Talk:Wikimedia Endowment

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Previous discussions ...

can be found here: Talk:Wikimedia_Endowment/Archive_1. (It's a bit unusual to archive everything on a talk page. Community convention is to leave at least some recent discussion on any talk page, rather than presenting people with an empty page.) --Andreas JN466 15:31, 22 September 2021 (UTC)

I disagree. If nobody has commented on a page in, say, five years, the "don't archive everything" enshrines that last comment, usually without the context of earlier comments. For seldom-updated talk pages, it is better to archive everything after 90 days. --Guy Macon (talk) 13:07, 2 October 2021 (UTC)

But I commented on a discussion on 11 September 2021, and less than five days later my comment was archived without a direct response from User:JBrungs (WMF). Then, only after that discussion was archived did she fix the broken link that I'd pointed out. This action violates the spirit of en:Wikipedia:Talk page guidelines#Editing own comments: "But if anyone has already replied to or quoted your original comment, changing your comment may deprive any replies of their original context, and this should be avoided. Once others have replied, or even if no one's replied but it's been more than a short while, if you wish to change or delete your comment, it is commonly best practice to indicate your changes".

Now my comment in that archive lacks context and sounds snarky. I understand whoever wrote that "404 error message" Imagine a world in which there is a page here was trying to be cute, but there's a fine line here between coming across as cute and sounding snarky.

At least now, I can find the report and read footnote 6, which I couldn't before. Wbm1058 (talk) 14:24, 2 October 2021 (UTC)

Quite, thanks. For context, the WMF announced on September 22 that the Endowment had passed $100 million in June, i.e. three months earlier. The announcement included a link to this talk page, with an invitation to "join the conversation".

So it is arguably somewhat ironic that this talk page, which had not been archived once in five years, was archived just prior to that announcement, thereby removing all the existing conversation, some of it quite recent, and presenting a blank page.

I can understand the idea of making room for fresh discussion ... I just thought it went a bit too far, and I didn't want visitors coming to this page thinking there had never been any discussion or controversy before that might be of interest to them. (While Wikimedia insiders would recognise an archive box, and know how it works, I wouldn't necessarily expect new visitors to notice it and click on the little "1".) Cheers, --Andreas JN466 11:39, 3 October 2021 (UTC)

Lack of mention in Form 990, question about who controls the Endowment

According to the Wikimedia Foundation's Form 990, the WMF does not "hold assets in temporarily restricted endowments, permanent endowments, or quasi endowments" (page 6, Part IV, line 10, which asks about these, is answered "No"). The 2019 Wikimedia Foundation Form 990 FAQ document explains that this is because

• The Wikimedia Endowment is established and held by a separate legal entity (Tides Foundation) with its own separate Board and Advisory Board that has the authority to control and govern the Policies and Practices of the Endowment Funds. The Foundation and the Foundation’s Board do not have any direct or indirect ability to determine the direction of management and policies of the Endowment Funds. As such, per US Accounting Standards, in which the Internal Revenue Service (IRS) follows for the Form 990 reporting purposes, the Endowment Funds are not required to be reported within the Foundation’s financial statements on our Independent Auditors’ Report and Form 990.

But then again, the Wikimedia Endowment page (overleaf) says,

• The Endowment was launched in January 2016 (on the 15th anniversary of Wikipedia) with the initial goal of raising 100 million dollars to support the Wikimedia projects. The funds may be transferred from Tides either to the Wikimedia Foundation or to other charitable organisations selected by the Wikimedia Foundation to further the Wikimedia mission.

This appears to imply that the Wikimedia Foundation has complete control over where the money goes – it can only be transferred either to the WMF itself, or to other charitable organisations selected by the WMF.

I was wondering what the advantage is of setting up the Endowment in such a Janus-like way that it can be described both as something completely outside of the WMF's control for the purposes of the Form 990 and as something completely within its control for the purposes of Meta. I asked about this both on the Wikimedia-l mailing list and on the Form 990 talk page back in July, but never received a reply. Can anyone help? What am I missing? --Andreas JN466 15:58, 22 September 2021 (UTC)

Thank you for your questions. The original plan was successful for the initial setup of the Endowment to be with Tides so we at WMF could focus our energy on fundraising. We are now at the planned stage of maturity to move the Endowment to a separate public charity 501(c)(3). More details about the setup of the 501(c)(3) as well as information about the Endowment Board's plans for the investment income will be shared in the next few months. We anticipate this to happen in early 2022. JBrungs (WMF) (talk) 09:05, 28 September 2021 (UTC)

Thank you, Julia. I think the problem lies with the expression "The Foundation and the Foundation’s Board do not have any direct or indirect ability to determine the direction of management and policies of the Endowment Funds. What does that mean in concrete terms? Clearly the Foundation controls who the funds can be transferred to (they may be transferred from Tides either to the Wikimedia Foundation or to other charitable organisations selected by the Wikimedia Foundation to further the Wikimedia mission), so the "direction of management and policies" must be referring to something else – could you please find out what exactly that phrase means here? And would I be correct in assuming that the new charity will again be separate from the Foundation in the same way as Tides Advocacythe Tides Foundation is, so the Endowment will not have to be reported in the Form 990? Regards, --Andreas JN466 18:52, 3 October 2021 (UTC)

