Private Foundations

Private foundations make grants based on charitable endowments. The endowment funds come from one or a small handful of sources -- an individual, a family or a corporation. Because of their endowments, they are focused primarily on grantmaking and generally do not raise funds or seek public financial support the way public charities (like community foundations) must.

“Private foundation” is the umbrella term that includes corporate, independent, family, and operating foundations.  As of 2011, there were 73,764 private foundations in the United States (Foundation Center, 2011).  

In 2011, private foundations held more than $604 billion in assets and gave away more than $45 billion (Foundation Center, 2011).  

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

This toolkit is designed for private foundations that want to educate and encourage their grantees about getting involved in civic and policy activities to increase organizational capacity and impact. While its primary focus is on the grantmaking activity of foundations, the toolkit also addresses rules and guidance for policy involvement by foundation officials acting on behalf of their foundations.

Sabbaticals are not too uncommon in the nonprofit world for foundation executives or senior management. It can be a useful time to reflect on past accomplishments, revitalize, and gain renewed inspiration for future work. Sabbaticals for board members likewise can have similar positive effects but should be approached with care.

When to Think Twice

Sample conflict of interest policies for staff and board members.

Sample conflict of interest policies from the Community Foundation of Switzerland County and Triangle Community Foundation.

Ordinarily, established private foundations and public charity grantmakers would ignore the IRS's revision of Form 1023, Application for Recognition of Exemption from Federal Income Tax. After all, these groups have already received their determination letters. But the revised Form 1023 and the accompanying instructions that the IRS issued on November 1, 2004, merit grantmakers' attention.

This article focuses on conflicts of interest around foundation investments. May foundation board members (or other closely affiliated individuals or businesses) manage foundation investments? May they be paid for this service? What factors should foundation managers consider before they select an investment manager who has a close relationship with the foundation? When is it a bad idea? What special procedures should be followed when a board member or other close affiliate is also an investment manager.

This article explores one of the more common questions about conflicts of interest: May the foundation's lawyer serve as a trustee?

Foundation Lawyer/Trustee

With Congress and the media focusing on corporate governance and foundation administration, it is a good time to make sure that all grantmakers have a strong conflict of interest policy in place. Both private foundations and public charities (such as community foundations) should have clear guidelines on financial or other interests that must be disclosed and transactions that must be scrutinized or avoided. The policy should cover both board members and foundation staff.

Directors & Officers liability insurance provides financial protection for a foundation and its directors, officers, employees, and volunteers in the event of a lawsuit.

For boards of directors, trustees and foundation managers, there are few areas of operation that cause more confusion and uncertainty than indemnification and the purchase of directors and officers (D&O) liability insurance. And it is no wonder. Mixing the often impenetrable statutory language of the Internal Revenue Code with the highly refined wording of insurance policies creates fertile ground for confusion. To make matters worse, the rules are not static. State laws change, Treasury regulations are revised and insurance policy language is frequently amended.

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