What Drives Foundation Expenses & Compensation? Results of a Three-Year Study—Highlights

by Elizabeth T. Boris; Rachel Elias; Mark A. Hager; Loren Renz; Mahesh Somashekhar

Feb 1, 2008
This brief presents key findings from the latest report of the Foundation Expenses and Compensation Project—the first large-scale, longterm, systematic study of independent, corporate, and community foundations' expense and compensation patterns and the factors behind them. Documenting the varying characteristics of the 10,000 largest U.S. grantmaking foundations, the study finds these differences—including foundation type, size, and operating activities—essential for understanding foundation finances. Not surprisingly, hiring staff and taking on staff-intensive activities raise charitable administrative expenditures relative to charitable distributions, while relying on unpaid board and family members and engaging in less-staff-intensive activities lower them. Most foundation operations, however, are somewhere between these poles.
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