Whether you are considering establishing a private foundation or assessing your foundation’s current policies and procedures, the following checklist is intended to confirm your foundation is practicing good foundation governance and following industry best practices.The list is meant to serve as an overview of the structure for the business of a foundation in accordance with legal requirements and the basics of good governance. The list is not comprehensive, and clients should consult with their legal and tax advisors regarding their personal circumstances.
Whether you are considering establishing a private foundation or assessing your foundation’s current policies and procedures, the following checklist is intended to confirm your foundation is practicing good foundation governance and following industry best practices.The list is meant to serve as an overview of the structure for the business of a foundation in accordance with legal requirements and the basics of good governance. The list is not comprehensive, and clients should consult with their legal and tax advisors regarding their personal circumstances.
Governing Documents
- Declaration of Trust and/or Fund Agreements
- Articles of Incorporation and Bylaws
- IRS Determination Letter and the Form 1023 IRS Application for a Tax-Exempt Organization
- Establishment of the Foundation - Intended lifespan; guidance from the primary funder
- Mission Statement and Focus Area
- Board Member Roles and Responsibilities
- Foundation Meeting Procedures, Agenda, and Meeting Minutes - Maintain for record-keeping purposes
- Board Composition and Succession Criteria
Compliance and Key Policies
- Directors and Officers (D&O) Indemnification Insurance
- Conflict of Interest Policy - Decision makers should affirm annually
- Code of Conduct - Ground rules for behavior, communication and decision-making
- Confidentiality Policy - Clarify which information is shared with the public
- Employment and Contractual Agreements Policy
- Whistleblower Protection Policy
- Document Retention and Destruction Policy
- Social Media Policy - Create for the foundation, board and grantee organizations
- Gift Acceptance Policy (if applicable) - Review, accept, and substantiate contributions
Investments and Financial Policies and Practices
- Investment Policy Statement - Outline investment objectives, guidelines for investment managers
- Spending Policy - Includes understanding the annual required qualifying distributions
- Travel and Expense Policy - Includes reimbursement policy
- Compensation Policy - Board members (if applicable), staff, and outside advisors
- Audited Financial Statements
- Annual Operations Budget Development and Process
Grant Program and Policies
- Grant Policy - Identify types of grant funds (endowment, scholarship, capital, international, discretionary)
- Grant Guidelines and Programs - Identify conflict-of-interest situations, clarify provisions
- Grantmaking Process - Develop procedures for reviewing, approving, and working with grantees
- Grantee Communication and Engagement Guidelines - Determine frequency and content
Other Good Practices
- Familiarity with Federal Income Tax and State Tax Regulations - Most recent 990PF IRS tax filing and other tax requirements
- Employment and Property Taxes (if applicable)
- Annual Evaluation of Board Engagement
- Annual Assessment of Operations
