Ethics

Is there a role for non-trustee members of the family?

Posted on December 11, 2013 by Michael Rion

Responsible family philanthropy encompasses not only a sense of public accountability but also a sense of responsibility to other family members who may not be trustees. If the donor clearly intended for the foundation to encourage the extended family to be interested in philanthropy, current trustees should consider how best to communicate foundation policies and actions and to receive appropriate… Read More

How should we choose trustees when there is a vacancy?

Posted on December 11, 2013 by Michael Rion

Apart from some minimal requirements of state law (e.g., mental competency), there are no legal mandates about the process of choosing trustees. In some cases, especially in small foundations with very few family members, succession may be directed in the by-laws and/or by custom so that, for example, direct descendants are “in line” as the successor trustees.  When trustees have… Read More

Do we need formal policies on trustee selection, orientation, and evaluation?

Posted on December 11, 2013 by Michael Rion

Although there are no legal requirements, commitment to responsible trusteeship includes ensuring that such policies and procedures appropriate to the size and nature of the board are in place. For many foundations, this may mean nothing more than a mutual understanding between two spouses or siblings that review and evaluation of one another’s actions as trustees is appropriate when needed… Read More

How do we include successor generations on the board?

Posted on December 11, 2013 by Michael Rion

In some family foundations, there are eager and willing members of the second, third and even fourth generations who can serve as trustees. In these cases, responsible philanthropy and ethical treatment of family members means developing specific criteria for trustees and applying these criteria objectively in inviting new trustees. Criteria might include such factors as experience and maturity, diversity of… Read More

What is the appropriate role for non-family trustees and how are they selected? Should they be treated any differently from family trustees?

Posted on December 11, 2013 by Michael Rion

Non-family trustee positions should be clearly defined, regarding both criteria for filling the position and the length, renewability, etc., of terms. Although nothing prevents trustees from simply appointing their closest friends and advisors without regard to other criteria, ethical responsibility considerations would suggest some more objective criteria related to the mission and purpose of the foundation and the rationale for… Read More

Should we have non-family trustees?

Posted on December 11, 2013 by Michael Rion

There is no legal obligation to include non-family members as trustees. Experience in the field is widely varied. Many foundations include only family members who are blood relatives, and others include family members by marriage. Many others will have one “outside” trustee, typically an old family friend and/or someone with legal or accounting experience. Still others include as a matter… Read More

Ethics in family philanthropy: Right vs. right decision-making

Posted on November 10, 2011 by Rushworth Kidder

Ethical issues affect every facet of a family’s philanthropy from its structure and mission to its investment, grantmaking strategies, and perhaps most importantly, governance structure. The role of ethics and values is so integral to how families define and carryout their missions, and the expectations for ethical behavior among philanthropists so high that it’s easy to become overwhelmed or stymied… Read More

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