For many affluent families, philanthropy follows a familiar pattern. A request arrives — from a hospital, a university, a community organization — and a cheque is written. The gift is genuine, the intention is good, and the impact is real. But it is reactive rather than strategic, isolated rather than integrated, and it does not engage the next generation in any meaningful way.
Research by Bekkers and Wiepking (2011), published in their comprehensive literature review of over 500 studies on charitable giving, identified 8 distinct mechanisms that drive philanthropic behavior. Understanding these mechanisms transforms giving from a series of individual transactions into a coherent strategy that can last generations.
The 8 Mechanisms of Giving
Bekkers and Wiepking’s framework identifies the following drivers:
1. Awareness of need. People give when they become aware of a genuine need. This seems obvious, but it explains why disaster relief generates outsized donations while chronic problems receive less attention — visibility drives giving.
2. Solicitation. Being asked to give is one of the strongest predictors of giving. This is why charitable organizations invest heavily in fundraising — the act of asking activates giving behavior in ways that passive awareness does not.
3. Costs and benefits. Donors consider the financial implications of giving, including tax benefits. In Canada, the charitable donation tax credit provides a federal credit of 15% on the first $200 of donations and 29% on amounts above $200 (with an additional 4% for income above $235,675). Provincial credits add further benefit. These incentives do not typically motivate giving, but they influence the amount and timing.
4. Altruism. Genuine concern for the welfare of others is a primary motivator. Research consistently shows that altruistic motivation produces more sustained giving patterns than other mechanisms.
5. Reputation. Social recognition influences giving behavior. Named buildings, donor walls, and public acknowledgment tap into the human desire for social standing. This is not vanity — it is a deeply embedded social mechanism that philanthropic organizations have leveraged for centuries.
6. Psychological benefits. The “warm glow” of giving — the emotional satisfaction derived from helping others — is well-documented in behavioral research. Neuroscience studies have shown that giving activates the same reward circuits in the brain as receiving money.
7. Values. Deeply held moral, religious, or social values drive giving patterns. Value-driven donors tend to be the most consistent and the most resistant to fundraising fatigue.
8. Efficacy. Donors give more when they believe their gift will make a real difference. Perceived efficacy — the sense that one’s contribution actually matters — is critical to sustaining long-term giving.
Understanding these mechanisms is not academic exercise. A family that builds its philanthropy strategy around awareness, values, and efficacy will produce very different outcomes than one driven primarily by solicitation and tax benefits. The first approach creates lasting engagement. The second creates a pattern of reactive, transaction-based giving that often fades across generations.
The Next Generation Challenge
One of the most significant challenges in family philanthropy is engaging the next generation. Research by Goldseker and Moody (2017) in their study of next-generation donors — those who grew up in philanthropic families — reveals a clear generational shift in giving preferences.
Next-generation donors want hands-on engagement, not just cheque-writing. They want to understand the impact of their giving, participate in selecting causes, and contribute their time and skills — not just their family’s money. They are more likely to be motivated by measurable outcomes than by tradition or institutional loyalty.
This creates both a challenge and an opportunity for wealthy families. The challenge is that the giving patterns of the founding generation may not resonate with their children and grandchildren. A patriarch who has given to the same hospital for 30 years may find that his children care more about environmental sustainability or global health equity.
The opportunity is that philanthropy can become a powerful vehicle for family cohesion and values transmission — if it is structured to include the next generation in meaningful ways. Family foundations, giving circles, and donor-advised funds that involve multiple generations in decision-making can accomplish something that few other family activities can: bringing family members together around shared purpose.
Strategic Giving Vehicles in Canada
Canadian families have access to several powerful giving structures, each with distinct advantages:
Donor-Advised Funds (DAFs). DAFs have become one of the fastest-growing vehicles for strategic philanthropy in Canada, with over $13 billion in charitable assets held in Canadian DAFs according to CAGP/KCI research (2023). A DAF allows the donor to make an irrevocable contribution, receive an immediate tax receipt, and then recommend grants to qualified charities over time. The assets in the fund grow tax-free, amplifying the eventual impact.
DAFs are particularly powerful for year-end tax planning. A business owner who has an unusually high-income year can make a substantial contribution to a DAF, claim the charitable tax credit in the current year, and then distribute the funds to charities over the following years. This separates the tax benefit from the giving decision, allowing for more thoughtful philanthropy.
Private Foundations. For families with substantial philanthropic ambitions — typically $1 million or more in charitable capital — a private foundation offers maximum control and visibility. The foundation is a separate legal entity with its own board (often comprising family members), investment portfolio, and grant-making program.
The administrative burden is higher than a DAF — annual filings, a minimum disbursement quota of 3.5% of assets, and public disclosure of grants — but the benefits can be substantial. A private foundation can serve as a vehicle for family governance, providing a structured context for multi-generational decision-making about values, priorities, and impact.
Gifts of publicly traded securities. One of the most tax-efficient giving strategies in Canada is the donation of publicly traded securities with accrued capital gains. When securities are donated directly to a registered charity (or DAF), the donor receives a charitable tax receipt for the fair market value of the securities and pays zero capital gains tax on the accrued gain. For securities with significant unrealized gains, this can effectively reduce the cost of giving by 25% or more compared to selling the securities and donating the cash proceeds.
Charitable remainder trusts. For families seeking to balance philanthropic goals with income needs, a charitable remainder trust allows the donor to transfer assets into a trust, receive income from those assets during their lifetime, and direct the remainder to charity upon death. This provides a current tax benefit, ongoing income, and a guaranteed charitable legacy.
Building a Family Philanthropy Framework
The most effective family philanthropy strategies share several characteristics:
Articulated values. The family has explicitly discussed and documented the values that guide their giving. This does not require consensus on every cause — it requires a shared understanding of why the family gives and what it hopes to accomplish.
Structured participation. Family members across generations have defined roles in the philanthropic process — researching causes, evaluating proposals, making site visits, and reviewing impact. The structure ensures engagement without requiring unanimity.
Measurable impact. The family tracks the outcomes of its giving, not just the amounts. This connects the giving to the efficacy mechanism identified by Bekkers and Wiepking, sustaining motivation across generations.
Integration with wealth planning. Philanthropy is coordinated with the family’s broader financial, tax, and estate plans. Giving strategies are optimized for tax efficiency, and charitable commitments are reflected in the estate plan.
Questions to Ask Yourself
Consider these questions about your family’s approach to giving:
- Is your giving strategic and intentional, or primarily reactive — responding to solicitations as they arrive?
- Have you engaged the next generation in your philanthropic decisions, or is giving primarily a first-generation activity?
- Are you using the most tax-efficient giving vehicles available to you, or are you writing cheques without considering the structural alternatives?
These questions are not about giving more. They are about giving better — in ways that create deeper impact, stronger family bonds, and a philanthropic legacy that endures beyond any single generation.
Legacy as a Living Practice
The Wealth Drivers Pillars framework addresses philanthropy through 65 discovery questions that explore not just how a family gives but why it gives, who participates, and how giving connects to the family’s broader wealth and legacy strategy.
Philanthropy is one of the few areas of wealth management where financial strategy and human meaning converge completely. Done well, it creates impact that extends far beyond the family — and it gives the next generation a reason to see wealth not as a burden to manage but as a tool for the kind of change that matters to them.
The cheque is the beginning, not the end. The real work — and the real reward — lies in building something that lasts.