How to: give to charity

Lawyers commonly publicise the good work they do by way of pro bono legal advice and projects where staff and partners help out community projects – from assisting local children with their reading to conservation work. Pro bono, which is drilled into solicitors from an early stage, is ‘in a lawyer’s DNA’.

Straightforward acts of financial largesse are less celebrated. Anyone who has been involved in keeping a charity or good cause going will know that, although services-in-kind are important and valued, cold, hard cash is an absolute necessity. The infrastructure that volunteerism relies upon costs money. Research scientists working on cures for diseases cannot work for free; and full-time specialist staff are needed to guide the efforts of lawyers who are keen to do their bit.

The comparatively low profile which legal sector philanthropy of this nature has gained seems largely to reflect the motivation of lawyers and law firms that are doing the giving. Indeed, it took some asking around to find people who wanted to talk on the record about financial philanthropy, because it is not commonly linked explicitly to business development.

Paul Brampton, chair of trustees at IBB [south-east firm IBB Solicitors] Charitable Trust, says there is a reason for this: ‘A common mistake that companies make is deciding to set up a charitable foundation to “tick a corporate social responsibility box”. They end up with something that is little more than a PR exercise. The sole purpose of the trust or foundation has to be that it is set up for public benefit.’

Tony Williams, principal of legal sector consultancy Jomati and a former managing partner of Anderson Legal and Clifford Chance, recalls his own motivation for setting up the Jomati Foundation: ‘We are a group of more senior people. The law had been good to us, and we felt we should give something back.’ The foundation is funded by 5% of the consultancy’s fee income.

On the notion of publicity, Williams says: ‘Everyone struggles with this a bit.’ In part, he admits this is a reaction to the perception that in the pro bono arena some firms over-claim on the value of work done, often measured by chargeable hours completed at a lawyer’s commercial hourly rate. ‘It’s only a [credible] metric if you are turning work away to do pro bono,’ he observes.

For the Jomati Foundation, the legal bursaries it provides to students need to be discoverable, he notes, but there is little active promotion otherwise, though grants made to other causes are listed online.

The purpose of giving as a collective, rather than leaving donations to individuals in their private life, is that grants can be made in a way that is more likely to transform a good project, charity or set of activities. The aim is ‘to achieve results’, Peter Forshaw, corporate social responsibility partner at national firm Weightmans, stresses.

Williams adds: ‘Our approach is that we are not going to transform a big charity [with a donation]. With smaller projects we will have a bigger effect: £5,000, £10,000, £15,000 – these sums can help get something off the ground. In some cases that unlocks matched funding. It’s a relatively micro-level game.’

Magic circle firm Linklaters opts to connect many donations to its pro bono programme. A spokesperson explains that 0.5% of pre-tax profit is allocated each year to charitable causes: ‘That is matched by a commitment to contribute at least the same amount in time.’

This represents just a fraction of the firm’s wider pro bono commitments, though the link is made as a way of increasing the impact of the work. Thus, ‘funding is complemented by skills-based volunteering’.  

Part of the effectiveness of giving as a firm can come from the ease with which a set of criteria can be applied to decisions. The principles underpinning donations are usually widely drawn, but setting and keeping to them is important.

Bernadette O’Sullivan, CSR and charitable trust coordinator at global law firm Dentons, explains: ‘We support charities that have a connection to our communities and practice areas, and have a particular focus on East London. They support people with disabilities, the elderly, children and support education projects and the rehabilitation of ex-offenders.’

‘Choosing which charities to donate to requires the application of consistent criteria,’ IBB’s Brampton advises, ‘which you will have set at the time of forming your charitable foundation. Ensure that you document good reasons for approving or rejecting donation requests. And if you do deviate from your criteria, be clear about why you are doing so and make sure that your grant-making policy allows you to take into account exceptional circumstances.’

Bernadette O’Sullivan, CSR and charitable trust coordinator at Dentons, explains her firm’s criteria for giving.

Linklaters says two broad themes govern its giving. Under ‘realising aspirations’, donations and activity focus on projects aimed at young people, such as the firm’s work with the Clapton Girls’ Academy. Second is ‘growing capabilities’, including support for East London regeneration projects that also required structured finance advice on bonds needed for £7.5m of social investment.

Each Weightmans office chooses a local charity, Forshaw says, but some are chosen centrally, including the Christmas charity. For the latter, he says: ‘The broad criteria are that it should be: different every year; a charity that will work in all of our regions; a charity which is not political or religious.’ Past examples include charities focused on homelessness and mental health. He adds: ‘[Our] target is local charities that would [otherwise] get overlooked.’

Committee decision

The structure for giving varies. Linklaters has opted not to set up a separate foundation, explains a spokeperson: ‘Some global donations are agreed by the corporate responsibility committee, which is a sub-committee of the partnership board. All other donations are agreed by local office committees. These are composed of partners, lawyers and business services staff, and tend to meet quarterly to review existing projects and discuss new opportunities.’  

Each committee is supported by the firm’s central corporate responsibility team, which includes two community investment professionals who provide guidance on project selection, due diligence, volunteering, measurement and so on. Regular conference calls are used to share learning. Earlier this year, representatives from 15 offices attended a two-day session in London to develop knowledge further.

At Weightmans, Forshaw says: ‘We have a ringfenced account that gets split down into nominally coded funds that each office administers.’

Dentons, Jomati and IBB have all opted for a charitable trust or foundation model – which Forshaw says Weightmans may also adopt in time. ‘Setting up the foundation was staggeringly easy,’ Williams says. ‘We went to the Charity Commission website and downloaded a standard form. We made some amendments. The commission had comments on those, which we reflected. The accounts are signed off by an accountant, but that’s pretty much it.’

He adds: ‘The great advantage of this setup is that your gift aid is co-ordinated. It is administratively very easy.’  

A larger firm may require formalised governance arrangements. O’Sullivan explains how Dentons’ 21-year-old charitable trust works: ‘The partnership contributes an amount to the trust at the beginning of each financial year. There are four trustees, each a senior partner of the firm [including the] managing partner. We meet quarterly to consider applications, which I receive and present to the trustees in schedule form.’

On governance, Brampton advises: ‘Trustees will likely be drawn from the firm, but they must put aside thoughts of any “company benefit” and must make decisions that benefit the charity. This needs to be in line with the charitable aims you have set out in your constitution.’

The trustees, Brampton notes, must keep a close watch for potential conflicts: ‘Charities of all sorts will run into conflicts of interest from time to time. You need to be able to spot them, prevent them, and be transparent about them by recording the steps you have taken to prevent conflicts with the charity’s aims.’

He adds: ‘Again, the Charity Commission has some excellent guidance on how you can identify  and deal with conflicts of interest and loyalty, such as conflicted trustees withdrawing from discussions and decision-making.’

Of course, it is important to be as inclusive as possible in involving partners and staff in a firm’s charitable commitment. That has nothing to do with publicity but rather internal morale and motivation.  

‘Our charitable trust has a board of trustees who are all partners of the firm, but they consider grant applications from a shortlist compiled by a giving committee,’ Brampton says. ‘The giving committee is drawn from every level of the firm, and meets once a quarter to review and recommend which funding requests should be put forward to the trustees. The giving committee also organises staff fundraising initiatives to involve the wider firm.’

That ongoing commitment also precludes a situation developing where a firm has chosen to ‘donate and run’, Brampton advises: ‘Try to form ongoing relationships with the projects you support through visits and donations in kind.’

Eduardo Reyes is Gazette features editor