Community
foundations are booming around the world, as charities benefit
The Ottawa Citizen
July 2, 2005
Charles Enman
Page
E2
Posted with permission from The Ottawa Citizen
It
was a kind of philanthropic high summit: The heads of community
foundations from 13 North American and European countries, all
part of the Transatlantic Community Foundation Network, spent
five days -- in Ottawa in early May -- in discussions on how best
to promote a new form of philanthropy that is quietly sweeping
the world.
"Everywhere you go, community foundations seem to be the
best-kept secrets in town," says Barbara McInnes, president
and CEO of the Community Foundation of Ottawa. "The global
trend toward this new form of giving is unprecedented -- it's
moving into countries everywhere, in a wave that has delivered
great things and promises a lot more in the near future."
Community foundations build endowment funds to support causes
and issues in their community. Area leaders and residents manage
the donations and make sure money goes where the community's need
is greatest. The benefit for donors is that they don't have to
get involved with administration nor do their own research on
where the urgent needs are.
Canada is a leading participant in the movement; the 28 foundations
in 1992 have grown to more than 145 today. Last year, Canadian
community foundations gave $95 million to local charities.
In 17 years, the Community Foundation of Ottawa has developed
an endowment of $81 million, while giving away more than $28 million.
Average annual disbursements in recent years have been between
$4 million and $5 million.
Ottawa, in fact, is highly respected by other foundations. Dorothea
Jaeger, foundation head in Hannover, Germany, says, "The
Community Foundation of Ottawa has seemed like an example of 'best
practice' to many foundations here in Germany -- an exceptionally
convincing model of how to build endowments, manage donors, and
set governance policy."
Ms. McInnes acknowledges that her group reaped great benefits
from the run-up in technology stock values in 2000. That year,
many entrepreneurs were finally able to exercise their stock options,
and did, giving Ms. McInnes's organization so many stock certificates
that the endowment, over only five months, swelled from $17 million
to more than $54 million. Fortuitously, Ms. McInnes and her board
cashed the certificates before the bottom fell out of the technology
market.
Here in Silicon Valley North, technology entrepreneurs remain
important donors. Cistel Technology Inc., an IT consulting company,
has established the Cistel Fund, which, over three years, has
developed an endowment of $35,000 and aims for up to $500,000
over the next five years. The company's 100 employees and subcontractors
make voluntary donations to the fund, which has supported, in
company president Nishith Goel's words, "some of the smaller
charities that fall beneath the radar screen." A bonus is
that the community foundation takes care of all administrative
details, Mr. Goel says.
Technology entrepreneur Coralie Lalonde has founded the Katsura
Community Fund, her own private fund that supports causes she
designates. "What I like is that they're a neutral broker,
so I can trust their advice on what the needs out there are,"
she says. "If
I want to give to an animal cause, they can identify the projects
and tell me what their strengths are. For me, this makes things
efficient."
Still, Ms. Lalonde, like other technology entrepreneurs, likes
to have her hands on at least some levers, so she joined the foundation's
board a couple of years ago.
There are fascinating community foundation stories coming from
around the world, Ms. McInnes says. The story of California's
Silicon Valley is in some ways an inspiration for the Ottawa foundation's
approach to tech entrepreneurs. And the story of the Russian oligarchs
leading a surge of generosity testifies that charity can sprout
in the driest of earth.
© The Ottawa Citizen 2005
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