Dame Stephanie Shirley: Spending out is not as easy as it sounds

The founder and chair of the Shirley Foundation discusses the funder's decision to wind down and how closing can be complicated

Dame Stephanie Shirley CH
Dame Stephanie Shirley CH

Today’s culture leads not-for-profits to focus on youth, start-ups and entrepreneurism generally. But there are also occasions when the right thing to do is to close a charity down.

And so it was with the grant-giving the Shirley Foundation. The foundation was a relatively young funder – it had been founded in 1994 – but had given away more than £60m and had less than £1m left by the time the trustees took the decision to spend out in 2016.

There were no staff and only a few contracts, so I laughed when reading the Association of Charitable Foundation’s advice to allow two years to spend out. How could it possibly take that long?

First, of course, there was the formality of minuting the decision. After a comprehensive discussion at the end of 2016, the foundation was refocused to finish positively and cease operations by the end of 2018.

I investigated past and current trusts that had merged or spent down. All were helpful in discussing their experiences.

One, the Emmandjay Charitable Trust, had actually sent us a spontaneous contribution when it was spending out. Another, the Tubney Charitable Trust, was about our size and seemed a model of spending out well. It had a beautifully produced 100-page report that even included a congratulatory letter from HRH the Prince of Wales.

Several funders, including the Northern Rock Foundation and the Diana, Princess of Wales Memorial Fund, referred to the importance of archiving material. So I decided to focus on the legacy concept and what our trustees wished to leave behind.

The trustees felt that the foundation’s success in raising the profile of autism was of itself a good legacy. They agreed to transfer investments and bank assets to the medical research charity Autistica, which we had helped to set up in 2004, and we started to work on novation agreements, writing off about half of an 18-year-old debt from an independent charity and generally tidying up.

There was a lot of administration. My innovative contribution was to arrange for the Shirley Foundation to be the founder depositor and initial funder of a UK philanthropy archive at the Canterbury campus of the University of Kent. This aligns with the university’s established Centre for Philanthropy and my own service as the national ambassador for philanthropy in 2009/10, and adds to the general resources on charities.

We received the last project progress report towards the end of 2018 and were hoping to close early in 2019. But a small external donation in the first quarter of 2019 meant that the three-month waiting period between last transaction and final closure had to be restarted.

Overall, I’m really proud of what has been achieved. In 2004, we commissioned a 10-year impact assessment and in 2014 we also contracted an independent research organisation to produce an evaluation of our funding since 1994.

The first concluded that the larger projects were more effective, pro rata, in our disruptive giving.

The 20-year evaluation found that 94 per cent of the grants we made had the intended results and, in some circumstances, had unintended outcomes, adding significant value to the grants. I was more than happy with that. What came as a surprise was the number of beneficiaries who felt they had benefited from our involvement, which was summarised as "inspirational".

What do I regret? The foundation was weak on social media. Its investments were not mission-led and we never managed to measure indirect value. It relied on the strength of my personal brand.

But these are small disappointments compared with its achievements, which include: setting-up the IT livery company and the Oxford Internet Institute; founding three autism charities that collectively employ about 1,000 staff; and providing initial funding for six autism projects and saving three not-for-profits.

All in all, the Shirley Foundation has supported some 70 projects through venture philanthropy. How long is its spend out taking? Well, somewhat over  two years.

Dame Stephanie Shirley CH is chair of the Shirley Foundation and was appointed a Companion of Honour for her entrepreneurism and philanthropy in 2017

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Already registered?
Sign in
Follow us on:

Latest Governance Jobs

RSS Feed

Third Sector Insight

Sponsored webcasts, surveys and expert reports from Third Sector partners


Expert Hub

Insurance advice from Markel

Charity property: could you be entitled to a huge VAT saving?

Charity property: could you be entitled to a huge VAT saving?

Partner Content: Presented By Third Sector promotion

When a property is being constructed, VAT is charged at the standard rate. But if you're a charity, health body, educational institution, housing association or finance house, the work may well fall into a category that justifies zero-rating - and you could make a massive saving