Christina Tung said in an interview that there are three strategic steps as the component parts of an effective strategy for philanthropy.
First, is providing advice under a structured set up, for example whether to set up a charitable trust or foundation, or some kind of legal structure. Secondly, is how to do the giving in a strategic way. And thirdly, is making investment with social returns.
Families want to perpetuate family values and ensure cohesion among family members, said Tung. To do this, family members must be able to accommodate the aspirations across generations, as well as create a family governance model.
To do philanthropy, Tung said people need to take some risk – since they are looking into areas which governments or the business sector is not as focused as it could be.
Philanthropists therefore need to understand the issues, identify the potential areas of intervention, and identify the best strategies and local partners to help them achieve this.
Essentially, with the required strategic and operational planning, philanthropists need to apply their business skill-set, she explained.
Getting the most out of philanthropy
Measuring the impact of these initiatives is always challenging, said Tung. Some of the tools which can be used including setting key performance indicators – both in terms of quantifiable and non-quantifiable measures.
Philanthropists can then monitor these and see whether they need to change their strategy or approach.
In terms of external challenges, these include how to help to promote a larger and more effective Asian philanthropic sector, said Tung.
This means finding partners which are effective, scalable and transparent, and being able to collaborate and pool resources, as well as having professional management.
It is also important to have more supportive government regulations and policies, said Tung. For example, in the West, she said a lot of governments have policies which incentivise people for engaging in philanthropy.
While in Hong Kong, there are good tax incentives, this is not the case for some other Asian countries.
In addition, Tung said it is important that governments in Asia help build the region’s philanthropic sector and collaborate.
Misunderstanding in relation to philanthropy
According to Tung, people need to understand the difference between charity and philanthropy.
Charity is just writing a cheque, which is not strategic or sustainable, whereas philanthropy involves people applying their own skill-sets and measuring the impact to ensure sustainability, she explained.
Using professional advisers
Given that philanthropy is a lot of hard work to do effectively, Tung said it requires professional advice and management.
Families often need guidance on their initiatives to determine their areas to support and how to set up a structure to achieve this.
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