25th April 2023
Donor Advised Funds (DAFs) are an excellent option for private companies looking to engage in corporate philanthropy, offering organisations an alternative to setting up their own foundation. This allows them to select the organisations they want to grant to without the liability and responsibility of creating a foundation, in a process known as ‘white labelling’ for corporate giving. Prism also offers a unique model – a Collective Fund – to allow a lead donor or group to raise funds from multiple donors for a ringfenced cause or charitable purpose.
Matrix Chambers, a barristers’ chambers based in Gray’s Inn in London, set up a hybrid DAF and Collective Fund with Prism in 2017 allowing the company to collate funding from their members. By managing the nuanced administration, due diligence, governance and compliance for the Matrix Causes Fund, Prism allows the organisation and the contributing members to focus on supporting organisations which promote access to justice, equality of opportunity, or a sustainable environment. On behalf of Matrix Causes Fund, Prism has distributed £1m to a range of fantastic charitable initiatives.
How does it work?
Barristers at Matrix Chambers chose to contribute a set percentage of their monthly income to the fund. Twice a year, the Matrix Causes Fund Committee considers applications for funding from UK and overseas organisations which meet the impact criteria for grants. The chosen project proposals are shared with Prism who then carry out due diligence on the proposed grantees.
What is the advantage to Matrix Chambers?
As a DAF under the auspices of Prism, the Matrix Causes Fund benefits from Prism’s bespoke, personal service. Like all Prism clients, the Matrix Causes Fund has a dedicated relationship manager at Prism who has oversight over the account and carries out the due diligence on each grant recipient. As Prism is a UK registered charity, the contributors to the Fund can benefit from Gift Aid, increasing all eligible contributions by 25%. Prism provides each contributor to the fund with a tax statement at the end of the fiscal year showing the gross amount they have donated via the fund for their tax return.
In having a DAF, Matrix Chambers does not need to use internal resources to manage their giving. Instead, Matrix Chambers benefits from the expertise of Prism’s knowledgeable and experienced board of trustees, and leaves administration in the hands of their relationship manager, who ensures charitable giving remains in line with the Charity Commission requirements. This allows the Matrix Causes Fund contributors and committee to focus on selecting impactful projects to fund.
Impact of the Matrix Causes Fund
By way of example, Matrix Causes Fund supported charity Key4Life with a donation in 2021. Key4Life is a UK charity working to reduce youth re-offending by delivering an innovative rehabilitation programme to people in prison and those at risk of offending. Only 16% of those participating in Key4Life’s programmes have re-offended, compared to the national rate of 64% post release. Via Prism, the Matrix Causes Fund pledged to donate £3,000 annually for three years to fund training for young men who have successfully completed Key4Life’s Prison or At-Risk programmes and now help others through peer mentoring.
There are many ways in which Donor Advised Funds and Collective Funds can work for corporate companies looking to establish charitable vehicles for corporate giving and fundraising from employees’ contributions.
If you think your organisation could benefit from a similar corporate giving structure and service administered by Prism the Gift Fund, please contact us on 020 7486 7760 or contact our Deputy CEO: Adiva Kalms – [email protected].