Hi Andreas,

We will be able to share more details on the Endowment Board's plans and policies in early 2022 after the new public charity has been established. JBrungs (WMF) (talk) 13:05, 4 October 2021 (UTC)

I am sorry, Julia, but the question about what the phrase do not have any direct or indirect ability to determine the direction of management and policies means relates to the present set-up with Tides Advocacythe Tides Foundation, rather than the future charity. Could you ask Tony Le what he meant by that? He originally wrote it, but has not been back to that page. Regards, --Andreas JN466 18:18, 4 October 2021 (UTC)

@Jayen466: FYI: Tides and Tides Advocacy are not the same organization. The former is used by the Endowment, while the latter has been used by the WMF's "Knowledge Equity Fund". --Yair rand (talk) 21:35, 4 October 2021 (UTC)

@Yair rand:: Thanks for catching this. I knew this, but lost the plot for a moment. Amended above. --Andreas JN466 23:07, 4 October 2021 (UTC)

Wikimedia Endowment only represented as an expense in audited financial statements, upcoming FAQ

As described here and confirmed here (question 3), the money held in the Endowment is not included in the net assets of the Wikimedia Foundation, as those funds are held by the Tides Foundation. Nor is money received by the WMF for the Endowment included in WMF revenue. However, when the Wikimedia Foundation makes payments to its own Endowment Fund, those are reflected as Awards and Grants expenses in the Wikimedia Foundation's audited financial statements. They have amounted to $5M a year for the past six years.

FAQs published in past years along with the WMF audited financial statements made no reference to the fact that the annual Awards and Grants expenses included $5M the WMF paid into its own endowment, and that the revenue and net assets figures did not include the Endowment, thereby making the WMF operating surplus appear rather smaller than it really was.

This year's audited financial statements and associated FAQ are due to be published next month. Could we please make sure that the Endowment aspect is covered appropriately this year? Pinging Tony Le. Thanks. --Andreas JN466 19:20, 23 September 2021 (UTC)

In last years FAQs under the “What’s the overall takeaway?” section you will see that it reads We increased our awards and grants as we continue our commitment to support our Affiliates, Organized Groups, and Community Members, and to build our Endowment (a $5 million payment to the Endowment is included in the awards and grants total).

We will continue to disclose the contributions of the Wikimedia Foundation to the Endowment in this year's FAQ as well. JBrungs (WMF) (talk) 07:02, 29 September 2021 (UTC)

Thanks, Julia. The reason last year's FAQ includes that reference to the Endowment is because I added it, long after the FAQ was first published. I am glad to hear a similar reference will be included in the next FAQ from the beginning. Regards, --Andreas JN466 23:19, 1 October 2021 (UTC)

Questions from mailing list

The following has also been posted to the Wikimedia-l mailing list.

Dear Lisa and all,

According to Meta and the just-released WMF Advancement fourth-quarter tuning session deck, the Endowment actually passed the $100-million mark not this month [the announcement that it had done so was made on September 22], but three months ago – in June, before the start of this current financial year. The Meta page e.g. says:

The Endowment reached our initial $100 million goal in June 2021. The goal was set as part of a ten-year plan from 2016-2026.

https://meta.wikimedia.org/w/index.php?title=Wikimedia_Endowment&diff=22056029&oldid=21872920

This means the Endowment grew by around $40 million in the 2020/2021 financial year alone – about as much as in the three previous years together – based on this Meta edit by Endowment Director Amy Parker, who stated that on June 30, 2020, the Endowment stood at $62.9 million:

https://meta.wikimedia.org/w/index.php?title=Wikimedia_Endowment&diff=next&oldid=20308708

I say "around $40 million" because if the Endowment grew from $62.9 million on June 30, 2020, to over $100 million sometime during June, 2021, at least $37.1 million (and probably a little more) must have been added to it in the 2020/2021 financial year.

Now, according to the just-released WMF Advancement fourth-quarter tuning session deck, in the 2020/2021 financial year the Foundation raised ...

• $154 million for the Foundation (vs. an initial target of $108 million)
• $18.9 million (vs. a target of $5 million) for the Endowment

https://commons.wikimedia.org/w/index.php?title=File%3AWikimedia_Foundation_fourth_quarter_2020-2021_tuning_session_-_Advancement.pdf&page=12

I've been told by WMF staff that the WMF receives two kinds of moneys for the Endowment:

• Some are "pass-through" donations to the Endowment. These are moneys received by the Foundation that are passed straight on. They enter the Endowment directly and do not appear in the Foundation's Revenue, Assets or Expenses figures.
• Some are ordinary WMF revenue, reflected in WMF Support and Revenue totals, which is then used to make a Foundation grant to the Endowment. Such WMF grants to the Wikimedia Endowment are included in the Foundation's expenses total, under Awards and Grants. My understanding was that this has been $5 million per annum (equalling the target mentioned in the above slide), for the past six years.

