Family Foundations

The Council on Foundations defines a family foundation as one whose funds are derived from members of a single family, though this is not a legal term and has no precise definition. The Council on Foundations suggests that family foundations have at least one family member serving as an officer or board member of the foundation and, as the donor, that individual (or a relative) must play a significant role in governing and/or managing the foundation. Most family foundations are run by family members who serve as trustees or directors on a voluntary basis. In many cases, second- and third-generation descendants of the original donors manage the foundation.

Family foundations make up over half of all private (family, corporate, independent, and operating) foundations, or 40,456 out of approximately 73,764 foundations (Foundation Center, 2011). Family foundations make up approximately one-third of the Council’s membership.

Family foundations range in asset size from a few hundred thousand dollars to more than $1 billion. The holdings of family foundations total approximately $294 billion, or about 44 percent of all foundation holdings of $662 billion. Despite this, three out of five family foundations hold assets of less than $1 million. Family foundations gave away approximately $21.3 billion in grants in 2011 (The Foundation Center, 2011).

Below is everything on our site for family foundations. You can use the filtering options on the right to narrow these results.

As different as foundations can be from one another, they all share the need to know what works and, especially, what works well. The more foundations can show how their grants are making a difference, the more value they can bring to their communities.

To know what works, foundations must evaluate their grants. Evaluation has many benefits. It helps the foundation assess the quality or impact of funded programs, plan and implement new programs, make future grant decisions, and demonstrate accountability to the public trust.

Social media is an increasingly prevalent part of our world. Whether it’s on the news, sitting in traffic, or talking with colleagues, you’ll be hard-pressed to avoid mention of Facebook or Twitter. Is there a good way for your foundation to become involved?

Question: Our foundation has been funding a local nonprofit for the last ten years. The nonprofit has one full-time employee and an annual operating budget of about $300,000. The nonprofit recently requested a $50,000 grant for operating expenditures or it will have to close down immediately. Even if we make the grant, they may only operate for another month or so. If the foundation makes the grant but the nonprofit dissolves anyway and $20,000 of the grant remains unspent, what happens to that money? Can we fund them?

Note to the Program Officer

The scope of the program officer job description has evolved. Where it was once primarily tactical—reviewing funding requests and developing requests for proposals—the program officer’s role more commonly includes strategic activities. Program officers must master three distinct areas: (1) developing and strengthening internal networksand relationships, (2) creating the foundation/giving program’s grantmaking strategy,and (3) engaging grantees and the community.

One of the greatest challenges encountered in thinking about evaluation is that there usually is more than one acceptable way to evaluate a given grant, project, or program.

The form that an evaluation takes and the products that it yields will depend on choices made about the following issues:

Question: A potential grantee submitted to us an IRS letter of determination that expired on August 30, 2008. The grantee said that, despite the expiration date, the letter of determination is treated as the grantee's permanent ruling. Is this true?
 

What is the five percent payout requirement?

Each year, every private foundation must make eligible charitable expenditures that equal or exceed approximately five percent of the value of its endowment. The purpose behind the minimum payout requirement contained in Internal Revenue Code Section 4942 is to prevent foundations from simply receiving gifts, investing the assets, and never spending any funds on charitable purposes. The basic rule can be stated simply, but its calculation is complex.

Both the board and CEO advance each foundation’s mission. They hold different responsibilities, but they need to support and balance each other.

The Council on Foundations’ Foundation Management Series provides foundation boards and staff with the tools needed to benchmark their practices and operations against peers in the field. Containing data from the Council’s 2009 Foundation Management survey, the series consists of three reports: Board Composition and Compensation, Administrative and Investment Expenses, and Fiscal Oversight.

Board Composition and Compensation

Board Composition and Compensation offers findings on foundation policies regarding board compensation and diversity.

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