June 29,2004

Grassley on Eligibility Standards for Foundation Boards

M E M O R A N D U M

To: Reporters and Editors
Re: Who serves on foundation boards
Da: Tuesday, June 29, 2004

According to media reports, the National Committee for Responsive Philanthropy todaycalled for a law to bar people from serving as officers of private foundations if the SEC has barredthem from serving on boards of publicly traded corporations. The report pointed to at least 13 peoplewho have served on foundation boards even though they have been linked to the recent wave ofbusiness scandals. Sen. Chuck Grassley, chairman of the Committee on Finance, last week conveneda hearing on charitable governance problems and released a 19-page, bipartisan staff discussion draftof proposed reforms, including prohibitions similar to what the National Committee for ResponsivePhilanthropy called for today. Grassley made the following comment on the issue.

“Publicly traded companies have a lot more scrutiny than tax-exempt groups. They haveshareholders and the IRS watching them. Tax-exempt groups have a board of directors to govern them, and that’s about it. If certain board members got a corporation into hot water, they shouldn’t be trusted to run charities and foundations. And there are lots of qualified people who aren’t white collar criminals to serve on these boards.”