If you have the option, I recommend against creating separately incorporated alumni associations and foundations. My reasoning boils down to:
i. Separate entities increase bureaucracy, meaning volunteers spend time preparing reports and registrations when they could be progressing initiatives to benefit your school. There are also additional financial costs e.g. audit preparation.
ii. Even if you have a great bunch of volunteers right now, there will almost inevitably come a time when cracks appear between the views of the leaders of these entities and the leadership of the school. This can become very time-consuming and stressful to resolve. I have worked in/advised several institutions where this had become a major issue, and where further time and resource was then needed to wind up the independent bodies.
iii. In 25 years I only recall one scenario where an independently incorporated foundation offered a material benefit over what could be achieved by operating fundraising and alumni relations within the school apparatus: a university that found this to be the only way it could sidestep restrictions on the salaries and employment contracts that they wanted to offer their development team. I imagine there must be some further benefits, but I haven’t observed them yet!
I’m also not a fan of charging a fee for membership of an alumni association unless there really is no other way to find the funds to get started. If a school is serious about development, I believe it needs to commit to resourcing it properly. Certainly the data from UK benchmarking shows an incredibly strong relationship between the levels and consistency of investment against fundraising performance. I’ve not seen data on alumni relations but it doesn’t seem too great a leap of imagination to conclude that the impact is similar. If development is recognised as strategically valuable to a school and is expected to return a positive ROI (not necessarily just counted in direct financial terms), it seems logical for the school to directly invest.
Charging for membership of an alumni association creates a barrier to participation in your school community, assuming that those who don’t pay get reduced communication and opportunities to participate, I don’t believe the revenue from membership fees will end up being worth the costs of finding and re-engaging these alumni down the line, nor the missed opportunities along the way to benefit from their advocacy, volunteering and philanthropy.
I’ll be interested to hear alternative experiences and perspectives though, so hope you get some more replies!
Director of Development