From Generation to Generation

Family foundations are often led by family members, generation after generation. But no one is born with the knowledge to run a foundation. In order to ensure smooth transitions, or at least minimize challenges, some critical points must be addressed in the very structure and practice of the family foundation.
Write your family foundation by-laws in a way that allows for variation in board size over time. Make the criteria for Board membership broad, allowing for the election of new family members, and non-family members, if desired. Decide at what age younger members should get involved. Some foundations involve family members in their teens and twenties. However, before assuming leadership, the younger generation must be taught about:

• Legal and financial aspects of the foundation,
• Researching grants,
• Decision-making,
• Evaluation,
• Relating to other funders, and
• Integrating foundation participation into their lives.

Some family foundations start off the younger generation by giving them a limited amount of grant dollars with which to make their own decisions. To acknowledge the changing leadership, some find it necessary to revisit the mission statement and grantmaking focus in light of the founder’s wishes, the passage of time and current family interests. Some family foundations find their grantmaking enriched by involving non-family members from the communities they serve.

One of the most appealing and challenging issues for family foundations is dealing with family relationships in the foundation setting. No fire wall separates everyday family issues from foundation meetings and decision-making processes. Siblings, spouses/partners, children and grandchildren all must work together. Some families use foundation meetings as a time for large family gatherings, and make decisions as a large group. Others pick a smaller number of family members to run the foundation, often rotating terms among eligible members.

Often the greatest leadership challenge comes with the passing of the baton from the founding generation to the next generation. The founder has set the tone and the focus, and has been the general powerhouse behind crafting a new organization. He or she may have invited some or all of their adult children to be Board members. Eventually the time comes when, due to death, illness, or choice, the leadership of the foundation moves to the next generation.

This transfer can be accomplished with planning and grace - or surprise and awkwardness - depending on the founder’s foresight. It is critical for founders to plan for their succession from the beginning. Talk about it with other family members. Be sure others are interested and ready to take on leadership roles. If no one in the family is interested in taking over the role of the founder, make plans for others to become involved. Use consultants if the issues get too hot or confused to reach consensus or clarity.

The beauty of a family foundation is that it can be a way to strengthen family connections, have fun together, teach values to new generations and maintain continuity, all while doing good for the community. Planning for intergenerational involvement helps ensure maximum outcomes for both the family and its grantmaking.