Armanino Blog

Armanino Foundation Turns 1: What We"ve Learned

November 16, 2017

There's nothing like real-world experience to drive home what works and what doesn't. When we created the Armanino Foundation in fall of 2016, we gained a firsthand perspective on the challenges and rewards of establishing and managing a nonprofit organization. To assist others who have a private foundation (or who are considering starting one), we'd like to share some of the lessons we've learned in our first year.

Empowered Giving Builds Enthusiasm

The most dramatic revelation was how incredibly rewarding it has been for our people, as well as the organizations we support. For nearly a decade, Armanino employees have devoted a day to community service through the firm's Great Give program, and this annual event has been one of our best morale boosters. The Armanino Foundation builds on that wonderful history of giving back to our local communities, increasing our ability to contribute in personally meaningful ways and bringing deep fulfillment to everyone who participates.

Another—and related—lesson was the significance of how we structure donations and make grants. Armanino team members nominate grant-receiving organizations within four broad areas of interest (education, health and social services, animal welfare and the arts), and the firm's partners match staff contributions two-to-one. Donors can choose how to allocate their gifts, which gives a real sense of ownership and personal connection to the Armanino Foundation's work. When staff or partners nominate organizations that serve colleagues and friends, it's easy to see how our efforts benefit people and issues we care about.

That tangible connection, coupled with strong communication, has led to an exceptional 25% participation rate in the foundation's initial year of operation, as well as high enthusiasm among partners and staff. "We've found that sharing the results of the grants we pay and responses we receive from the grantees has been meaningful for donors and encourages the rest of the staff and partners to get involved," says Katy Brown, senior tax manager at Armanino and a member of the foundation's Grants Committee.

Organization Enables Smooth Operations

The amazing generosity we have witnessed is great news for recipients but can pose a challenge for foundation administrators, as we learned after Hurricane Harvey devastated Texas, and the Armanino Foundation decided to fundraise for organizations that were assisting victims. "We didn't plan on handling disaster relief, but we felt the need to do something when that once-in-a-lifetime hurricane happened," says Mary Tressel, chair of the Armanino Foundation board and marketing director for the firm's Consulting practice. "The support was amazing; we got 98 new donors in a month, and my desk was covered with checks." To better handle that kind of overwhelming generosity, the foundation plans to implement a donor management system in 2018.

Regulatory compliance is another area that demanded careful attention. We found that our original intent of running all charitable giving activities through the foundation was impractical, since private foundations operate under more restrictive rules than public charities in regard to types of allowable grants, acceptable expenses and interactions with foundation leaders. As a result, we determined that some charitable activities had to be undertaken by the firm, and others by the foundation.

Think Outside the Grant Application Box

The foundation also provides avenues for giving back that don't involve grants. Staff and partners can use PTO (paid time off) days for "Volunteer Vacations" to participate in community service projects, with firm support for travel expenses. The first such trip was to Catalina Island, where participants helped the Catalina Island Conservancy perform beach cleanup and invasive plant eradication. In early November, a 13-member volunteer team headed to Dallas to work with F.A.R.M. (Farmers Assisting Returning Military), preparing their downtown site for a big Veteran's Day celebration and putting financial expertise into the hands of veterans who need it. Like nominating grant recipients, taking these trips allows team members to play an active role in supporting the causes that matter to them.

"Armanino's people have always demonstrated a strong desire to do good in the world," says managing partner Andy Armanino. "The Armanino Foundation lets us channel that urge to contribute in different ways. Whether it's donating for a special cause we care deeply about or hands-on work during a Volunteer Vacation, we know we can do something that makes a real difference. It helps us turn our commitment into concrete action, and that feels great."

One year in, the entire firm is proud of the Armanino Foundation's accomplishments and excited about its potential for creating positive change. "It's rewarding to work for a company that is willing to put this much into giving back to the community," says Brown.

"Buy-in and excitement at the firm is humbling, and the feedback from the nonprofits who have received grants has been very gratifying," adds Tressel. "It provides a way for us to make such a positive impact in our communities."

Contact Armanino's nonprofit accounting team to learn more about what you need to consider before setting up your own private foundation.

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