Endowment funds as a component of the financial mechanism of global and Kazakhstani higher educational institutions

Abstract

This article reflects one of the ongoing issues experienced by higher educational institutions – the
formation of sustainable financial mechanisms to effectively influence the results of their activities as
well as to promote their strategic development, and to transition to the global market.
Along with this, insufficient funding in the Republic of Kazakhstan affects the material and technical
bases of higher educational institutions, as well as the implementation of IT innovations within them.
The formation of endowment funds could be a way to diversify educational institutions’ finance. Endowment
funds funded by donations and are used by non-profit organizations for specific purposes, usually
to fund significant educational, scientific, and community programs.
The article contains an analysis of the existing endowment funds at educational institutions of the
Republic of Kazakhstan as well as foreign models of endowment funds. The process of endowment
funds’ formation and their effectiveness indicators are considered as well. In addition, the article provides
an analysis of global practices in operations of endowment funds and their implementation to
Kazakhstani conditions. Also, recommendations on the legislative regulation of endowment funds, tax
benefits, and other preferences on building relationships with potential and future donors were provided
in this article. As a result of analysing endowment funds’ activities of the Republic of Kazakhstan, a number
of their effectivity factors were identified.
Key words: endowment funds, financial mechanism, financing of higher educational institutions,
fundraising, budgeting.