Wikimedia Foundation Board noticeboard/June 2022 Meeting Outcomes from Wikimedia Foundation Board of Trustees/Working Capital Reserves Policy
The framing of the Wikimedia Foundation’s mission statement ends with two words: in perpetuity. Our unique funding model – which has diversified over the decades – has allowed us to build a stable base to serve billions of readers and to support volunteer communities that make our projects possible.
Our revenue strategy works to ensure that free knowledge will be accessible in perpetuity. One key response to this has been the establishment of the Wikimedia Endowment, a permanent fund that can help protect Wikipedia and Wikimedia projects in times of uncertainty and enables long-term investments to support their growth. This is similar to the approach taken by many colleges, universities and media organizations in responding to long-term needs.
Alongside this, it is common and prudent for organizations of all types to have financial reserves and working capital policies. This is true for companies, non-profits, and even governments. There are a range of benchmarks that provide guidance on the level of reserves that are considered appropriate for an organization of a given size and budget. We have looked at this informally over the years for the Foundation and have also ensured that our grantmaking provides funding for reserves to our affiliates.
This year we asked the board to consider a more clear and visible policy to guide our approach to reserves, especially as we all track worrying trends in the global economy. In line with organizations of our size (see chart below), the board adopted a resolution that guides the Foundation to have a minimum of 12 months of working capital in reserve and a target of up to 18 months. This capital can be drawn on in the event of sudden or unexpected loss of revenue.
You can read the full resolution here.