Philanthropy Management The Empowered Institution. Services for Foundations and Nonprofit Organizations

Transcription

1 Philanthropy Management The Empowered Institution Services for Foundations and Nonprofit Organizations

2 2 Morgan Stanley

3 Contents Effective Altruism Operational excellence and the quest for a better world page 5 Focused Philanthropy Professional services for private foundations page 6 The Productive Nonprofit Addressing the challenges of running an effective 501(c)(3) organization page 8 Strength Across the Board Education, programming and tools on how to be an exemplary board page 12 Donor-Advised Fund Programs Private Label DAF, Donor-Sponsored Supporting Organization and Society Foundation DAF page 14 Investing with Impact Services to help align investment strategies with philanthropic goals page 16 The Talent at Your Disposal The Morgan Stanley Philanthropy Management team page 20 Putting it all together The full range of support and counsel page 22 Supporting Your Efforts to Create a Better World page 23 There is no failure except failure to serve one s purpose. Henry Ford graystone consulting 3

4 4 Morgan Stanley

5 Effective Altruism Operational excellence and the quest for a better world. P hilanthropic institutions like yours not only make indispensible contributions to the health, welfare, education and cultural vibrancy of our society, but also collectively constitute an important sector of our economy. In 2012, nonprofits alone accounted for 5.5% of American GDP. 1 That makes you part of a multitrillion-dollar industry with an astonishingly diverse range of commitments to improving the lives of billions of people in thousands of ways. You and your colleagues in the philanthropic community face formidable challenges. Whether philanthropy is your vocation or avocation, and whether you work for a nonprofit organization or for the foundations that support them, you must look continually to strengthen your governance, increase the efficiency of your operations and achieve consistently improving, measurable results in your areas of interest. At Morgan Stanley Philanthropy Management, we serve as an experienced and capable ally in these efforts. Our Philanthropy Management team provides a broad range of services designed to help nonprofit organizations (ranging from family foundations to some of the nation s largest nonprofits) refine and implement their strategies. We assist nonprofit organizations in identifying and implementing the most effective methods of funding and governing their institutions. We can help you address the most pressing challenges facing your organization. The services we provide are very much an extension of our work with ultra high net worth individuals. Working with both donors and the nonprofits they support, we have gained invaluable insights into the needs and inclinations of each. The result is a cross pollination that helps us connect donors and nonprofits and guide both toward the most effective ways to work together. In devoting a substantial amount of time to the service of others, you have an opportunity to make a positive impact in the world. We are committed to helping you make the most of that opportunity. graystone consulting 5

6 Focused Philanthropy Professional services for private foundations. A s private foundations grow in size and scope, they tend to develop more complex needs. The philanthropists who formed them, whether a family or a corporate management team, often find that proper administration requires more time, effort and specialized expertise than they are able to muster. Philanthropists may want to change the direction of their grant-making, particularly for those foundations that have outlived the founding patriarchs and matriarchs. Even the best-run foundations eventually discover the need for an outside perspective and supplemental expertise. At Morgan Stanley Philanthropy Management, we have helped dozens of corporate and family foundation boards overcome these obstacles by professionalizing their operations. Our specialists can help you evaluate and improve governance procedures, identify and recruit outside talent, arrange for the outsourcing of appropriate tasks and work with your board to instill a common sense of purpose around a well-defined strategy. We can also provide the experienced, unbiased perspective that your board, or your family, may occasionally need to help balance and resolve competing interests. professional leadership With an extensive network throughout the philanthropic community, the Morgan Stanley Philanthropy Management team and outside professionals can work with your board to evaluate, identify, recruit and develop outside leadership: Determine whether outside leadership is required Define the qualities and qualifications you need in an executive director or other key positions Recruit and screen candidates Remain compliant with IRS staffing regulations (e.g., determining when and how family members can be paid as foundation employees) Conduct specialized training and professional development opportunities board development and governance Should you determine that you need additional expertise or a fresh perspective on your board, our philanthropy specialists can help you fill the gap: Define the skills and background needed on your board, including succession planning Identify and recruit potential board members Consult on best practices in foundation governance Advise on board effectiveness and assessment conflict resolution and interpersonal dynamics People with the same goal for the foundation can have stark differences of opinion in the direction the foundation should take. The Morgan Stanley Philanthropy Management team works with families and other board members to help them resolve their differences and move forward in a productive fashion: 6 Morgan Stanley