Question 1

So what are the $18.9 million for the Endowment in the tuning session deck? Does that mean that the WMF, in the last financial year, took $172.9 million in revenue ($154M + $18.9M) and made an $18.9 million grant to the Endowment? Or are these $18.9 million pass-through gifts to the Endowment, which won't show up in the Foundation's financial statements at all, and the annual $5 million came on top of that, out of the $154 million?

Question 2

At any rate, given that the Endowment evidently grew by at least $37.1 million in the last financial year, the $18.9 million mentioned in the tuning session deck are about $20 million short. Where did the other money come from, given that it seems to have been so much more than in previous years? Were there any particularly large gifts from companies or foundations? The only major gift mentioned on the Meta page is a $1 million gift from Amazon.

I am sorry for the many questions, and apologise in advance for any misunderstandings on my part, but I find the Endowment set-up completely impenetrable and non-transparent.

There is no Form 990 documentation, because the Foundation says on the Form 990 it does not have any Endowment assets, and there are no timely updates or audited financial statements about money going into the Endowment or coming out of it. I wish this were different. --Andreas JN466 18:13, 4 October 2021 (UTC)

These questions were answered on the 2020/21 Fundraising Report talk page. JBrungs (WMF) (talk) 08:50, 13 October 2021 (UTC)

Tides Foundation relationship

Julia, could you please explain how the financial relationship with the Tides Foundation works? Tides presumably takes some payment for its services. How is that handled?

Does Tides charge a management fee, or a commission on income generated from investments, or retain some of the investment income (e.g. anything in excess of some agreed percentage) in lieu of payment for its managment services? How should people think of the service relationship?

Could you say how much money Tides has made from the Wikimedia Endowment since it was set up in 2016? And are there any other beneficiaries (consultants e.g.) that have received payments out of the funds collected for the Endowment? Thanks, --Andreas JN466 11:43, 20 October 2021 (UTC)

Hi Andreas,

We have an agreement with the Tides Foundation which covers the administration of the Endowment. As a matter of practice, we do not disclose specific terms of contracts with our vendors. You can see more about the setup with Tides and the plan to set up a separate 501c3 on the Endowment FAQ. JBrungs (WMF) (talk) 05:49, 29 October 2021 (UTC)

Isn't Tides supposed to be a charity? Why would they want to be treated like any for-profit "vendor"? What's the rationale behind keeping their rates secret? Nemo 14:52, 29 October 2021 (UTC)

I don't know about this case, Nemo, but generally speaking, the most common purpose of persistent secrecy is to hide misconduct, or at least to keep things under wrap that would "look bad". What else is there to gain from secrecy?

The WMF has been saying for five years now that it will soon transfer the Endowment away from Tides and to a standalone 501(c)(3) organisation – an arrangement that would at least ensure the legally mandated minimum amount of transparency, with audited accounts and so on. In 2017 we were told on this page that this would happen once the Endowment reached $33 million. This was described as a board decision. But when the time came, it seems the idea of transparency caused discomfort, and the board quietly changed its mind. No announcement of this change in plans was made, no reason was given. The Endowment passed $100 million in June 2021, with still no 501(c)(3) organisation in sight, no audited accounts ever published. --Andreas JN466 12:51, 3 March 2022 (UTC)

IEEFA: Major investment advisors BlackRock and Meketa provide a fiduciary path through the energy transition

We're laggards, but it's easy to catch up. https://ieefa.org/major-investment-advisors-blackrock-and-meketa-provide-a-fiduciary-path-through-the-energy-transition/ Nemo 14:49, 29 October 2021 (UTC)

Andreas Kolbe's Signpost article; request for regular monthly updates

@JBrungs (WMF): Julia, I hope you have read Andreas's article in the current edition of the Signpost. It was a real eye-opener for me, and I believe the issues therein rise to the level of a bona fide financial scandal at this point. In addition to addressing the questions in the article, I am asking that the Foundation provide, each month going forward:

1. the total market value of the Endowment;
2. the number and value of Endowment donations and bequests over the past month;
3. the composition of all the securities and other financial assets held by the Endowment, with each of their individual line-item values;
4. all transactions over the past month for any Endowment holdings;
5. a list of all investment decisions taken, including rebalancing actions, whether by the Endowment Advisory Board or the administration;
6. a report of the work done in the past month to transfer the Endowment to an IRC 501(c)3 organization, and the status of all pending efforts toward that end with their expected resolution date; and
7. an attestation from each member of the Endowment Advisory Board that they have reviewed the information above along with any comments they each personally may have.

Will the Foundation start issuing that information monthly, please? New4Q (talk) 18:04, 30 May 2022 (UTC)

Thank you very much for your comments and thoughts. We will be publishing an update on work for the Endowment, the Endowment Board, and governance later this month. JBrungs (WMF) (talk) 07:38, 6 June 2022 (UTC)