GEOList Summary: When Financial Woes Threaten to Constrain Program Priorities

This has obviously been a rough year in the financial world, and that kind of turbulence certainly has very tangible implications for foundations. I’d be interested in any insights you have – not so much on investments (for us and for most I would guess that’s in the hands of investment professionals) – but in terms of the following dilemma: many foundations operate off the gains from an invested endowment, and part of their charge is to preserve the corpus of the endowment. But when the gains off investments shrink, what’s available programmatically shrinks as well. But here’s the dilemma: as important as preserving the corpus of the endowment is, the mission of most foundations is about advancing the work in their chosen field. Nipping and tucking the budget in such circumstances is essential, but when the chopping begins to cut into the “bones” on the mission work, the cost is grave indeed. In the extreme, it could compromise the integrity of program work. But unless spending down the endowment is seen as a viable options, conserving that corpus remains a high priority. Have any of you wrestled with this type of dilemma? If so, what was communicated and how was it communicated to your Board? What strategies were most effective for being true to the mission work while at the same taking great care to preserve a funding base for an extended organizational future?