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| Philanthropy |
The Paradox of Perpetuities
Matthew Schuerman
01/01/2004
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Richard Goldman, the widower of an heir to the Levi Strauss fortune, believes history has proven Rosenwald right. "I’ve been disappointed that so many of these foundations have become very self-serving for the people running them," he says. A benefactor of Jewish and environmental causes, he plans to spend as much as possible of the remaining $430 million in the Richard and Rhoda Goldman Fund by the end of his life, willing the remainder to his daughters’ foundations. "I think that’s the purpose of philanthropy, not to build reserves but to give away money," says Goldman, who is 83. "The word perpetuity bothers me because I can’t measure it. What’s perpetuity? When does it end?"
Most family foundations are structured to live forever. A survey conducted in 2003 by the Council on Foundations found that only 11 out of 169 officers said their family foundations were established with the intent to go out of existence at some point. Some 108—almost two-thirds—indicated that either the founder or current board members believed they should keep the foundation going forever.
The reasons are numerous. Ike Leighty, a manufacturer from Waterloo, Iowa, regards his foundation—now valued at $6 million—as an instrument to bring his family together as much as a means to accomplish good. For that reason, he wants his children to keep the foundation running after his death. "He thinks it’s a good way for a family, especially a family that is geographically dispersed, to work with and to get to know each other and appreciate our differences, instead of just getting together for Christmas," says Jane Leighty Justis, his daughter and a fund trustee. At the same time, the senior Leighty, now 88, recognizes that rather than drawing his heirs together, disagreement over how to spend the money might drive them apart, at which point he has given written permission for the trustees to turn over the endowment to a community foundation. Even with this provision, challenges persist. "With each generation," his daughter notes, "it definitely gets more complex."
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