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Start Telling Before Anyone Asks


My friend Rick Cohen sent me a collection of his recent articles on the economic meltdown and what’s ahead for charities and foundations. Toward the bottom of his extensive list was a link to a sobering piece he did titled Lessons for Charities and Foundations from Bernie Madoff

In his lead, Cohen writes:

The press has been tallying the losses to investors, operating charities, and foundations, but there has been precious little analysis of what this means for the needed monitoring and oversight of how some foundations handle their–our–tax exempt dollars

Rick’s words sounded like a warning shot across the bow.

Seems to me that if you are responsible your foundation’s communications you better become ultra-familiar  — if not already — with your organization’s finances: your balance sheet; how the endowment is invested, including types of asset classes; the returns (and losses); as well as how your foundation selects, monitors, and evaluates its investment managers; the performance benchmarks it uses, etc.

If you don’t have a lot of experience in this area, start now.  Make your CFO your best friend.

In the past, when foundation assets were growing at a rapid pace, there was little interest, and no story. But these days, this soon could be an area of increased news media scrutiny.  To the degree you can, perhaps now is the time to start sharing some of this financial data, and more than you have in the past, and with a greater degree of explanation.  Make sure this information can be found easily on your website. That way, you won’t have to worry about someone firs asking you to tell. It already will be there.

If any of you have examples of how you make information about your financial activities more transparent, and beyond posting your financial statements and 990s, leave a comment and share relevant links.

–Bruce Trachtenberg

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