FIS Foundation: Questions and Answers
Below, please find more information about the FIS Foundation through a series of questions and answers. If you still have questions that are not addressed in the list below, please send your inquiry to Paul_Fochtman@fis.edu
Why is the Foundation necessary as opposed to simply adding funds to FIS?
FIS is currently structured as an Association in Germany, with the purpose of using its assets and operating revenue to meet annual expenses. For legal and tax reasons, the new entity is not an Association, but rather a Foundation that is able to protect the principal asset as well as future donations. The Foundation's purpose is to provide financial security and investment income to the school for many generations to come. In its mission, this Foundation represents the highest values and aspirations of our school.
Is the Foundation governed by the FIS Board of Trustees?
Yes. The supervisory Board of the FIS Foundation is the same as the FIS Board of Trustees. Therefore, the highest governing body that manages school finances is made up of the same individuals who govern the Foundation. Professionals have also been appointed to the Foundation to manage its investments and day-to-day affairs.
How are Foundation Board members chosen and how long are their terms?
The Foundation Board members are appointed by the FIS Board of Trustees for a three-year term. At the end of the term, or if a member must vacate the position prior to the end of a term, the FIS Board of Trustees will make the decision to either extend the term or find a qualified candidate with the unique skills and background needed to fill the position.
How will the endowment funds be invested?
As required by German law, a Foundation is required to pursue appropriate investments that will preserve the capital of the endowment. Investment professionals will work with the Foundation’s Executive Board to manage the endowment’s investments.
How will the donated funds be used?
The FIS Board of Trustees has extensively discussed how to best use and preserve the Stroth donation and the vast majority of these funds has been placed under the stewardship of the FIS Foundation. It is common for leading schools and universities around the world to have an endowment fund that acts as both a source of income to be used for enumerated purposes, as well as a basis of financial security to protect and support the school for future generations. While many top schools and universities have endowments many times the size of their operating budgets, over time FIS hopes to grow its own endowment to equal roughly one-year’s operating costs (€35 million).
A portion of the Stroth bequest has been used to address and accelerate a number of pressing components of the school’s pre-approved plan to improve FIS safety and facilities.
Has the Stroth's donation impacted school tuition or its spending practices?
No. We believe that this generous gift was made to ensure the stability of the school and provide increased opportunities for students over the very long term. Accordingly, funds will not be used to reduce tuition for students currently on campus, as we do not believe this is in the spirit of the gift. Income from the Foundation may well assist our tuition reduction program in the future, although it is expected in the early years of operation, that income from the FIS Foundation will not add significant income to the operation of the school due to current low interest rates and present financial environment. However, as the endowment in the Foundation grows over time by its income and hopefully by additional donations, it will offer income to fund opportunities for the school that otherwise would not be possible.
Will we use parts of the bequest to hire new teachers or add new programs?
We expect that we will add to the faculty (short or longer term) and/or programs of the school over time using income from the Foundation. However, we believe that the spirit of the gift demands us to ensure these kinds of investments remain possible over the very long term.
What is the background of the donors?
Drs. Ralf and Hazel Stroth were a German/American couple who were among the earliest families who helped establish FIS in Germany. Dr. Ralf Stroth was a lawyer who used his professional talents to help establish FIS in 1961, and his wife was actively involved in the school community during its early years. Their two children attended FIS through Grade 10, at which they transferred to attend a local school to obtain the Abitur Diploma. Both of the Stroth children have also passed away, leaving Drs. Stroth with no surviving children or grandchildren. More than 50 years ago, the Stroth family helped provide FIS with a strong footing as it began its operation in Frankfurt. Now, more than 50 years later, their legacy lives on as the school uses the Stroth donation with the aim to continue responsible stewardship for the next 50 years and beyond.