"We have arrived at a moment in history when two specific and typically invisible phenomena — wealth management and private philanthropy — are suddenly in view, illustrating many of the themes that are currently 'hot' in our culture...Philanthropy is at the intersection of these complex social currents."

So state the authors of Generations of Giving, a book based on a study of thirty Canadian and American family foundations that have been in existence for at least two generations. The study suggests that as new wealthy families attempt to determine how philanthropy fits into their values and lifestyles, many of these families will choose to manage their philanthropy through family foundations. The authors cite statistics that approximately 40,000 family foundations with more than $175 billion in assets are currently in existence, and new family foundations are being formed at the rate of more than 5,000 each year. (The latest Foundation Center statistics on family foundations were released in January 2005 at: http://fdncenter.org/research/trends_analysis/pdf/key_facts_fam.pdf.)

The study focuses on why these foundations were created and how they evolved, ranging from family involvement to how the foundations approached accomplishing their missions. The authors emphasize that the study is not really about grantmaking but is primarily concerned with "governance and continuity," or how these families organized themselves to reach their goals.

The foundations studied vary significantly in many ways. Some are older, some younger; some remain local funders, some have grown to fund on a wider scale; some have changed little since the founder started the foundation, some have changed drastically. Some family foundations are well-known names — Pew, Gates, Turner — with large endowments and the grantmaking power to have a major impact on health and social issues, while ninety-nine per cent of all family foundations have less than $100 million in assets. But they have all had to face a common set of challenges: deciding whom and what to fund, managing their assets, and complying with laws and regulations.

The book looks at "stages and transitions" in the lives of these foundations. Part 1 describes the study and puts the family foundation into historical context. Part 2 uses the primary data from the cases to illustrate the three typical stages of foundation development as well as the transitions from one stage to another. Part 3 focuses on four themes: mission and dream, family dynamics, organizational structure and successor development.

One of the most important lessons the authors want the reader to come away with is that family foundations do not start out as such-most were established by an individual or couple with varying degrees of family involvement. The organizations profiled in the study became family foundations over time — through a series of stages and transitions — sometimes in spite of, not in agreement with, the founder.

The lead author, Kelin E. Gersick is a co-founder of and a senior partner at Lansberg, Gersick & Associates, a research and consulting firm in New Haven, Connecticut. He is a Management Fellow at the Yale School of Organization and Management and Professor Emeritus of Organizational Psychology at the California School of Professional Psychology.

This book explores some major questions about the nature and dynamics of family foundations using numerous interesting examples from the organizations surveyed. Academic in tone, it is intended more as a look at how family foundations have evolved over time than a practical guide to the issues concerning family foundations.

For citations to additional materials on this topic refer to the Literature of the Nonprofit Sector Online, using the subject heading "Family foundations" in the keyword search field.