February 2004

Foundation Governance: The CEO Viewpoint

In the fall of 2003, the Center for Effective Philanthropy conducted a survey of the CEOs of the 250 largest U.S. foundations to gather information about the governance practices of foundation boards. The center received 129 completed surveys for a response rate of 52 percent. This report describes our findings, identifying foundation responses to recent media and legislative scrutiny, as well as highlighting the key attributes of foundation boards that are perceived by CEOs as most effective.

All organizations are accountable for obeying the law and complying with the tax code. in this regard, foundation boards are no different from the governing bodies of other organizations. In many other ways, however, foundation boards face distinct challenges. unlike corporate boards that are accountable to shareholders or nonprofit boards accountable to donors, the foundation board is typically accountable to no outside entity in overseeing the substantive work of the foundation. The board's mandate may be defined by a trust document or the intent of the donor but, for all practical purposes, the determination of whether a foundation performs well and is effective in achieving its goals rests primarily with the board. Understanding the role and practices of foundation boards is, therefore, essential to any examination of foundation effectiveness.