7 Board retreats designed to create common focus Workshops focused on optimizing foundation governance Conflict resolution and mediation services Leadership succession and development administration of scholarship programs The IRS has very specific guidelines that foundations must follow if they wish to offer scholarships to assist individuals in gaining access to educational opportunities. Our philanthropy specialists and outside professionals are available to help your board design a program that both complies with and fulfills your programmatic intent: Determination of grant levels and qualifying criteria Compliance review to ensure program stays within IRS guidelines Assistance with recordkeeping and filing Monitor effectiveness and communicate results outsourced services Through Foundation Management Services, Morgan Stanley s referral relationship with Foundation Source, 2 our family and corporate foundation clients have a fully outsourced, sophisticated, turnkey, Web-based back-office solution at their disposal. Our relationship with Foundation Source, one of the nation s leading private foundation management firms, allows us to offer access to an extensive suite of back-office administration functions, including: Compliance monitoring Transaction processing Tax preparation and filing Financial and grant reporting Grant-matching services Administration of matching gift and volunteer programs Exercise expenditure responsibility for international grants online tools To help you gain further efficiencies, Foundation Source offers a Webbased platform for communicating, collaborating and managing your philanthropy, including: Charity research One-click granting Complete tracking of foundation activities Tracking of investment balances Easy access to grant history Customizable reports library graystone consulting 7

8 The Productive Nonprofit Addressing the challenges of running an effective 501(c)(3) organization. A ccording to a 2013 survey by the Center for Effective Philanthropy, only 52% of nonprofit leaders believe their foundation funders are aware of the challenges their organizations face. 3 In addition to the perennial need to maximize fundraising efforts, these challenges include the need to incorporate technology to improve the effectiveness of their operations, and, notably, to improve their staff leadership skills. Fully three-quarters of the nonprofit leaders reported that their organization struggled to meet the demand for their services, and more than half said that those struggles had not been fully successful. 4 At Morgan Stanley Philanthropy Management, we have worked with an extensive and uncommonly diverse clientele of nonprofit organizations, helping them address the formidable challenges of sustaining their institutions. We have helped nonprofits refine and communicate their strategies, improve governance, bolster fundraising initiatives and improve the administrative processes. We have provided introductions to donors, potential board members and other nonprofits with aligned ambitions and interests. Our goal is to provide the full range of experience, expertise and introductions you need to address your challenges and pursue the mission of your institution. We offer guidance on crowdfunding, one of the newest and most innovative ways of raising charitable dollars. Crowdfunding is the collection of funds through small donations from many parties in order to raise money for a specific cause or project. Traditional corporate philanthropy has involved picking nonprofits to sponsor and presenting them with checks. Now, by using a crowdsourcing site such as Crowdrise and by offering monetary prizes to the charities that raise the most money during a crowdsourcing challenge, a corporation creates a friendly competition, which offers the potential of raising exponentially more charitable dollars. We assist both corporations that sponsor crowdsourcing challenges and nonprofits that compete in such events. 8 Morgan Stanley

9 FORMULATING STRATEGY We can advise your boards and executive leadership on a broad range of issues pertaining to their strategic direction. Implement capacity-building and feasibility studies Create strategic plans and capacity-building programs Determine, with outside professionals, the most appropriate legal structure for early-stage nonprofits Develop and/or refine charitable missions and programming IMPROVING GOVERNANCE We help you identify, recruit and train effective people at every level. Evaluate and retool governance policies Develop programs for volunteers and interns Identify and assist in recruiting high-impact board members and plan for succession Write tailored administrative guides and templates to assist in governance Identify and assist in recruiting executive directors, development professionals and other staff members graystone consulting 9

