[Foundation-l] Board letter about fundraising and chapters

[MZMcBride]

phoebe ayers wrote:
> The Board of Trustees has recently reviewed our fundraising model and issues
> related to the way donor funds are received. This review followed detailed
> discussions among the Board's Audit Committee and with our outside auditors,
> which highlighted issues about the level of financial controls over donor
> funds that go directly to the chapters who act as payment processors. This
> review focused on the model established last year, under which donors in
> certain countries are exclusively directed to the local chapter during the
> annual fundraiser. In our 2010-2011 year, about $4M net went directly to 12
> chapters, representing roughly 15% of the total funds donated to the
> movement.
> 
> There are several problems with this model, and with the current fundraising
> situation. Some chapters have received large sums of money early in their
> organizational lives, before they have built the capacity and financial
> controls to safeguard and best use those resources in pursuit of the
> mission. Some chapters have received many times their planned budget in a
> single fundraiser. Additionally, in some countries, transferring funds
> internationally has been limited by regulatory constraints.
> 
> There are also currently no movement-wide controls applied consistently to
> all entities that receive donor funds. Some chapters, despite being
> well-funded, have not reported in a timely way on their activities, their
> financial status, and their use of donor funds, or have had difficulties
> following the regulatory requirements of their countries.
> 
> This fundraising model has also contributed to significant resource
> disparity among chapters. Some of the largest fundraising chapters have
> revenue far greater than their stated need and capacity to spend, while
> other chapters receive revenue only from Foundation grants or have almost no
> revenue at all. The model also suggests that chapters are entitled to funds
> proportional to the wealth of their regions, which amplifies the gap between
> the Global North and South.

I think it's great that the Board is looking into this. I was vaguely aware
of the problem and it's certainly one that needs to be addressed.

I have two questions from your post:

* Is there a breakdown of the amount of money given to chapters from the
past fundraiser? A chart or something somewhere? There definitely should be
and I imagine there is, but I wouldn't be able to locate it off-hand.

* Have any chapters been asked to give money back? If so, what has been the
response?

MZMcBride