The secret of lasting change

The German constitution of 1949 states: "Property imposes obligations. Its use must also be for the common good'. There are probably very few texts in the whole world that contain such a principle. Moreover, it is not a new concept. "If I can do no good, then nothing more gives me joy," declared Prince Johann II von Liechtenstein (1840-1929), nicknamed 'the Good' precisely because of his well-known social and humanitarian initiatives. This commitment to the community is continued to this day by the Princely House and LGT. H.S.H. Prince Philipp von und zu Liechtenstein, LGT's Honorary Chairman, always reminds us that the original meaning of the German term "Vermögen", i.e. wealth, was "to be able", "to be able to do something" and that the term "financial means" only appeared later.

However, the idea that wealthy citizens should do something for the common good dates back to antiquity. Over time, the foundations and principles of philanthropy have steadily changed. "Today, much more value is placed on sustainability and on making philanthropic initiatives more effective," says Nina Hoas, Head of LGT Philanthropy Advisory, a team that accompanies LGT's clients through all phases of their philanthropic initiatives: starting with the definition of core values and area of operation, and continuing with the development of the philanthropic strategy, the planning of interventions and their implementation.

Effectiveness and efficiency

The entrepreneurial approach is a fundamental element of philanthropy. "We manage our philanthropic activities in the same way as we do our other lines of business," explains Turkish entrepreneur and philanthropist Emine Sabanc_ Kam_l_ in an interview for "LGT Leitfaden zur strategi-schen Philanthropie". The aim of venture philanthropy and impact investing is not only to 'do good', but also to achieve the best possible results with the available means, be they financial means or specific know-how, partnerships and relational networks.

"For me and my family, it is very important to structure philanthropic initiatives in such a way that they contribute effectively and efficiently to positive and sustainable change, explains H.S.H. Prince Max von und zu Liechtenstein. As early as 2007, the LGT Chairman founded LGT Venture Philanthropy with the aim of improving the quality of life of less fortunate people, supporting virtuous ecosystems and contributing to the creation of resilient, inclusive and prosperous communities. In 2021, all Princely Family activities aimed at impact investing were centralized in Lightrock, a division of the LGT Group. "For the creation and development of Lightrock and its projects, we worked together with other families and a team of experts," summarises HRH Prince Max. "This collaboration has been both fruitful and fun."

Increasing the impact

Nina Hoas sees this as the right approach: "Those who have a health problem go to a doctor, those who have to resolve a legal issue go to a lawyer. But hardly anyone knows that there are also experts who can help you maximise your philanthropic activities in terms of positive impact". This is precisely what Nina Hoas and her team do in all areas of philanthropy, in a journey that often spans several generations. "A journey that starts with developing a clear vision and defining a precise mission," says Nina Hoas. "On the basis of this, a philanthropic strategy and action plan can be outlined with a view to constructive long-term development". Both new philanthropists and those who have been doing philanthropic work for several years benefit from the LGT Philanthropy Advisory. "Experienced philanthropists also seek the support of an advisor who specialises in new topics and wants to learn about new opportunities in the philanthropic field," Nina Hoas says on the basis of direct experience gained over time. "They also want to exchange with people who have the same interests as them and with other experts in the field."

Improving impact

Willingness to do good and altruism are not lacking. However, social and environmental issues are sometimes so complex that it is very difficult to bring about meaningful change. "I often think of those who start out with the best intentions but do not achieve the desired results or effects," Nina Hoas argues. "It can depend on governance issues or poor alignment within the family. Sometimes it also depends on a lack of strategy, because one acts purely 'for the sake of helping' or because one does not know the problem thoroughly and therefore cannot take the most appropriate measures. Strategic philanthropy and social impact investments are the secret to stable change over time'.