4-Step Process For Foundation Mergers

Due diligence, planning, integration and communication are the key steps identified in a report examining corporate philanthropy programs in the aftermath of a merger or acquisition.

The Council on Foundations (CoF), a Washington, D.C-based coalition of more than 2,000 foundations, released “Navigating Mergers and Acquisitions: Guidance for Corporate Philanthropy Leaders.”

“There’s no playbook when it comes to combining the philanthropic activities and programs of two enterprises. Yet the leaders charged with this important task regularly confront a variety of urgent questions,” President and CEO Kathleen P. Enright wrote in the foreword to the 23-page report. 

The study is meant to be a “roadmap” for addressing these questions through a four-step process to support making key decisions and combining philanthropies during times of a business merger or acquisition.

“Navigating Mergers and Acquisitions” examines four case studies: Anthem, Inc., J.D. Sports-Finish Line, General Mills and Blackbaud.

Based on conversations with corporate philanthropy practitioners and other experts, CoF identified four steps in the process of aligning and integrating corporate philanthropy programs in the event of a merger or acquisition:

  • Due diligence
  • Planning
  • Integration
  • Communication

The report provides what it calls a M&A Philanthropy Checklist — key considerations for corporate philanthropy practitioners at each of the four steps identified:

Due diligence

  • Chart the new grantmaking processes and procedures of the combined foundation;
  • Initiate a thoughtful sunsetting process for identified grantee relationships and signature programs;
  • Decide which technology platforms you will use for grantmaking and other philanthropic activities;
  • Review existing vendor relationships for duplication and gaps; and,
  • Define physical location of the foundation and new geographical footprint.

Planning

  • Structure of the philanthropy;
  • Priority issues and programs;
  • Areas of duplication of need;
  • Core philanthropic practices, philosophies, culture; and,
  • Plans for sunsetting relationships as needed.

Integration

  • Board and staff composition and roles;
  • Articles and bylaws;
  • Merger/transferal of assets;
  • Grantmaking processes and procedures;
  • Technology platforms;
  • Physical location (global footprint); and,
  • Vendor relationships.

Communication

  • Message development: What do you want people to know?;
  • Announcements to grantees, employees, and communities;
  • Media outreach;
  • Ongoing communications and outreach to key audiences; and,
  • Response to questions from key audiences.