Joanne Curry, CFA Vice President of Client Services, and Kayla Boye, CFA Operations & Business Manager, hosted a LinkedIn Live discussion about how nonprofit endowments can be leveraged to ensure long-term organizational sustainability. They explored common endowment misconceptions and related their personal experiences working with clients and establishing and managing endowments. As a follow up to that discussion, CFA has compiled six key takeaways and a Guide to Endowments:
Exploring Nonprofit Endowments:
- Involve board and legal expertise. While endowment terms may be written and approved by your board, an attorney should review policies before they are finalized. Once an endowment is established, it is important that your board creates an investment committee to actively track portfolio performance and make decisions about brokerage options.
- It takes time and resources to maintain an endowment. If a donor has made a major gift to establish a named endowed fund, your organization must regularly report progress to that donor to ensure continued stewardship. A bank, community foundation, or other partner can also help with endowment management and reporting, typically for a small fee.
- Legacy giving is a powerful motivator. Supporting an endowment is one of the most impactful acts of philanthropy; by naming an endowed fund, a donor can ensure their legacy while supporting the organization in perpetuity.
- Bundle your endowment effort with another campaign. You can enhance the appeal of an endowment by including it as a component in a capacity building campaign or adding it to a capital campaign to support ongoing maintenance and operations costs of a new building.
- There is no time like the present to establish your organization’s endowment. The sooner an endowment is established, the sooner investments can grow.
- Endowments can help your organization pursue a transformational vision. An endowment can provide additional annual income that can help free up your organization’s frontline fundraising staff to focus on developing new donor relationships, deepening existing ones, and preparing asks for transformational gifts.
If you missed CFA’s webinar on “Exploring Endowments,” click to view a recording:
Considering starting an endowment? Contact CFA today to help envision and implement your endowment fundraising strategy. For more articles related to philanthropy and fundraising, check out CFA’s Insights page.