Capitalism, free trade, the social market economy, profit or non profit…… where do the Foundations of banking origins (Fob) fit in? This is the unspoken question in the minds of many, given the heterogeneous front presented by the Foundations. Well, the Foundations are private, non-profit, autonomous organisations born in the early nineties as a result of a law being passed (law no.218 of 30/07/90, a.k.a. the Amato law) which led to the privatisation of the Savings banks and of the Monte banking group. These were credit institutions with a strong sense of solidarity, many of which first came into being at the beginning of the nineteenth century during the critical phase of the passage from an agricultural to an industrial society, as a result of the local communities' need for self-government and self-preservation. The Amato law separated the banking functions from the philanthropic activities. The first to be affected were the Savings Banks and the Pledge Banks (the Monte group), already established as private, commercial, profit making institutions they were controlled by the Civil Code and answered to the same regulations governing banking and financial functions as other banks. Meanwhile, the activities focussing on social, civil and economic development remained with the Foundations (described as "of banking origins" because they were created during the reformation of the Italian banking system) which were also, initially, the major shareholders in the newly created banking institutions. The shareholdings of the majority of the Foundations have been significantly reduced through the years to the point where they are no longer the principle holders. The Foundations achieved their definitive position within the institutional and juridic profile with the Ciampi reform of 1998/1999 which recognised the private jurisdiction of the Foundations - this was then clearly established by the Constitutional Court in September 2003 (sentences 300 and 301).

There are 88 Foundations of banking origin. Differing in provenance1, size and local activity their role is that of promoting development, not only within the territories where they are based and where they have deep roots but also across the entire country. It is a role which is carried out in two ways - as institutions that provide philanthropic resources both to non profit entities and to local beneficiaries and also as important institutional investors.

Looking at their role as philanthropic institutions - charities in the English speaking world - the Foundations of banking origin are seen in Italy as a guiding force for voluntary organisations and for all of the third sector. As already mentioned, in 2003 the Constitutional Court, in the historic ruling (no.300), placed the Foundations "among the members of an organisation for social freedom". Which is to say that they are recognised as providing a valuable, hidden infrastructure both for the economy and for cultural pluralism that doesn't assign all the responsibility for the well-being of the community to Public Administration. On the contrary, in reality the Foundations confirm the principle of subsidiarity and therefore the possibility of different bodies contributing to the confrontation and resolution of problems for the public interest.

In their capacity as benefactors, every year the Foundations of banking origin give away more than a billion euro and the recipients of the grants provided by the Foundations are always those who have non-lucrative objectives and are always working towards the public interest - private non-profit organizations or public institutions. The Foundations cannot make donations to private citizens who are engaged in profit making enterprises. The resources used for these philanthropic grants come from income generated by capital investments. Only a part of these investments are in banking activities. The rest are used for capital management and in medium to fixed assets which are being made more and more within the sectors which are already receiving donations, thus substantially increasing the resources available. We are referring here to funds destined not only for social housing, for small and medium sized businesses, for technological research or for other infrastructures but also for companies operating in strategic areas such as municipal sectors, motorways, airports and, last but not least, the CDP (Cash Deposits and Loans), crucial for land development and the revitalisation of the country.

In order to give shape to the excellent practices, already tried and tested, and to fulfil the spirit of the laws that govern them as well as reinforcing the affirmation of their disinterestedness and impartiality with respect to politics, in April 2012 the Foundations created a type of Ethical Code of reference, voluntary but binding, the Charter of the Foundations. This Charter will allow them to make decisions in the fields of governance and accountability, of institutional investment and of capital management that are consistent with their shared values.

1 When we look at the history of the original Savings banks we see that some had institutional origins (founded by local community entities) while others had associative origins (born as anonymous societies with capital contributed by private citizens). Therefore, we now have institutional Foundations and associated Foundations. The only difference between the two is that the last mentioned still hold assemblies of the original associates. The governing organs for both are the Board of Directors; Administration and Control.