10 The Productive Nonprofit Evaluate current state of finances, track record, capacity and capabilities Make recommendations for optimal resource allocation STREAMING OPERATIONS Our experts work with your staff to assess your operations, understand industry best practices and make adjustments to improve your productivity MAKING CONNECTIONS We work to tie all of our clients into the broader philanthropic community, helping to form effective associations with donors and other nonprofits with complementary interests 10 Morgan Stanley

11 Administer donor-sponsored supporting organizations Advise on optimal fundraising techniques RAISING MONEY We offer consultative services on best practices in fundraising, along with a variety of specialized services to help you work effectively with major donors Broker large monetary gifts to effectively structure partnerships with private foundations and donors Develop planned giving programs Coordinate nonprofit site visits for foundations and donors Implement Private Label donor-advised funds Develop mission and donor-based collaborations with other charitable organizations Examine the possibility of combining operations or collaborating with other organizations to reduce administrative costs and create economies of scale Facilitate board leadership programs with a focus on high-end fundraising Publish philanthropic journals, peer dialogue newsletters and the Morgan Stanley global nonprofit calendar that highlight the mission and work of nonprofit clients and give them a forum to share their stories of effecting significant change Share and develop knowledge that can lead to the successful execution of local and national scaling efforts Uncover areas of common interest between nonprofits and Morgan Stanley clients graystone consulting 11

12 Strength Across the Board Education, programming and tools on how to be an exemplary board. M organ Stanley s Philanthropy Management team has worked with scores of nonprofit boards, helping to build cohesion and develop positive working dynamics. In the process, we have had the opportunity to witness a variety of effective boards in action and have seen commonalities among them. We have come to understand that the power of a board lies in the diversity of experience and opinion it amalgamates. When this diversity is brought out in directed discussion, leading to clear and decisive action, the power of the group is unleashed. That s the dynamic we help boards create: we help institute the mechanisms for a productive debate that encourages issues to be explored from complementary perspectives, while allowing the board to still speak as one voice after the vote is taken. Education, programming and tools on how to be an exemplary board and volunteer modules on effective governance include: setting targets: Effective boards have a clear understanding of shortand long-term goals that will help achieve the nonprofit s mission. Because of the nonprofit structure, fundraising is hugely important to the nonprofit s viability. We teach boards how to develop a public narrative that will be a successful tool in their fundraising efforts. conducting swot analysis: On an annual basis, the board should conduct a SWOT analysis. This helps identify the nonprofit s Strengths, Weaknesses, Opportunities and Threats. Once the board has discussed these items and selected the most critical ones, the board should develop an action plan. It is also important for the board to discuss an acceptable level of risk. optimizing volunteers: The board is a group of volunteers. The board members seek to assist the staff with meeting its goals. All board members must remember that the nonprofit s viability depends on the service the board provides. The board should make every effort to educate the community about the nonprofit s mission. assessing board performance: Assess the performance of the board s leadership in terms of achieving outcomes. Was the board effective? Did the board comply with its policies? How can these findings be applied to improve performance next year? The board should conduct a self-evaluation and also solicit performance feedback from staff. 12 Morgan Stanley

