June 2, 2006 | Read Time: 4 minutes
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Daniel Rice has had to reject as many as two dozen big gifts in his more than 20 years of raising money for World Vision, in Federal Way, Wash. The donors, he says, wanted their gifts — many in six figures — put into a permanent endowment, something World Vision, one of America’s largest humanitarian charities, did not have.
“I didn’t walk around with other groups’ phone numbers in my back pocket, but when I’ve had to tell people no, I assume they went elsewhere with their money,” Mr. Rice says. “That has always been a big disappointment.”
No longer.
In December a longtime donor, who has asked to remain anonymous, gave $3-million to start an endowment for World Vision, and the organization will soon add an additional $13-million from the sale of an office building it had been leasing out for years. By the beginning of 2007, World Vision will promote the fund to its major donors, hoping to increase its value to at least $50-million over the next few years.
“If donors are made aware that we have an endowment and that we welcome gifts, they’ll make them,” Mr. Rice says. “It’s the ‘if you build it, they will come’ idea.”
But building an endowment has not been so simple a concept at World Vision, founded as a Christian organization in 1950 to help children orphaned in the Korean War, regardless of their faiths. The organization has grown to provide relief to children in crisis around the world, spending more than $750-million last year on such efforts as bringing emergency supplies to victims of the South Asian tsunamis, providing sustenance to malnourished children in drought-stricken areas of Africa, and helping to fight the AIDS pandemic through prevention and care programs.
World Vision is among the most successful fund-raising organizations in the country, ranking No. 15 on The Chronicle of Philanthropy’s most-recent list of the 400 American charities that raise the most from private sources. And with a growing number of urgent needs to respond to, putting money away in a savings account, like an endowment, has long been considered “counterintuitive, even unseemly” by many of the charity’s leaders and supporters, says Richard E. Stearns, World Vision’s president.
“We have never wanted to be an organization that is stashing away dollars at the same time that children are starving,” Mr. Stearns says.
Another factor that had kept the idea of an endowment at bay: the religious belief that God will provide.
“The old-timers have stories that in the 50s and 60s, the staff would actually get together to pray there would be enough money to meet payroll,” Mr. Stearns says. “We are a much more successful and financially sophisticated organization now, but we are still an organization that believes we depend on God to help us move forward.”
To ease into the idea of saving money for future needs, World Vision’s endowment, for now at least, will be used exclusively to finance programs linked to the group’s Christian identity. The endowment will have four pools of money — one for emergency-relief work, one for helping children in continuing crisis situations, another unrestricted, and another called the Christian Commitment Fund — to which donors can designate their gifts. Only the latter, the Christian fund, is accepting contributions so far.
In keeping with the organization’s religious bent, the endowment will steer clear of investments considered antithetical to the group’s values, such as stocks related to gambling, pornography, or tobacco businesses.
World Vision officials say the new endowment money will be invested mostly in fixed-income vehicles, such as bonds, to ensure the availability of spending cash, but with a view toward long-term growth.
Money from the Christian Commitment Fund, at least $2.5-million a year if the assets grow to the planned $50-million, will help pay for such things as promoting the involvement of local churches in World Vision projects and for the spiritual training of the charity’s staff. World Vision now devotes a tiny fraction of its budget, about $3-million a year, to such efforts.
Depending on how the Christian Commitment Fund, and the idea of an endowment in general, is received by World Vision’s supporters, the charity will open the endowment’s other funds and raise money for them, too.
“Starting out like this will demonstrate that we are not looking to steal from Peter to pay Paul,” Mr. Stearns says. “We want donors to give to the endowment in addition to their annual gifts that support our critical work here and around the world.”
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Section: Endowments
Volume 18, Issue 16, Page B17
