The First Year: Tips and Tools for the New Family Foundation CEO

Editor’s Note: This article is excerpted from The First Year: The Complete Guide for New Family Foundation CEOs and their Boards of Directors.

It is sometimes said that serving in the role of family foundation chief executive is an art, not a science. Family foundation CEOs have many roles to play and many constituencies to serve. But what distinguishes this job from those at other grantmaking organizations is the relationship between the CEO and the donor family. It’s a partnership that encompasses representing a family in a community, working within a family’s culture, and engaging in grantmaking in the context of a family legacy. The base on which an effective foundation is built is the trust between the staff and the family. Building that trust is your most important task.

This holds true even if you are a new CEO who is also a family member. While you already have a personal relationship with your family that is presumably grounded on trust, you still have to create a climate in which the board members believe in your ability to run the organization and have the judgment to advise them on foundation governance, management, and grantmaking.

If all this is new to you, you aren’t alone. Most new CEOs have never run a family foundation, and many have not been the CEO of any organization. Those who have already held the top job at a family foundation are seldom inclined to switch to a new family, because if they do, they will have to start again from scratch on relationship building, not only with the board but with the broader family, other staff if any, grantees, and the community.

In this month’s issue of Family Giving News, we share advice and tips for new CEOs from family foundation CEOs across the country.

It’s your first day. Where do you start?

The answer to this depends on what you’ve walked into. If the foundation has a large staff that can keep the work going while you get oriented, you’ll have more time to focus on getting to know people and learning about the organization. If you are the foundation’s first staff person and you have to set up an office, hire an assistant, buy computers and put a grant process in place, you’ll have more immediate issues to deal with than in a typical orientation period. And you’ll need to work more closely with your board to develop an action plan and make decisions.

If you are new to family foundations, you need to get up to speed on legal, financial, and investment matters, but many foundations contract with investment advisors and lawyers (some of whom may be family members) to manage those functions day to day, so at this point you may only need to find out who is doing what.

The best advice for people going into an existing operation is: don’t feel you have to start making changes immediately. “Too many people think they need to make big changes in the first 90 days,” says Virginia Esposito, president of the National Center for Family Philanthropy. At this point, listening may be the most important thing you can do.” As one CEO put it: “Be a sponge.”

“Take it slow,” adds Frank Wideman, president of the Self Family Foundation in Greenwood, South Carolina. “Avoid pushing agendas in the first six to 12 months. Don’t try to fix the family or fix community problems. Your main job is to listen and build trust.

Your Top Priority: Getting to Know the Family

You probably already know the foundation’s board members to some degree. At a minimum, you spent time with them in interviews during the search process. You may have been hired because they already knew you from another organization. Regardless, you now need to go much deeper and ask different questions. In a family enterprise, leadership is shared between staff and board, and you need to know where they are coming from, not only as a group but individually. That goes double if you are working with a living donor. The board chair can suggest who should be interviewed and in what order.

“You can’t make a single move on program until you’ve done that,” says Alice Buhl, senior consultant to Lansberg, Gersick and Associates and National Center Senior Fellow. “These interviews will give you unbelievable insight.” She stressed the interviews should be in person, not over the phone, and she advised meeting with them in their homes or place of business. “You get a whole different flavor about what their life is like,” she said, by seeing them on their own turf. “It also sets a tone that they don’t always have to come to you at your office.” This sometimes involves traveling to board members who don’t live in the same city as the foundation, but you may be able to combine your trips with visits to projects the foundation funds in cities where their members live.

Get to Know the Foundation’s Staff

Small foundations may only have an administrative assistant to help the CEO. Large ones have whole departments of program officers and others. Regardless of the number, it’s critical that you are sensitive to the staff’s views and concerns. They are probably nervous about dealing with a new boss and worrying about whether their jobs are at risk. “Find out what they contribute to the organization and what they need to make their work successful,” says Esposito. “You’ll also need to set performance plans and a set of shared expectations. This is important if a staff member you inherited isn’t performing up to par or is so identified with the previous CEO, that they have difficulty working for a new one.” You’ll need the objective performance measures “in case you have to make a change.”

Go On a ‘Listening Tour’

After you’ve spent time getting to know the board and staff, your next step is to talk to leaders both in the places where you fund and in your foundation’s focus areas. In selecting who to meet with, don’t focus on grantees so much as on “people who know the foundation’s work,” said Buhl. The board chair can help you identify those key leaders. “Ask about how the foundation is perceived. Ask, too, about the key issues that are emerging in the areas you are working in.”

During his first year as CEO of the Surdna Foundation, Phil Henderson asked one key staff member to give him a list of the top 50 people he should meet with in the philanthropy community including peers at other foundations and grantees. He went to their places of business. He also got involved in an informal group of a dozen top program officers, mostly vice presidents but also a couple of CEOs, who meet every six months.

