Foundations are a very specific type of nonprofit organization. What distinguishes foundations from many other types of nonprofits, especially in terms of governance, is the role of the founder. The founder’s intent is encapsulated in the foundation’s deed and is thus a guidance that cannot be changed easily. Additionally, grant-making foundations are unique as they do not need to raise money but rather provide financial resources to other organizations. This chapter offers a general overview on foundation governance, including legal and historical fundamentals, different types of foundations, and actors of foundation governance. This includes the recent call for more democratic procedures in foundation governance. Afterwards, major challenges of foundation governance are discussed. Asset allocation, succession planning and conflicts of interest are specific topics for which foundation boards are constantly seeking solutions. Recent methods such as self-assessment and grantee perception should improve the overall functioning of the foundation.
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