Key Takeaways
- • NEPC, which sponsored and exhibited at the 2026 Finance, Administration & Operations Group (FAOG) conference for community foundations, identified three priorities emerging from the event: AI policy guardrails, a broad governance refresh, and peer learning before scaling new initiatives such as externally managed accounts (EMAs).
- • Community foundation leaders are moving from debating whether AI will affect their organizations to asking where it creates value and how to adopt it responsibly, while weighing cybersecurity, data protection, governance, and staff oversight risks.
- • Several foundation leaders are undertaking broad reviews of policies and procedures, some for the first time in many years, with AI-enhanced workflows, software platforms, and cybersecurity and data management identified as areas requiring attention.
- • Foundations evaluating EMAs, in which donor assets are managed by an outside investment manager or advisor while held at the foundation, are seeking peer input on how these accounts fit donor engagement strategies and investment offerings.
- • NEPC's Scott Harsh participated in a panel discussion on building and scaling EMA programs, with the broader takeaway that new initiatives succeed when governance, operations, and stakeholder communication evolve alongside them.
Summary
NEPC, an investment consultant, attended and sponsored the 2026 annual conference of the Finance, Administration & Operations Group for Community Foundations (FAOG), its third year exhibiting at the event. According to the firm, three priorities stood out for foundation leaders: setting guardrails for artificial intelligence, refreshing governance to reflect the current operating environment, and learning from peers before scaling new initiatives such as externally managed accounts.
AI was a dominant topic at the conference, and the discussion has matured since the prior year. Leaders are now focused on where AI can create value and how to use it responsibly across operations, governance, donor communications, and investments. Many organizations are experimenting with AI-powered tools to improve efficiency and reduce administrative burden, while evaluating risks related to cybersecurity, data protection, governance, and staff oversight. NEPC characterized AI as a catalyst for broader organizational reflection, noting that policies, governance structures, and training programs are as important as the technology itself.
The AI discussion has prompted several foundation leaders to undertake broad reviews of policies and procedures, some for the first time in many years. NEPC noted that many policies were written for a different environment and that technology, risks, and operational needs have changed. Areas leadership should consider include evolving software platforms, AI-enhanced workflows, and cybersecurity and data management enhancements. NEPC's assessment was that governance has not been neglected but would benefit from becoming more holistic, with legacy policies revisited to remain relevant for the coming decade.
Peer learning was a central value of the conference. Attendees sought exchanges with peers on AI policy development, internal controls, governance structures, and operational practices. This was particularly evident in discussions about EMAs, which many foundations are evaluating within their donor engagement strategies and investment offerings. NEPC's Scott Harsh joined community foundation leaders on a panel addressing how to build and scale EMA programs. NEPC concluded that foundations consistently emphasized establishing the right framework before scaling new ideas.
NEPC described the conference as evidence that community foundations are entering a period of intentional modernization. Priorities will vary by institution, but a shared willingness to challenge long-standing assumptions emerged as a common thread.
AI was a dominant topic at the conference, and the discussion has matured since the prior year. Leaders are now focused on where AI can create value and how to use it responsibly across operations, governance, donor communications, and investments. Many organizations are experimenting with AI-powered tools to improve efficiency and reduce administrative burden, while evaluating risks related to cybersecurity, data protection, governance, and staff oversight. NEPC characterized AI as a catalyst for broader organizational reflection, noting that policies, governance structures, and training programs are as important as the technology itself.
The AI discussion has prompted several foundation leaders to undertake broad reviews of policies and procedures, some for the first time in many years. NEPC noted that many policies were written for a different environment and that technology, risks, and operational needs have changed. Areas leadership should consider include evolving software platforms, AI-enhanced workflows, and cybersecurity and data management enhancements. NEPC's assessment was that governance has not been neglected but would benefit from becoming more holistic, with legacy policies revisited to remain relevant for the coming decade.
Peer learning was a central value of the conference. Attendees sought exchanges with peers on AI policy development, internal controls, governance structures, and operational practices. This was particularly evident in discussions about EMAs, which many foundations are evaluating within their donor engagement strategies and investment offerings. NEPC's Scott Harsh joined community foundation leaders on a panel addressing how to build and scale EMA programs. NEPC concluded that foundations consistently emphasized establishing the right framework before scaling new ideas.
NEPC described the conference as evidence that community foundations are entering a period of intentional modernization. Priorities will vary by institution, but a shared willingness to challenge long-standing assumptions emerged as a common thread.
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