Effective governance of corporate foundations

The following report sums up the main findings of a study on corporate foundations. The research focus is put on different governance systems and their consequences for the independent status of the foundations' management as well as the foundations' ability to increase social impact. In the first section, we review three international standards that lay down good practices of corporate foundation governance. From these standards we extract the main variables that determine the foundation's ability to act. In the second section, the methodology chapter, we explain how we integrated the variables into the "multiple case study design" approach followed. In the final part, we present the results from a cross-case analysis, thereby discussing critical issues that we found to have implications on the ability of corporate foundations to achieve social impact. Our findings result in four different philanthropy models for corporate foundations. These can be described by determining a foundation's degree of independence and the closeness of its activities to the core business areas of the corporation. The report concludes that a high degree of independence allows corporate foundations to best play out the structural advantages of foundations in their organizational form. However in some core areas strong relations and support are desirable. Clear and transparent communication about the relation to the corporation besides expert knowledge on the board are factors found to positively influence the credibility of the foundation and its ability to act. A strong and positive reputation of the foundation, in turn, has positive effects on the public perception of the corporation.