In the March issue of Alliance, Anthony Tomei takes a dim view of foundation accountability. He argues that accountability is an operational matter: the trustees should decide whether or not it is a good idea for their foundation to be accountable beyond the legal requirements. In his opinion a foundation that strives for long-term change in society has a greater responsibility to be accountable than one that just gives grants to any registered charity.
In the strict legal sense, Mr Tomei is right: it is up to the trustees to decide the degree to which a foundation should be accountable. But the real discussion is a completely different one, namely, should trustees be more open to transparency and accountability?
In my view foundations are powerful and influential actors in society and, as such, they should be accountable to society for their actions. Companies have their shareholders and workers’ councils; governments have their democratically chosen parliaments; and foundations have … their endowment and their trustees. And that is not enough!
If an endowed foundation wants to be influential in society it cannot just comply with the formal rules on accountability. It must make clear why it takes the actions it does. If the foundation makes a clear stand on controversial issues but does not make clear why it takes that stand, other actors will doubt its legitimacy. The foundation cannot be an effective player in society if its principles are invisible, its statutes and programmes are secret, and it fails to answer serious questions in public.
I agree with Mr Tomei that not all foundations have to be accountable and transparent to the same level. A foundation that does nothing but make each charity in its territory an equal grant will not be asked a lot of questions. I have never seen such a foundation, but it is a theoretical possibility – and it might reasonably be asked to explain why it does not spend its money more effectively. Most foundations have clear policies and try to achieve change in society, albeit small. They should be eager to explain why they pursue the policies that they do. It will help them to be more effective.
The EFC Principles of Good Practice show the way to foundations to be more transparent and accountable. I hope they will meet wide support at the EFC’s Annual General Assembly in Sarajevo. Of course I will send a copy to Mr Tomei as soon as they are accepted.
Boudewijn de Blij
Executive director, Fonds 1818, and chair of the Principles of Good Practice Task Force