Best Practices & Case Studies

Sustainability Costing Tool

Publication date: 
June, 2016
Source(s): 
Indiana Philanthropy Alliance
Council of Michigan Foundations
Philanthropy Ohio

Indiana Philanthropy Alliance (IPA), Council of Michigan Foundations (CMF), and Philanthropy Ohio (POH) are pleased to provide you the Sustainability Costing Tool. It is our hope that community foundations will use this tool to generate data that will empower them to develop a path toward sustainability. The tool can be used by community foundations of any size to develop a better understanding of its revenue and expenses.

Over the past decade or so, the community foundation field has made great strides in understanding and managing the sustainability of its operations. In the 1990s community foundations began to struggle with covering operating costs. In 2003, FSG released the results of a rigorous analysis of revenue and expenses of community foundations. The findings were eye-opening for the entire field. What we all learned from the study is that we had been adding activities and services that were far more expensive to provide than anyone realized (for example, donor-advised funds, scholarships and community leadership) resulting in an unsustainable business model.

Over the subsequent years, many foundations replicated internally the data collection and analysis FSG pioneered with its original study using FSG’s Activity-Based Costing Toolkit. Unfortunately, the rigors and complexity of that analysis meant that only the larger community foundations could realistically afford to or have staff with sufficient expertise to use the toolkit.

In 2014, the Indiana Philanthropy Alliance, Council of Michigan Foundations, and Philanthropy Ohio began work on a simplified approach to conducting this analysis and are pleased to share our Sustainability Costing Tool with the field. It is our hope that this material will enable a community foundation of any size to develop a better understanding of its revenue and expenses.

 

Watch Video About the Sustainability Tool

IPA members may watch the video for free here.

Non-members may purchase the video here.