Governance, Compliance and Culture: What Philanthropic Foundations Need to Know

by: Catriona Hogan

I have worked in the not-for-profit sector for over 25 years, and some of the most rewarding aspects of my work in recent years have been advising philanthropic organisations on their governance and compliance journey, while also engaging with the Charity Regulator on various initiatives. Wearing both of these “hats” gives me a unique perspective on the challenges and opportunities facing philanthropic foundations today.

Earlier in my career, I undertook specialist training in philanthropy and fundraising in the United States. That experience opened my eyes to the transformative power of philanthropy and the scale of impact it can achieve when it is done well and supported by strong structures.

Today, philanthropy is gaining broader recognition in Ireland. The Government’s National Philanthropy Policy 2024–2028 is a clear signal of the value placed on philanthropy’s contribution to Irish society. As the sector continues to grow, so too does the need to ensure that governance and compliance keep pace.

Following the recent Philanthropy Ireland briefing with the Charity Regulator, I will be hosting an upcoming members-only webinar that explores these issues in more depth. The session will focus on governance and compliance for grant makers, whether operating as registered charities or through other structures and will build on many of the themes raised during that discussion.

This blog offers a short preview of some of the areas we will explore.

Increased Profile, Increased Responsibility

We are operating in an environment where trust, transparency, accountability and public scrutiny are more prominent than ever before. Philanthropic organisations are not immune from this, in fact, the expectations placed upon them are often very high.

One point I often emphasise when working with foundations is that if you expect strong governance and best practice from the organisations you fund, you must hold your own organisation to the same - if not higher - standards. Governance cannot be something we require of others while treating it lightly ourselves.

Understanding the Different Structures

Philanthropic foundations in Ireland operate under a number of different legal structures. These can include:

• Company Limited by Guarantee (CLG) structures that report to both the Companies Registration Office and the Charity Regulator

• Charitable Trusts

• Unincorporated Associations

While these structures differ in legal form, the underlying expectations around governance and accountability remain broadly similar.

In the upcoming webinar, I will touch on these different structures and discuss how governance and compliance responsibilities apply across them. The discussion will focus particularly on foundations that are registered charities, where regulatory expectations are more clearly defined.

Governance Responsibilities for Grant Makers

It is sometimes assumed that grantmaking foundations face fewer governance obligations because they distribute funds rather than deliver services directly. In reality, trustees of these organisations carry significant legal and fiduciary responsibilities.

Trustees must ensure they act in the best interests of beneficiaries, manage conflicts of interest appropriately, maintain strong financial oversight and safeguard the organisation’s assets and reputation.

Even where a foundation’s primary activity is making grants, strong governance remains essential to ensuring that funding decisions are transparent, accountable and aligned with the organisation’s mission.

Governance as Culture, Not Just Compliance

One of the most important lessons I have learned in my work with philanthropic organisations is that compliance should never be treated as a simple tick-box exercise.

Strong governance is ultimately about culture.

In practice, this means having:

• Active and engaged boards

• Independent oversight and challenge from trustees

• Regular board effectiveness reviews

• A clear and regularly updated risk register

• Strategic and annual planning processes

• Accurate board minutes and documentation

• Ongoing trustee training

• Robust financial reporting and internal controls

Good intentions alone are never enough. They must always be supported by proper systems, oversight and accountability. 

Common Governance Challenges

Through my work advising philanthropic organisations, I have seen a number of governance challenges arise repeatedly.

These can include:

• Poor management of conflicts of interest

• Weak financial controls

• Passive boards that do not sufficiently challenge decisions

• Limited independence among trustees

• A lack of structured risk management

• Low levels of transparency due to the perception that it is “private money”

• Informal cultures that can override proper governance processes

Most of these issues do not arise from bad intentions. More often, they stem from a lack of clarity about roles, responsibilities or regulatory expectations.

Why Governance Matters

Charitable status brings important advantages, including legal recognition, public trust and tax benefits. With those advantages comes an expectation that organisations will meet high standards of accountability and transparency.

When governance fails, the consequences can be serious- including reputational damage, loss of public trust or even the risk to charitable status itself.

For me, strong governance should not be seen as a burden. It is the foundation that allows philanthropic organisations to deliver their mission with integrity, confidence and long-term impact.

Looking Ahead to the Webinar

Ireland’s philanthropic landscape continues to evolve, presenting significant opportunities for foundations and grant makers to create meaningful impact.

In the upcoming Philanthropy Ireland members’ webinar, I will explore these issues in greater detail and share practical insights on governance and compliance for grant-making organisations.

My hope is that the conversation will help foundations strengthen their governance practices while continuing to support the vital work of the organisations they fund.