Oli French & Sally Vivyan: Why and how do foundations spend down?

Send us Fan MailIn this episode we talk to Oli French (freelance consultant) and Sally Vivyan (Co-Director of Gower Street and Grants Advisor/Trustee to the Sir Ernest Cassel Education Trust) about why and how foundations choose to spend themselves down. Including:Are decisions to spend down more commonly about mission, principles or practicalities? Or is it a mixture of all 3 (and how does the balance shift over time)?Who tends to make the decision to spend down in an existing perpetual foundation? How do they justify their legitimacy to make this decision?How often do people make appeals to the original founder’s wishes or values?How many foundations openly share their rationale for spending down? Is this primarily to justify their own decision, or to influence others?How important is it to situate a decision to spend down in knowledge of the wider funding ecosystem?What are the different methods for spending down?Do most foundations increase spending across all existing grantees, focus in on a particular subset of them, or look to fund new things?How are debates about spending down related to debates about the need for higher average foundation payout rates (or mandatory minimums)? How are payout debates related to debates about foundations investing their assets in line with their missions?To what extent do foundations exist in perpetuity as a default, rather than an active choice?Would it be enough to shift this norm? (i.e. allow for foundations to be perpetual, but make that more of an opt-in/active choice than it is currently?)Is there a risk that discussions of spending down with the philanthropy world become too polarised and polemic (i.e. spending down is the only “right” way, and all others are “wrong”)? Is the current focus on spending down merely the latest iteration of a long-standing critical debate about perpetuity, or is there something fundamentally new or different about what we are seeing right now?What is driving this focus on spending down? Is it primarily supply-side concerns about philanthropic power, or demand side concerns about the scale and urgency of need right now?How do charities view the spend down debate?  How different is the decision to make a newly-created foundation limited-life from the decision to shift an existing perpetual foundation to a spend down approach?Is there any evidence (anecdotal or otherwise) that next generation philanthropists take a different view of perpetuity than previous generations?Are there ever valid arguments in favour of perpetuity?FURTHER RESOURCES:The microsite presenting the findings of the spend down groupACF Funders Collaborative Hub page for the spend down group WPM short guide on long-term vs short-term in philanthropyWPM long read "What is the Point of Foundations?"Philanthropisms podcast episodes on the history of foundations and on The Gates Foundation and Timescales in Philanthropy