This document discusses trends, practices, and challenges in foundation governance, specifically in grantmaking organizations. It covers the importance of board roles, responsibilities, and composition, highlighting the need for effective governance through strategic planning and oversight. Additionally, it provides data on foundation giving and trends in U.S. philanthropy, emphasizing the need for diverse perspectives and ongoing board education.

1. FOUNDATIONGOVERNANCE
TRENDS,PRACTICES&
CHALLENGESIN
GRANTMAKINGGOVERNANCE
EmilyDavis|©EmilyDavisConsulting2019
BoardSourceSeniorGovernanceAssociate
February5,2019

2. A LittleAboutYou…
Name
Title/Role
Foundation
Location
Foundation
governance

3. ABOUT BOARDSOURCE
VISION a world where every social sector organization has the leadership it
needs to fulfill its mission and advance the public good
OUR GOALS
Deepen understanding and
inspire action on critical
sector issues
MISSION to inspire and support excellence in nonprofit governance and board and
staff leadership
Educate leaders and support
effective board service and
governance

4. WELCOME
Justin Wood
Governance Programs Manager
Emily Davis
Senior Governance Consultant

5. A LittleAbout Me…
MNM
Regis University
Consulting
Associate
BoardSource
Author
Fundraising
and the Next
Generation
Certified
Charitable Advisor
21/64
Founder
YNPN San Diego,
Global Shapers
Boulder Hub
Executive
Director
National
Hemophilia
Foundation
Colorado
Board Member
Social Venture
Partners,
Association
of Fundraising
Professionals,
YNPN
Facilitator
Certified in
Essential
Facilitation™ &
ToP Facilitation™

6. Foundations:
Introduction&Data
Whatarethey?
Whydotheymatter?
Whatarethechallenges?

7. FoundationTypes
Community
Including DAFs
“Public”
Independent
Family, Corporate
“Private”
Operating
Program & Grantmaking

8. Participant Poll
Is your foundation a:
q Community foundation?
q Donor-advised fund?
q Corporate foundation (private)?
q Family foundation (private)?
q Operating?
q Other?

9. A little data to get us
started…
Foundations:
• 16% of all giving in U.S. in 2017
• Increase of 6% from 2016
• Approximately 64% of all private
foundations are family foundations
• Giving to foundations was 11% of
total giving
Giving USA, 2018

10. A little data to get us
started…
Corporations:
• 5% of total U.S. philanthropy in 2017
• Increase overall of 5.7% from 2017
• Increase of 4.5% corporate
foundation grant making from 2016
Giving USA, 2018

11. LeadingWith Intent 2017
• 111 foundation boards
• Board performance & impact
• Board composition & diversity
• Intentional board leadership

12. LeadingWith Intent 2017
• Overall ”B” rating from CEOs &
Board Chairs
• Understanding board roles &
responsibilities leads to positive
impact
• Areas for improvement

13. LeadingWith Intent 2017
• Overall ”B” rating from CEOs &
Board Chairs
• Understanding board roles &
responsibilities leads to positive
impact
• Areas for improvement

14. • Adopting and following a
strategic plan
• Thinking strategically as a
board
• Monitoring grant-making
and grantees
• Advocating, public policy
Expectations

15. LeadingWith Intent 2017
• Overall ”B” rating from CEOs &
Board Chairs
• Understanding board roles &
responsibilities leads to positive
impact
• Areas for improvement

16. • Outreach &
ambassadorship
• Strategic planning
• Commitment &
engagement
Areas for Improvement

17. FoundationBoardRoles
andResponsibilities
“Excellentboardsaremade,notborn.”
–CommonfundInstitute

18. Board Roles & Responsibilities
SET
Organizational Direction
PROVIDE
Oversight
ENSURE
Necessary Resources

19. Board Roles & Responsibilities
SET
Organizational Direction
PROVIDE
Oversight
ENSURE
Necessary Resources

20. Long-Term Planning
Mission & purpose
Organizational strategy
Grantmaking strategy
Succession planning
Sunsetting?

21. How FunctionalAreWe?
Dramatic
Disengagement
Conflict
DYSFUNCTIONAL
Of no real
consequence
Compliant Anticipates plans
Sees opportunities
FUNCTIONAL RESPONSIBLE EXCEPTIONAL
Unconscious
Conscious
Enlightened

22. Board Roles & Responsibilities
SET
Organizational Direction
PROVIDE
Oversight
ENSURE
Necessary Resources

23. Tax Reform Act of 1969
Self-Dealing
Compensation
Grantmaking
LegalConsiderations

24. Measuring Impact

25. AskThe RightQuestions
WHAT
What is our
capacity?
What does success
look like?
HOW
How does this serve
our mission?
How does it fit our
strategic goals?
WHY
Why is this important
right now?
Why should we
consider other options?

26. Board Roles & Responsibilities
SET
Organizational Direction
PROVIDE
Oversight
ENSURE
Necessary Resources

27. Human & Financial
Resources
Legal Duties of Care, Loyalty, and
Obedience
Advocacy
Communications
Partnership
Board engagement
Service & leadership
Staff and board oversight

28. COMMUNITY
• Fundraising
• Donor-advised funds (DAFs)
• Portfolios are more liquid
• More people on their investment
committees (7.4)
• Go beyond board for expertise
PRIVATE
• Higher returns generally required
• Portfolios are less liquid
• Generally have smaller investment
committees (5.4)
Investment Practices
Council on Foundations

29. BoardComposition
Community: More “outsiders”
Corporate: Executives & senior
management
Family: bylaws dictate percentage

30. Family Foundation Board
Composition
Five generations in philanthropy
Family only: set maximum age?
Family + spouses
“Children”
Youth members: set minimum age, beware
“youth boards”
Board service length
Responsibilities & accountability
Non-family members: equal voting?
Council on Foundations

31. Tradition
Family Unification
Trust & Loyalty
Family-OnlyTrustees
Council on Foundations

32. New Perspectives
Age
Community Lens
Non-FamilyTrustees
Council on Foundations

33. All boards need education
Value of diverse
perspectives
No “kids table”
Succession planning
Philanthropy across
generations
AWord on “Junior Boards”

34. Compensated Board
Expertise and skills
Diversity – attract people from
different places
Attentiveness
Expectations and professionalism
Loyalty
Council on Foundations

35. Voluntary Board
Stewardship
Public trust
Mission commitment
Model governance
Conflict of interest
Council on Foundations

36. • Advocacy and lobbying
• Open up discussion
• Understand the value 7
impact
• Incorporate into culture
• Look for partnerships
• Take the leap and get
started!
Stand forYour Mission

37. Resources
Council on Foundations
National Center for Family Philanthropy
Exponent Philanthropy
21/64
Giving USA
Lilly School of Philanthropy, Indiana
University
Stand forYour Mission (BoardSource)
Leading with Intent (BoardSource)

38. Emily Davis, MNM
President, Emily Davis Consulting
Senior Governance Consultant,
BoardSource
emily@emilydavisconsulting.com
(303) 652-7536
emilydavisconsulting.com
Boardsource.org