13 PHILANTHROPY IN ACTION Coaching in Fundraising Philanthropy Management helped a nonprofit client s director of development improve her fundraising technique. We coached her in presenting the nonprofit s mission in a compelling and personal way. Then, we role-played as donors being asked to make a six-figure major gift, critiqued her pitch afterwards and made introductions to several grant-making foundations interested in the nonprofit s focus. Donor-Sponsored Supporting Organization Solution A client was running a for-profit jewelry company, promoting tradenot-aid, to empower women in Africa. Her company could not effectively fundraise since it was not a public charity and therefore couldn t offer charitable income tax deductions for donations. Using a donor-sponsored supporting organization, she is able to now fundraise for her programs, employing women in Africa, and build a school to ensure their children have access to primary education, which will help prevent a life of poverty for the next generation. Nonprofit Board Recruitment A retired client with a passion for classical music asked for Philanthropy Management s assistance in helping him become a board member of a music nonprofit in Washington, D.C. We drew upon our network of music nonprofits and identified ones that matched his interests and give-or-get expectations. After coaching him through the interview process, the client was delighted to be invited to sit on the board of a nonprofit that brings classical music performers to hospital patients. graystone consulting 13

14 Donor-Advised Fund Programs Private Label DAF, Donor-Sponsored Supporting Organization and Society Foundation DAF. the private label donor-advised fund Looking for new ways to strengthen relationships with donors? A number of our nonprofit clients have explored the possibility of setting up donor-advised fund programs. Some clients, who have determined that they do not have the resources to set up and administer their own donor-advised programs, have turned to a Private Label donor-advised fund. This option can be a convenient and cost-effective alternative. Morgan Stanley Global Impact Funding Trust, Inc. (MS GIFT, Inc.), the firm s donor-advised fund, offers a Private Label DAF (the Fund ). The Fund is a turnkey solution that is branded in the name of your nonprofit. This option frees your organization from the administrative and investment management burdens of managing the Fund, allowing your staff to focus exclusively on marketing the program to your donor base. how it works A nonprofit (the Nonprofit ) receives contributions of cash, as well as appreciated or illiquid securities, private company stock, real estate, life insurance, fine art, antiques and other assets 5, from its donors (the Supporter ). The Nonprofit may contribute the donated property to MS GIFT, Inc. for the purpose of establishing a donor-advised fund in the name of the Nonprofit s Supporter. The Nonprofit may name the Supporter to serve as an advisor to the donor-advised fund account, with the ability to select investments and recommend grants. The Nonprofit is responsible for sending an acknowledgement letter to the Supporter. MS GIFT, Inc. will place assets that it receives from the Nonprofit in a separate repository within the existing donoradvised fund that carries the Nonprofit s brand. The Nonprofit s Supporters access their donor-advised fund accounts through a custom-branded portal to maintain the look and feel of the sponsoring nonprofit.

15 donor-sponsored supporting organization Because of the way in which a donoradvised fund is organized, it is generally difficult to fund an account through broad-based fundraising efforts. However, a donor who is interested in engaging in fundraising activities may create a separate organization (referred to herein as a donor-sponsored supporting organization ) to engage in those activities for the benefit of MS GIFT, Inc. A supporting organization is a separate charitable entity formed to support or benefit another public charity, such as MS GIFT, Inc., and which is itself exempt from federal income tax. Each donor-sponsored supporting organization will be registered with the Internal Revenue Service and also will be registered in each state in which it fundraises so that it may legally solicit funds from the public. A donor-sponsored supporting organization will engage solely in fundraising activities for the benefit of MS GIFT, Inc., and will be required to distribute all of its income, net of certain expenses and provision for a cash reserve to cover future costs, to a donor-advised fund account associated with the organization. Any money transferred from the donor-sponsored supporting organization to a donor-advised fund may then be distributed in the form of grants. society foundation The Society Foundation Donor- Advised Fund Program combines the best aspects of a donor-advised fund and a private foundation by providing favorable tax treatment, ease of administration and an opportunity to involve family and friends in charitable decision-making. Each Society Foundation is organized as a single-member limited liability company, the sole member of which is MS GIFT, Inc. This means that contributions made to a Society Foundation are treated, for tax purposes, as being made directly to MS GIFT, Inc. Because MS GIFT, Inc. is a public charity for income tax purposes, these contributions may receive more favorable tax treatment than if they were made to a private foundation. The Society Foundation is governed by a board of managers that may include individuals nominated by the founder and MS GIFT, Inc.