First Board Meetings

Board meetings can be valuable times to learn more about the board members and their hopes and aspirations. The tendency, however, is to fill the agendas with grant decisions and other foundation business.

One CEO said, “It took me a couple of meetings to carve out unstructured times in board meetings to get to know what they cared about. I should have had the board talk about their history. Is there a shared narrative? They thought they had covered that in the interviews, but it would have helped me tremendously if for the first year the board had carved out an hour at every meeting where we talked about the values, the history, and the family.”

When it comes to board meetings, patience is a virtue, especially when you are new. “I had to learn to be more patient with the board,” said one CEO. You can’t push for closure when they aren’t ready for it. Instead of advocating, now I facilitate more.”

Clarifying Your Role—Never Say “My foundation”

When joining a family foundation, you need to check your ego at the door. “I have watched executive directors flame out,” says Bruce Maza, long-time CEO of the C. E. & S. Foundation, “and I think their mistake was in placing their own ideas, passions, and needs before those of the family. Eventually, someone in the family will ask ‘why does he get his way?’ The risk is a competition of egos. An even worse result is that the family foundation could become staff driven, thereby robbing the family trustees of their stake in the foundation’s grant programs, goals and achievements, and they will lose interest.”

Dealing With Family Dynamics

Just like in your own family, your foundation family comes with its own dynamics—both bad and good. This can be especially challenging for a new CEO. Sibling and parental relationships can shift. The way the family deals with one another is affected by birth order, personality, remarriages, and other factors. “It is very important to understand the role every individual within the family is playing, or may wish to play, in the work of the foundation,” says Sanford R. (Sandy) Cardin, president of the Charles and Lynn Schusterman Family Foundation of Tulsa, Oklahoma. “For example, I once heard a story about a new CEO who suggested that her foundation engage an outside consultant to advise its investment committee without realizing that someone in the family had been serving for years as an informal CIO (chief investment officer), a recommendation that caused totally unnecessary strife even though she believed it was exactly the kind of ‘best practice’ advice for which she had been brought on board.”

Maintaining Boundaries: You Are Not Part of the Family

While sometimes the close working relationship that develops between the board members and their CEO can make it feel like you are part of the family, it’s important to keep clear boundaries between your personal and professional roles. As one CEO interviewed for the National Center’s CEO Initiative puts it: “my work is to facilitate the best philanthropic goals of this family. I never advocate for funding a personal project. I recuse myself from the discussion if there is anything that might be considered a cause of mine.”

Views from the Field: Leah Gary, William J. and Dorothy K. O’Neill Foundation

When Leah Gary, President and CEO of the William J. and Dorothy K. O’Neill Foundation in Cleveland, was hired six years ago, her predecessor was the founder, William J. O’Neill Jr. She had not worked with a family before, but she did have strong foundation experience, having been the vice president at a Cleveland health care conversion foundation. “I knew the health field and I knew Cleveland.” But to get up to speed on the O’Neill Foundation’s funding areas, “I had to catch up on education issues and I had to learn the arts.” She also lacked knowledge of the other cities where they funded—those where family members live—so she traveled to those locations to meet with the board members in six cities, from New York to the Big Island of Hawaii. One of the board members who is an active arts funder brought her up to speed on that funding area.

With a good grounding in the family’s funding interests, she tackled their entire grantmaking processes. “They weren’t doing site visits, there was no staff analysis of the grants, only a synopsis, and they weren’t doing follow-up. The board members liked the changes. They loved having someone do the reconnaissance for them and recommend whether they should make a grant.”

Of her leadership role, Gary says, “I often follow and lead at the same time.” She is one of the rare family foundation CEOs who also holds a board seat. This is something she negotiated when she joined the foundation. “In that way, it is my foundation, too. But I know this is a family enterprise, and my last name isn’t O’Neill. If what they want to do isn’t illegal or immoral, then that’s okay, even if it’s not my vision. I have lots of ways to contribute on my own.” Of the new strategic plan the family is working on, Gary says, “It’s being led by them. They are driving it. I sometimes say ‘Think about this.’ But they are writing it themselves.”

Conclusion: A Well Traveled Path

This edition of Family Giving News shares just a small portion of the seasoned advice and tips included in The First Year: The Complete Guide for the New Family Foundation CEO, produced by NCFP. The complicated path to success for a first year family foundation CEO is one that has been traveled many times before, and the field of family philanthropy is full of generous people who are more than willing to share their time and experience with their peers. Whether you are a new CEO yourself, or are a board member or advisor to a family foundation thinking about hiring a new CEO, The First Year is right for you!