Share

Coutts report examines merits of short and long-term charitable foundations

Coutts report examines merits of short and long-term charitable foundations
News

Coutts report examines merits of short and long-term charitable foundations

Governance | Jonathan Last | 22 Mar 2012

Private bank Coutts has today published a guide that explores the debate around the longevity of charitable foundations and the impact they have, comparing foundations that exist indefinitely to those whose capital is distributed over a set period.

The guide Perpetuity or limited lifespan: How do charitable foundations decide their longevity? identifies the many issues surrounding the pros and cons of perpetuity and limited-life options, featuring case studies of foundations that have grappled with making decisions about how long-term social change can best be achieved.

The guide was launched at a Coutts Forum for Philanthropy held last night, hosted in association with The Diana Princess of Wales Memorial Fund, which together with the Joseph Rowntree Charitable Trust debated the merits of both alternatives.

Many foundations are established to exist in perpetuity, meaning that the capital investment is not spent, and only the interest earned on the investment is distributed to causes. Such charitable foundations provide ongoing financial support to their chosen causes, often for many generations.

Alternatively, ‘spend down’ trusts as they are commonly known, representing a relatively small part of the foundation landscape, will have a limited lifespan as the capital and its interest is distributed over a set period, such as the donor’s own lifetime.

Lenka Setkova, director of philanthropy services at Coutts commented that the debate has been heightened by recent high-profile legacy announcements by people such as Chuck Feeney, founder of The Atlantic Philanthropies, Sir David Sainsbury or Bill Gates who have pledged extensive giving either in their lifetime or during a specific time period.

“There are advantages and disadvantaged to both options," said Setkova. "Some of the advantages of limited lifespan foundations might include the ability to honour donor intent and preserve the founder’s vision. In some cases the causes that a philanthropist might focus on could really benefit from a significant donation.

“However, as illustrated by the work of the Joseph Rowntree Charitable Trust, positive social change often needs patience and persistence and some family foundations exist in perpetuity to create a lasting legacy for the family. Whatever the longevity of a charitable foundation, the key challenge is to ensure that all philanthropic resources are leveraged to maximum affect.”

Comments

[Cancel] | Reply to:

Close »

Community Standards

The civilsociety.co.uk community and comments board is intended as a platform for informed and civilised debate.

We hope to encourage a broad range of views, however, there are standards that we expect commentators to uphold. We reserve the right to delete or amend any comments that do not adhere to these standards.

We welcome:

  • Robust but respectful debate
  • Strongly held opinions
  • Intelligent relevant discussion
  • The sharing of relevant experiences
  • New participants

We will not publish:

  • Rude, threatening, offensive, obscene or abusive language, or links to such material
  • Links to commercial organisations or spam postings. The comments board is not an advertising platform
  • The posting of contact details for yourself or others
  • Comments intended for malicious purpose or mindless abuse
  • Comments purporting to be from another person or organisation under false pretences
  • Gratuitous criticism, commentary or self-promotion
  • Any material which breaches copyright or privacy laws, or could be considered libellous
  • The use of the comments board for the pursuit or extension of personal disputes

Be aware:

  • Views expressed on the comments board are left at users’ discretion and are in no way views held or supported by Civil Society Media
  • Comments left by others may not be accurate, do not rely on them as fact
  • You may be misunderstood - sarcasm and humour can easily be taken out of context, try to be clear

Please:

  • Enjoy the opportunity to express your opinion and respect the right of others to express theirs
  • Confine your remarks to issues rather than personalities

Together we can keep our community a polite, respectful and intelligent platform for discussion.

Free eNews

Amnesty charity reserves fell to 18 days' spend

23 Apr 2014

The charitable arm of Amnesty International UK had 18 days' worth of free reserves at the end of 2013,...

Northern Rock Foundation says closure 'inevitable'

22 Apr 2014

The Northern Rock Foundation will close after it failed to reach a funding agreement with Virgin Money,...

HMRC doubles scrutiny of charity gift aid claims following Cup Trust

22 Apr 2014

HM Revenue & Customs more than doubled the number of investigations into claims for gift aid in the...

ASA: “I wish I had breast cancer campaign” did not breach guidelines

23 Apr 2014

The Advertising Standards Agency has not upheld criticism over a series of controversial adverts by Pancreatic...

HMRC doubles scrutiny of charity gift aid claims following Cup Trust

22 Apr 2014

HM Revenue & Customs more than doubled the number of investigations into claims for gift aid in the...

Donations to foodbank appeal surge after critical Mail article

22 Apr 2014

The Trussell Trust’s Easter Appeal raised more than £50,000 in two days after a backlash on social...

'Technology can offer charities more than just online donations'

10 Apr 2014

Charities are focusing too much on using digital tools for fundraising instead of how technology can be...

Amnesty calls for 'full and frank disclosure' on alleged US surveillance

9 Apr 2014

Amnesty International has warned that alleged mass surveillance by the American intelligence agency NSA...

Virgin Money Giving launches app following year of growth

1 Apr 2014

Virgin Money Giving has launched an app for users after reporting that 30 per cent of traffic to its platform...

Join the discussion

Twitter
 
Training

Attending our one day courses is a highly effective way of ensuring new and existing trustees fully understand their role, responsibilities and liabilities.

>> Find out more <<