16 Investing With Impact Services to help align investment strategies with philanthropic goals. A n increasing number of foundations, institutional endowments and individuals wish to invest in a manner that is consistent with their beliefs, values and philanthropic agendas. In fact, nearly one in nine dollars under professional management in the United States or about $3.31 trillion 6 follows investment strategies that consider corporate responsibility and societal impact. The Morgan Stanley Investing with Impact Platform was built to facilitate these efforts. Our platform provides a wealth of information that helps you identify opportunities to address and realize your goals from both a financial and social-impact perspective: Categorization of funds by type of impact to help you and your Graystone Consulting Institutional Consultant prioritize your investment and impact goals A product matrix that aligns with various impact goals, including exchange-traded funds, mutual funds, separately managed accounts, private equity products and other investment vehicles Product- and manager-specific reports that provide more detail about each manager s investment approach Educational and thought leadership materials offering in-depth analysis on impact investing issues PHILANTHROPY BY THE NUMBERS (2013) Foundations: $50.28 bn Individuals: $ bn 7 16 Morgan Stanley

17 PHILANTHROPY IN ACTION Private Label DAF Solution An international nonprofit with dozens of local chapters was running over 40 separate donor-advised funds. By leveraging our Private Label Donor-Advised Fund Program, the organization is now able to concentrate on donor development and fundraising, while avoiding the risks of running multiple separate donor-advised funds. Society Foundation DAF Solution A family foundation, formerly led by the patriarch of the family, was not interested in continuing to manage the oversight and risk of the foundation upon the patriarch s death. The grandchildren, who were raised to appreciate and participate in the family s philanthropic enterprise, wanted to continue the grantmaking work without the burden of the administration and cost of managing a large private foundation. The Society Foundation was an excellent solution to accomplish all of the family s goals. The grandchildren continue the legacy of giving, started by their grandfather, but do not have the responsibility of running the foundation on a daily basis. The grandchildren also do not have a requirement to distribute a minimum percentage of the organization s assets each year (as they did with the private foundation). Any additional contributions that the grandchildren choose to make also will receive the favorable tax treatment afforded to public charities. graystone consulting 17

18 Investing With Impact Services to help align investment strategies with philanthropic goals. Morgan Stanley s Investing with Impact Platform enables clients to align investment decisions with larger societal and/or environmental priorities. To help your foundation or endowment make investment decisions that further your philanthropic goals, Morgan Stanley developed a framework that delineates four distinct approaches. As you move through the framework, the impact of each category becomes increasingly specific, overt and explicitly integrated into the product offering. Building on Morgan Stanley s strong wealth management platform and offering access to skilled managers and investment strategies, the Investing with Impact Platform offers a solid basis for those looking to invest toward social and environmental improvement. The platform represents the first phase in our effort to meet your desire for investment opportunities that support positive change without sacrificing financial performance potential. 18 Morgan Stanley

19 Values Alignment Environment, Social and Governance (ESG) Integration Sector Exposure Impact Investing impact priorities Screen by interests and values. Avoid investments in potentially objectionable companies and industries Identify managers that target companies whose approach to environmental, social or governance issues creates value differentiation Focus on themes and sectors targeting specific environmental or social changes Participate in investment funds that focus on providing capital directly to private enterprises structured to effect positive social or environmental change Not actively seeking environmental and social impact characteristics Public equity and debt Public equity and debt Public equity and debt Private equity and private debt Differentiated by screening criteria and degree of shareholder advocacy Differentiated by manner of ESG integration and degree of shareholder advocacy Differentiated by industry or sector focus May have investor restrictions Differentiated by integration of financial thesis and mission Might offer social and/or environmental reporting investment examples A mutual fund that excludes tobacco or firearms companies A mutual fund that includes ESG analysis as part of its investment process An exchange-traded fund (ETF) composed of clean energy stocks A private equity fund focused on emerging consumers or projectlevel, renewable energy investment minimize negative impact target specific positive impacts graystone consulting 19

