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Raymond James Asks RIAs To Donate Proportion of Fees to Charitable Causes

Raymond James Financial Services, a broker/dealer based in St. Petersburg, Fla., is trying charity as a new tack for selling mutual funds and other investments.

Raymond James has asked its network of 1,300 registered investment advisors to donate a quarter of their management fees or commissions to charities in their communities, making these donations in the names of their investors on a quarterly basis. The investors can donate to charities advisors suggest or select their own. However, since the financial advisors are the ones actually giving up a portion of their fees, they are entitled to deduct the donations on their taxes.

Raymond James' new Charitable Partners Program is not mandatory and "is not for everyone," said Clay Curtis, internal wholesaler at Raymond James. But the Charitable Partners Program has already attracted the interest of 20 financial advisors who have applied to participate since the firm introduced the program in late April, Curtis said.

If it is anywhere near as successful as it has been for the Raymond James affiliate that came up with the idea two years ago, Raymond James and its network of advisors may find their sales of mutual funds and other investments rising substantially. And if it works, mutual fund companies might take note of how a little charity can take sales a long way.

Garrison Asset Management of Chatham, Mass., one of Raymond James' financial advisors, began pledging a quarter of its fees to local charities in July 1997. At that time, after eight years of business, the firm had only $2 million of fee-based assets under management. But only two years after introducing its philanthropic program, Garrison Asset Management's fee-based assets under management increased 10 times to $20 million.

During this time, Garrison has donated $20,000 to local charities helping the homeless, the aged and others. These charities include the Cape and Islands United Way, the Harwich Ecumenical Council for the Homeless and the Cape Cod Hospital Cancer Unit.

Mike Garrison, president of Garrison Asset Management, said he came up with the idea of giving back to his community after his 17-year-old daughter committed suicide.

"United Way immediately put our family in touch with a grief counselor after Sierra's death," Garrison said. "They were immensely helpful to us during that tragic time and left us with a great sense of community."

"So we now make donations to a variety of charities, all in tribute to our daughter," Garrison said. While none of these charities are specifically related to teenage depression, he and his family think of these donations in their entirety "as a memorial to our daughter," Garrison said.

"Everybody, I'm sure, has a significant, touching story in their history that could give rise to some philanthropic cause," he said. "For many of our investors, this program has clearly struck a resonant chord. Believe it or not, being charitably conscious has been extremely important to some clients."

"It is ironic [that] during this time of unprecedented wealth generation, per-household donations to human service organizations have actually declined," Garrison said.

Garrison introduced the idea at Raymond James' conference for its financial advisors last March in Orlando, Fla. Afterwards, Garrison and Raymond James chairman Tony Greene were "swarmed by financial advisors who appeared very moved by the presentation," said Garrison.

Although Raymond James is not making any matching contributions in this program, the firm is spending money on promoting the concept to its financial advisors through a brochure and video, Curtis said. He declined to disclose the promotional budget.

Raymond James has also tried to set a philanthropic example for its business partners by making contributions to the arts and sporting events in the Tampa Bay area, Curtis said. This includes helping fund and buying the naming rights to a brand new football stadium - the Raymond James Stadium - for the Tampa Bay Buccaneers. The stadium was completed last September.