Move unifies Foundation Western, university endowment assets

By Jason Winders
May 22, 2014

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Foundation Western and Western University, arm’s length partners for 35 years, have officially unified, creating a new unit, Donor Funds Management, under the university’s External Relations department. The move was finalized April 30.

“We’re ecstatic about this,” said Chirag Shah, BSc’89, chair of Western’s Board of Governors. “From its inception, Foundation Western has been driven by engaged alumni. There is a recognition of that history, the importance of that history to Western, as well as a recognition of what we can do going forward.

“Western has come a long way in its fundraising and governance of those funds. This move not only recognizes what Foundation Western has done, but also what a wonderful opportunity we have going forward to leverage that.”

More than two-and-a-half years in the making, involving consultation with alumni and donors, Foundation Western’s $200 million in endowments have officially integrated with those of Western. Unifying endowment assets, policies and practices under the care of the university’s Board of Governors will reduce costs and increase investment opportunities, said Frank Pyka, Donor Funds Management executive director, and former Foundation Western executive director.

On May 1, Pyka and his team joined the Department of Alumni Relations and Development (External Relations). Foundation Western continues its reporting relationship to its board, but will remain intact with a dotted line to the Alumni Relations and Development associate vice-president.

Donor Funds Management will oversee the financial management and reporting of all donor-related funds contributed to Western.

“We are delighted to have the staff at Foundation Western joining our team,” said Kelly Cole, vice-president (external). “Frank is a strong leader and a great person to work with. He, and his team, bring a lot of best practices to our operations and will have a real positive impact.”

And if they do their jobs properly, Pyka said, donors won’t even notice a difference.

All named endowment funds will remain intact, including name, terms and conditions. Simply put, Pyka said, instead of the foundation’s board being responsible for the governance of the endowment, Western’s board will be.

“For donors, not much really changes,” he said. “In fact, some of the same people who were looking after the funds before will still be looking after the funds.

Established in 1979, Foundation Western was as a joint venture between the Alumni Association and Board of Governors. At that time, university endowed funds stood at about $10 million and annual alumni support for the university amounted to less than $100,000.

“Not much by way of fundraising was going on at the university at that time,” Pyka said of a condition indicative of an era when 85 per cent of university operations were fueled by provincial funds. (Today, only 41 per cent of Western’s funds come from the province.)

At its founding, the foundation’s primary purpose was to raise funds for the university and to build a “culture of giving among Western alumni,” Pyka continued.

Over the next three-and-a-half decades, the foundation’s assets grew to more than $200 million. During that time, more than 75,000 donors contributed to approximately 1,120 endowment funds. In total, the foundation has granted more than $90 million to support student aid, program enrichment and learning tools at Western.

By the mid-1990s, however, Western was into fundraising “in a big way.” The university had ended its Second Century Campaign, which raised $14 million from 1979-85, and was transitioned into the Renaissance Campaign, which raised $90 million from 1989-94. Campaign Western was on the horizon, launching in 2000.

But despite the success of those university-led ventures, the first hint of confusion was starting to develop among donors.

“When I started (in 2007), the questions were already there: Why the Foundation and why Western,” Pyka said. “You have Western employees ‘knocking on doors’ asking for funds and Foundation Western employees ‘knocking on doors’ asking for funds. Then you have donors saying, ‘I don’t get it. Why do I have two different groups asking me?’”

In 1998, all fundraising activities and personnel were consolidated with the university, leaving the foundation to turn its sole focus to endowment management. From that point, the foundation operated under the initiative that if a donation came from alumni, and was designated as an endowment, then it went to Foundation Western. All others went through the university.

The clunky methodology was one impetus for the unification. Another was the opportunity to manage Western’s endowment funds under one investment pool. Having one set of policies and procedures, while eliminating ambiguity, reducing overall cost and increasing investment opportunity, were all wins, Pyka said.

Although times change, Pyka added, the legacy of Foundation Western is quite clear.

“The foundation was formed to raise funds and get philanthropy going. We were successful in doing that. It was a great success. It was a tool that made sense in 1979. Is it a tool that makes sense in 2014? No.”

This story originally appeared in the May 22, 2014 edition of Western News.


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