20 The Talent at Your Disposal The Philanthropy Management team is a group of highly accomplished professionals who have the experience, expertise and connections to help your foundation or nonprofit organization fulfill its mission. Melanie Schnoll-Begun Managing Director Melanie Schnoll-Begun leads Morgan Stanley s Philanthropy Management and exemplifies her professional work by living a life of committed action. For over 18 years she has worked with the firm s wealthiest and most influential clients. She develops focus areas for clients philanthropy; engages senior and millennial generations in their foundations governance; designs customized grant portfolios; aligns client values with impactful investing; and facilitates giving circles, board retreats and educational events. In 2000, Melanie launched Morgan Stanley GIFT, the firm s global donor-advised fund. In 2012, she launched Foundation Management Services, a philanthropic advisory and administrative services platform for corporate and private foundations. She is also responsible for the firm s Nonprofit and Endowment Consulting Services. Melanie is a thought leader. She was honored in May 2014 by the Rotary Club of Verrazano as Humanitarian of the Year, and in June 2013 received the Juvenile Diabetes Research Foundation s Perseverance Award. She is the co-editor of Morgan Stanley s Perspectives in Philanthropy and is a popular speaker. She has published articles in the Journal of Taxation, has been quoted in The New York Times, The Wall Street Journal, Barron s, Bloomberg and Investment News, and has appeared on such programs as Good Morning America and CBS News. Melanie received her law degree from Quinnipiac University Law School. Melanie is an insightful and tireless advocate. She is the current nominating chair and former board president of the JDRF New York City chapter. She serves as Morgan Stanley GIFT s board president and on the advisory boards of the Naomi Berrie Diabetes Center, Quinnipiac University Law School and Grameen America. She lives in New York City with her husband and two boys and has a passion for golf, marathons and triathlons, which she competes in to raise awareness and funding for her charitable causes. 20 Morgan Stanley

21 Steven J. Rosandich Vice President Senior Philanthropic Advisor Steven J. Rosandich develops new charitable products and consulting services for high net worth clients. He conducts due diligence on nonprofit organizations and analyzes legal and taxation issues related to charitable giving. Steven helps clients identify innovative giving strategies; track the effectiveness of charitable dollars and engage in effective grant-making. Steven joined the firm in Steven has extensive experience in the field of compliance and state regulations and frequently writes on issues related to charitable planning. He is co-editor of Perspectives in Philanthropy, Morgan Stanley Philanthropy Management s client journal. He is also responsible for overseeing the production of the Morgan Stanley annual Philanthropy Calendar. In 2011, he co-authored the article Simple Tests Can Save Countless Lives, which appeared in Perspectives in Philanthropy 5, Medical Philanthropy and Global Healthcare. Steven authored the publications Primer on Planned Giving, Best Practices for Private Foundations What They Must Do, Must Not Do and May Do and Guidelines for Charitable Giving in Turbulent Times. He also co-authored the white paper, Giving Without Guilt: Helping Women Realize Their Full Giving Potential. Steven has served on the junior committee of the Federation of Protestant Welfare Agencies and on the advisory committee of NURTUREArt. Steven is an engaged community supporter of the Little Sisters of the Assumption Family Health Service and the New York City Anti-Violence Project. Steven received his B.A. in anthropology from Yale University and his J.D. from the Benjamin Cardozo School of Law. Steven is Series 7, 24 and 63 licensed. graystone consulting 21

