The paper – entitled Preserving Donor Intent: Control Versus Continuity – outlines why some donors structure their foundation to ensure their values are preserved and how this is typically done. But it acknowledges there are “trade-offs” in doing so, while highlighting that the key challenge for most is about striking the right balance.

Most foundations, writes John Oddy, senior philanthropic director, are constructed in perpetuity but established with a general purpose mandate: “to advance religious, charitable, scientific and educational purposes.” This gives the donor and their successors the flexibility to change the foundation’s mission over time to reflect changing conditions. However, giving generations further down this line this much “leeway” may prove unnerving among those who fear that the foundation's original purpose may get diluted.

Although non-binding strategies may “lack teeth,” this is not necessarily a drawback “if the spirit of their original intent is more important than a literal interpretation,” the paper says. Founders who opt for this route often have conversations centered on the vision of the foundation, or they may document their intent. Some founders appoint a surrogate to enforce their intent, mandating external audits of grant-making, etc. They can even confer legal standing to a third party that could sue the foundation if it deviates from the founder’s instructions.

On that note, the paper says that, when enacting restrictions, an important consideration is whether the foundation has been established as a trust or corporation - because there are significant distinctions between the two and laws vary by state.

A trust structure ultimately offers the highest level of control . If set up as a corporation, on the other hand, articles of incorporation may be written to limit its charitable purpose to a specific area, for example. Such legal “protections” can, however - in some instances - result in a reduction of control away from individuals involved and into the hands of the court.

“Founders who seek to control from the grave should be forewarned that too many restrictions can have unforeseen consequences,” the paper says. If restrictions are too rigid, resulting conflicts could land the foundation in court. While some “take comfort” in this, courts are “unpredictable as interpreters of donor intent.”

Foundation Source gives the following advice to founders looking to impose controls: take your time; emphasize goals, not prohibitions; look beyond legal advice; and weigh control versus family engagement. While a lack of control may cause a foundation's activities to stray from its core values, too many restrictions may hamper the ultimate success of it.