Going Out of Business
There was a time when families establishing private foundations rarely thought about an end to the foundation. They assumed what they had created would last (as intended) in perpetuity from generation to generation. What they discovered as John D. Rockefeller observed years ago is “perpetuity is a very long time.”
I have been talking with families and executives this week about the growing number of private foundations deciding to “sunset” after a predetermined number of years. Of course, the primary reason is the concern about the mission and values of the foundation shifting away over time from the original intent of the donor. There are other reasons – like children not having an interest in the foundation or the assets dwindling – but these are secondary.
While the language used to describe this process includes “spending down” or “liquidating” or “closing the doors”, I would like to think of it another way. It’s not the way for everyone but this is what would work for me if I knew I was setting a date for the change. I would call it dissolution…but not in the way that term is normally used.
When salt dissolves it is absorbed and assimilated into the body. About 40% of the sodium is contained in our bones and the balance in our blood. It becomes an integral part of the body and long after we consume it the effects remain as the sodium and chloride do their important work. That is how I see the most important work of a foundation. If we do our work right, we will do more than invest in a community or make financial gifts to a community that evaporate when we are no longer there. Rather we dissolve and the things that are truly lasting – our values, our way of seeing opportunities, our relationships, our non-financial contributions – become a lasting part of the community in which we live. We do not “go out of business”. The best parts of us are absorbed and used for years to come in the blood and bones of where we have worked. We have a lasting contribution.