22 Putting It All Together We provide the full range of support and counsel you need to develop, implement and maintain a strategically sound philanthropic program. A NONPROFIT IN TRANSITION 1 the circumstances A nonprofit board, micromanaging the organization s day-to-day operations, is lowering the staff s morale. Board members, while making generous gifts themselves, feel uncomfortable fundraising, and, in particular, asking for six-figure major gifts. The nonprofit, which focuses on autism research, has a board that lacks expertise in social media. 2 the engagement Philanthropy Management led a board retreat on best governance procedures, including differentiating between the staff s day-to-day operations role versus the board s oversight role. Philanthropy Management facilitated a fundraising program with the board to address ways to convey the nonprofit s mission to donors most effectively and how to ask for six-figure major gifts. Philanthropy Management, with its extensive network, identified a number of possible board members who had an interest in autism research and a personal connection to the disease. 3 the results After attending the board retreat, the nonprofit board now makes a point of overseeing the staff and not micromanaging day-to-day operations. After attending the fundraising program, the nonprofit board has created individual public narratives so they can comfortably discuss why they volunteer, what the organization is accomplishing and how funds raised are effectively being used. The board is now much more comfortable with fundraising and asking for six-figure major gifts. A new board member, with extensive corporate contacts and a personal connection to autism, was recruited to join the board. 22 Morgan Stanley

23 Supporting Your Efforts to Create a Better World Without the vital contributions of nonprofit organizations and the foundations that support them, our world would be a far bleaker place. In countless ways, the philanthropic community addresses our most basic needs and underwrites the pursuit of our loftiest ambitions. At Morgan Stanley Philanthropy Management, we are proud to play a role in helping scores of these foundations and nonprofit organizations pursue their missions. Our team provides advice, insight, introductions and administrative services to help you create the change you want to see in the world, efficiently, strategically and successfully. We can augment the resources of your foundation or nonprofit, simplifying your administration and freeing your time to focus on the primary missions of your organization. We are dedicated to helping you do your work more effectively, so you can create the change you want to see in the world. graystone consulting 23

24 references 1 Source: Urban Institute National Center for Charitable Statistics. Available at: 2 Morgan Stanley and its affiliates (the Firm ) do not currently offer the services provided by this Service Provider(s). The Service Provider(s) is not an affiliate of the Firm. Any review of the Service Provider(s) performed by the Firm was based on information from sources that we believe are reliable but we cannot guarantee its accuracy or completeness. This referral should in no way be considered to be a solicitation by the Firm for business on behalf of the Service Provider(s). The Firm makes no representations regarding the suitability or otherwise of the products or services provided by the Service Provider(s). There may be additional service providers for comparative purposes. If you choose to contact the Service Provider(s), do thorough due diligence, and make your own independent decision. The Firm will not receive a referral fee for referring you to the Service Provider(s). The Firm is a diversified financial services company with millions of individual clients and corporations, institutions and governmental clients in several countries around the world. The Firm routinely enters into a variety of business relationships for which either the Firm receives compensation or pays for services, and such business relationships may include the named Service Provider(s), its employees or agents, or companies affiliated with the Service Provider(s). 3 Source: Centers for Effective Philanthropy. Available at: Source: Centers for Effective Philanthropy. Available at: Special due diligence review and Board approval may be required. 6 Source: Giving USA (2014). 7 U.S. SIF: The Forum for Sustainable and Responsible Investment, Report of Socially Responsible Investing Trends in the United States, Morgan Stanley GIFT, Inc. is an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, and Morgan Stanley Global Impact Funding Trust is a donor-advised fund. Various divisions of Morgan Stanley Smith Barney, LLC provide investment management services to Morgan Stanley GIFT. Morgan Stanley Smith Barney LLC, its affiliates, Financial Advisors and Private Wealth Advisors do not provide tax or legal advice. This material was not intended or written to be used, and it cannot be used, for the purpose of avoiding tax penalties that may be imposed on the taxpayer. Clients should consult their tax advisor for matters involving taxation and tax planning, and their attorney for matters involving trust and estate planning and other legal matters. Investments and services offered through Morgan Stanley Smith Barney LLC. Graystone Consulting is a business of Morgan Stanley Smith Barney LLC Investments and services offered through Morgan Stanley Smith Barney LLC. Member SIPC. Graystone Consulting is a business of Morgan Stanley. GC CRC CS /15