise action, a target population, a geography and a desired outcome. Your mission statement will likely evolve with time and participation of family members. Ideally you want to articulate your goal, or mission, so that you can always refer to what it is you want to achieve with your giving.

Determine your Objectives:

What do you expect to change as a result of your giving? Is your objective to improve the local community? Is it to bring together the family? Clear objectives help you to set priorities, and then be able to look back and determine the impact of your giving. Your objectives should relate to the activities you undertake.

Determine your Aims:

How will you do it? What do you want to measure? Develop statements of intent for WHAT and HOW. The “what” might be “I want to increase the number of girls in school”. The HOW could be something like: “Design programming that engages girls so that they stay in school”.

Choosing your Causes:

Make a list of causes you wish to support and why. Choosing 2-3 causes as a starting point can allow you to develop a greater sense of the cause, its stakeholders and to determine how you can make a measurable difference. Choose 2-3 causes that align with your values, or Family Mission statement for philanthropy. Have your children and grandchildren research causes that interest them. You would be amazed at what they think about and what is important to them – it opens the door to incredible communication and family discussion. You may be surprised about what your family will teach you.

Philanthropy typically looks to preserve something of importance like your local symphony or arts community. Or it looks to improve outcomes for health, education, the impoverished, or the environment or many other things. By choosing 2-3 areas of concern for your giving, you can go deep rather than wide and make a more impactful difference. Determine your focus area. For instance, if it is health, what within the health arena is important to you? Is there a particular problem you want to help solve? The clearer your focus, the greater your impact.

In choosing the causes you wish to support, research the effectiveness, the finances, the board members, the employees, and the governance structure. Just like you might review an investment thesis, take the time to understand the effectiveness of the organization you wish to support. What is the difference the organization is making? How is it measured? Is the desired impact being achieved? Perhaps invite the organization to present to your family.

Ask yourself what level of involvement you and your family wish to have?  Do you want to volunteer, provide your expertise, fundraise, involve friends, and/or use your business network to provide skills? Or do you prefer to be on the sidelines, viewing at a distance? Getting involved will certainly increase your connection to your philanthropy.

As I became involved in our community, joining the local Oakville Hospital Foundation Board provided me with an amazing opportunity to be part of a new hospital build and fundraising campaign; and to understand much more about our Ontario health system and how important it is to have community funding for hospital equipment. I also learned to think a little differently about how charities operate, e.g., you cannot simply look at an expense ratio and compare it between charities to suggest one is better than another. As there is no set standard for an expense ratio, different charities may use different metrics. Each charity will have costs much like “for profit” businesses do – employees to pay, rent to pay, administration and reporting to complete. The key is understanding the inputs and outputs – e.g., if you want the best CEO, there is a cost. It is still a competitive world. And fundraising campaigns cost money. Programming costs money. Sometimes important programs have upfront costs before the benefits are gleaned such as in garnering monthly donors. The high short-term costs to acquire donors provides sustainability and predictability to the revenue stream longer-term. Typically, large capital campaigns have a period of higher expense ratios during the lead up to the campaign and during the first couple of years before pledges begin to roll in. It’s also important to understand the difference between restricted (least flexible and very focussed) and unrestricted funding (most flexible and can be used in areas of priority as determined by the charity).

I might also encourage you to think beyond the big high-profile charitable causes that are already well served and look to make a greater difference in underserved and underfunded areas. (Malcolm Gladwell’s podcast on this subject is a great one Also think about giving in the community you live in versus the community you work in. For instance giving through the United Way at work may compete for dollars with the United Way in your local home community, or the downtown hospitals near where you work might compete for dollars with the hospital in your home community.

Measuring Impact:

Designing a personal approach to philanthropy takes time – you may wish to start small, slowly engaging with organizations, feeling them out so to speak, gradually learning about how your gifts will make a difference.  As you learn more over time, you can focus on what you want to achieve and measure the impact your gifts can make. Once you understand what you want to achieve, you should set criteria and measure outcomes to determine the success of your efforts. Creating measurable impact requires patience, flexibility and long-term planning.  It can be a terrific way to engage family members and create a legacy.

An issue that sometimes plagues philanthropy can be a lack of measurement. This can be more difficult when trying to compare similar organizations. Questions you may wish to ask include:

  • What growth and impact do you expect to see over time?
  • What do you want to measure?
  • How does the organization evaluate its success?
  • What are the goals of the organization?
  • What are the activities, and do they support your mission?
  • Can they provide evidence-based results and evidence of impact?
  • Is there a strong management team and good corporate governance?
  • Who are the major donors?
  • Is the organization and its fundraising sustainable? What are the funding sources?
  • Are long term goals achievable and realistic?

We suggest you spend the first year tracking your giving and assessing how your contributions made a difference; and then plan for the next year based on your experiences.

See Beyond

Receive Market Commentary + Stewardship Insights.