The Rotary Foundation in the 21 st Century

Good News

Program Good News, Program Achievements PolioPlus $633/23.7million 3H Grants 18/$4.2 million Matching Grants 2008/$34.3 million DSGs 379/$5.1 million Volunteer Service 202/$1 million

Program Good News, Program Achievements Peace Fellowships50/27/$4.3 Ambassadorial822/50/$13.9 Teachers29/9/$.4 GSE558/$4.3

Financial Results Good News, Investment Earnings $105.4 Contributions $125.3 Program Awards $98.0 Program Ops $18.6 Fund Dev $12.6 $135.5 Expenses $230.7 Revenues G&A $6.3 Net Increase $95.2

The Rotary Foundation Revenue Trends US$(millions) Record Year!

The Rotary Foundation Contribution Trends US$(millions) ____PEFC____

The Rotary Foundation Total Awards & Expenses US$(millions) 86%

The Rotary Foundation Net Assets US$(millions)

Net Assets at 30 June 2007 US$738 million $475 $37 $220

Good News, Arch Klumpf Society 26 Major Donors 1,251 Bequest Society Committed 592 Benefactors 3,473 New PHFs 57,190

Good News, TRF Annual Goals Polio Eradication is realistic Every Rotarian, Every Year Rotary Centers For International Studies in peace and conflict resolution Reconnecting with Foundation alumni

Good News, Future Visions 1.Simplify all programs/operations 2.Align program outcomes 3.Increase participation/ownership 4.Provide sufficient resources 5.Develop a business model

Keeping the Trust-- Stewardship Matters

Stewardship  What is Stewardship?  Why is Stewardship important?  Who has responsibility?  Have there been problems?  How are problems resolved?  What’s being done for the future?  What can we do?

What is Stewardship? Stewardship Stewardship is defined as financial management and program management. A Steward A Steward is a person or entity that manages another's property (The Rotary Foundation) or financial affairs (grant funds); one who administers anything as the agent of another or others.

Why is Stewardship important? Increased giving Financial Accountability Organization Reputation

Increased Giving The Development Relationship Cycle Prospective Donors IdentifyQualifyCultivateSolicit“No” “Yes” STEWARDSHIP Reporting on gift impact -

Accountability Financial Accountability  Necessary to keep charitable tax status Organizational Accountability  Important for maintaining partnerships with other organizations  Affect rankings when for non-profit organization reports (Guide Star)

Who is responsible?  Everyone from individual Rotarians to the RI President  Corporate responsibility  Districts are accountable for the member clubs  Clubs are responsible for their members

Have there been problems?  Over 100 allegations of misuse or mismanagement in the last 5 years  Problems range from lack of understanding of grant guidelines to intentional embezzlement of funds  In the last year allegations reduced from 100 to 25

What types of Problems?  Diversion of Funds  False Documentation  Conflict of Interest  Irresponsible Management  Ineligible Contributions  Individual Monopolizing Grants  Falsified Membership Records

How are allegations addressed?  Requesting additional information from the sponsors  Requiring problem remediation for the beneficiaries  Assistance from district or zonal leadership  Sending Cadre members  Contracting audit firms

Resolving Allegations Substantiated  Clubs/Districts required to return funds  Termination of Clubs  Sanctioning of Officers  Litigation

What’s being done for the future?  Stewardship Plan  Conflict of Interest Policy

Stewardship Plan Goal #1 Expand Zonal coverage in providing stewardship training tools to district leaders

Goal #1 Stewardship Seminars  District 3280 (Bangladesh)*  District 4450 (Peru) *  Zone 9 (Korea)**  Zone 14 (Germany) **  Los Angeles Convention** *grant management focus AND **best practices focus

Goal #2 Increase the technical capacity of the cadre, particularly in the auditing area.  Meeting of the Cadre Chairman and Technical Coordinators  Specialized Auditor initiative Stewardship Plan

Goal #2 Humanitarian Grants Cadre  Over 250 Rotarians serve as Cadre members  Rotarians help each other strengthen projects  Specialized Auditors are a subset of the Financial and Auditing Sector

Goal #3 Leveraging Rotary/zonal leaders to work with districts that are found to be struggling to maintain compliance with reporting.  World Reporting Stewardship Plan

Goal #3 World Reporting To increase the percentage of current and compliant reporting for all RI Districts  A world reporting analysis will be compiled twice a year tracking each district’s % of reporting on open grants.  Districts with reporting below 70% after 2 consecutive analyses may be suspended from participating in the grants program.

Goal # 4 Addressing all allegations quickly and fairly  Address allegations  Random audits Stewardship Plan

Goal #4 Allegations Focus Mismanagement  irresponsible execution of a grant Misuse  intent to wrongfully benefit from a grant

Goal #4 Investigations  Issues regarding conflicting political and personal agendas are sent to Club and District Support (CDS)  Misuse or mismanagement issues with ample “evidence” sent to general secretary to review options for resolution.

Additions to the Code of Policy NEW Conflict of Interest NEW  October 2006 Trustee decision  Supports transparency in business transactions to avoid any actual or perceived conflict of interest by requesting disclosure of Rotarian involvement

What can we do? Facilitate and encourage Rotarians to fulfill:  Legal obligations to TRF  Stewardship responsibilities  Reporting responsibilities  Partnership obligations

What can we do?  Assist the Foundation in evaluating project sites facing challenges  Be aware of the projects in your districts  Report misuse and suspected misuse of funds to TRF  Lead by example  Educate about appropriate fundraising and contributions

“Where large sums of money are concerned, it is advisable to trust nobody.” Agatha Christie “Learn from yesterday, live for today, hope for tomorrow. The important thing is not to stop questioning.” Albert Einstein