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Philanthropy in Luxembourg –
2008 - 2013
Paul Wilwertz, Banque de Luxembourg
EPSG
Luxembourg, 25th April 2013
Philanthropy 04/2013 | Banque de Luxembourg
Agenda
1. Banque de Luxembourg & philanthropy
2. Philanthopy: an opportunity for private banks?
3. Learning from our experience
4. Growing your business by investing in your framework
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Philanthropy 04/2013 | Banque de Luxembourg
About Banque de Luxembourg
• Founded in 1920
• One of the most important private banks in Luxembourg
• An international clientele base of private individuals, entrepreneurs
and wealthy families who we support throughout their lives
Philanthropy is a natural extension of our core business
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Philanthropy 04/2013 | Banque de Luxembourg
Why did we go into philanthropy?
• From CSR actor to an engaged philanthropy actor
• Response to growing demand from our clients and to
increasing solicitations
• Opportunity to differentiate ourselves
• Being a pioneer and a major player
• Put Luxembourg on the European philanthropy map with
positive impact on our own activity
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Philanthropy 04/2013 | Banque de Luxembourg
Agenda
1. Banque de Luxembourg & philanthropy
2. Philanthropy: an opportunity for private banks?
3. Learning from our experience
4. Growing your business by investing in your framework
5
Philanthropy 04/2013 | Banque de Luxembourg
Stating the needs
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Philanthropy 04/2013 | Banque de Luxembourg
Condition 1: be legitimate and add value!
Philanthropy:
• Fits naturally into the range of private banking services
trust/knowledge <-> philanthropy <-> money/assets
• Comes up naturally as a topic when discussing wealth
transmission
• Requires financial expertise
estate-planning and structuring, tax, asset management, etc
• Needs access to private banking tools
SRI, venture capital, microcredit, etc
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Philanthropy 04/2013 | Banque de Luxembourg
Condition 2: be ethical!
• Same ethical approach to philanthropy as to the business of banking − Client must have a genuine philanthropic intention at the
start − Philanthropy should not be used as a way of resolving
conflicts (rightful heirs, etc) or unclear situations
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Philanthropy 04/2013 | Banque de Luxembourg
Condition 3: each to his own
Client
Client adviser Listening out for philanthropy signals
Philanthropy adviser analyses needs - coordinates – sets up contacts
Wealth engineers / lawyers vehicle structuring
Umbrella foundation /
philanthropy consultants bring the project into being
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Philanthropy 04/2013 | Banque de Luxembourg
Agenda
1. Banque de Luxembourg & philanthropy
2. Philanthropy: an opportunity for private banks?
3. Learning from our experience
4. Growing your business by investing in your framework
10
Philanthropy 04/2013 | Banque de Luxembourg
Our services
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No desire to use philanthropy as a retention tool no Banque de Luxembourg foundation
Philanthropy 04/2013 | Banque de Luxembourg
Main benefits
Qualitative
Enhance knowledge of the client –
greater recognition from the client
Discussion provides renewal and
strengthen/deepens the client –
CRM relationship
We have become a key reference in the
philanthropy arena (wide range of contacts,
projects, enquiries, etc)
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Quantitative
(all or part of) the assets allocated to
charitable purposes can be kept at the bank
New assets (from competitors, property,
real-estate, …) may come to light and be
deposited
New prospects: children, friends of clients,
and prospects
Positive impact on our asset management
activities for foundations
Philanthropy 04/2013 | Banque de Luxembourg
Agenda
1. Banque de Luxembourg & philanthropy
2. Philanthropy: an opportunity for private banks?
3. Learning from our experience
4. Growing our business by investing in our framework
13
Philanthropy 04/2013 | Banque de Luxembourg
Philanthropy in Luxembourg in 2007
• an engaged player in development aid matters
• a robust and flexible legal framework for foundations
• access to the benefits of a major financial center:
• multi-jurisdiction specialists
• innovative products and markets (microfinance funds, SRI-funds, impact
investing…)
• high level of donor protection
• a variety of structures to meet the needs of donors with
international profiles
• classic public-benefit foundation
• International corporate foundations
• Impact investing foundations
• Foundations with European focus
• Foundation with the endowment in the form of company shares
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Philanthropy 04/2013 | Banque de Luxembourg
Philanthropy in Luxembourg in 2007
Areas of progress (cf. FSG white paper)
• Awareness of the need
• Tax treatment of donations
• Support and advice
• Outdated foundation law
• Information about potential beneficiaries
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Philanthropy 04/2013 | Banque de Luxembourg
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A systemic approach
Engineering of
impact
investing vehicles
2010 EVPA
Conference
in Luxembourg
Private Banking
Investment advice
SRI, micro-finance, … Private donors
advisory
To be
developped
Symposium 2008
Seizing the opportunity
for philanthropy
in Luxembourg
Umbrella
Foundation √
Evolution legal
and fiscal
environment √
Enhancing
Awareness
Symposium 2012
Philanthropy works
Asset
management
Asset management
of foundations
Symposium 2009
Responsable
Leadership
in times of change
More than 250
repr. of
European
Foundations
EIIL initiative
Professional
Banking
Philanthropy 04/2013 | Banque de Luxembourg
+ www.philanthopie.lu
How to engage banking and financial sector
to work with non-profit sector?
Philanthropy 04/2013 | Banque de Luxembourg
• Be selective!
• Who could be interested in your project and why?
• Would could have an interest in your project and what could it be?
• Try to identify the expected counterparts (visibility involvement)
• Be on the same wavelength concening the impact and give
feedback
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Philanthropy 04/2013 | Banque de Luxembourg
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The Banque de Luxembourg case
ROI No ROI
supporting the
non-for-profit sector
systemic
approach partnerships
Ex.: Red Cross shilanthropy
symposiums Ex. ICHEC
Philanthropy 04/2013 | Banque de Luxembourg
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• Supporting non-for-profit organisations and social entreprises
in structuring, consolidating, and professionnalising their
organisation / projects
• with
• skills
• and/or donations in kind (used PC …)
• and/or mortgages and guarantees
• and/or additional and occasional donations
Supporting the non-for-profit sector
Philanthropy 04/2013 | Banque de Luxembourg
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For the employee
• awareness and valorisation of
his/hers own competences
• application in an unknown
environnement
• openness, challenge
• giving sense
For the Bank
• challenge and proof of
concept on the field of its
skills in project
management
• « learning curve » (cf.
microfinance)
• decrease of sponsorship
budget
• incentive and « give back »
WIN – WIN - WIN
For the beneficiary
• « unaffordable » input
• no support for
« capacity building »
Why skills sponsorship ?
Philanthropy 04/2013 | Banque de Luxembourg
- Starting point: A heart for Ukraine (1994- 1997)
- Other major donations: renovation of the National Blood Transfusion
Center (2001-2004)
- Other supports: Tsunami, Social « Grocer’s shop », regular committment
to the Luxembourg-City section (bal, bazar,…)
- Skills sponsorship:
- Governance & communication
- O&I : CTS’s call center
- Web : new Intranet
- HR
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Working with the Red Cross