The story of the founding of the VKV by Vehbi Koç…
I owe a debt to God, to my country, to my co-operation with my dear colleagues and to my love of work for the success I have achieved in my lifetime. As the companies we had set up in the Koç Group developed, two big goals ripened in my mind. One of these was to reorganize the companies we had worked on for many years, in order to ensure their continuity and efficiency. That was why we established our holding company. My second aim was to corporatize our and donations and philanthropic services, thus ensuring that they would continue after me. This second goal was achieved when I founded the Vehbi Koç Foundation.
I signed the articles of association for the Vehbi Koç Foundation in the presence of a notary on January 17, 1969. The witnesses were Hulki Alisbah and Aydın Bolak, who had both put a lot of work into it. In this plain ceremony carried out before my family and colleagues, I donated 12 million liras worth of shares to the Foundation in the name of Koç Holding. From now on, the foundation would be able to engage in philanthropic services with its own income.
After the signing ceremony, I gave the talk below. In my talk, I tried to explain the timeline of the 18 years of work we had carried out for this purpose:
“My dear colleagues and family members,
Today is a happy day for me. In the presence of the notary Kemal Türkoğlu and witnesses, I have signed the deeds of the foundation that I have long been trying to establish. In my life from now on, I will work to ensure this foundation is well run and achieves its purposes. I expect and request of family members and colleagues who succeed me to do the same. In relation to this, I wish to mention briefly how the idea of a foundation came about and the history of the establishment of the foundation.
My father was a trustee of the İbadullah Foundation, which my ancestors founded in Ankara. I obtained the Koç family tree through the foundation files held at the General Directorate of Foundations. I have seen how many able businessmen have been raised in Turkey, how they have established big trading-houses and how after their founders’ deaths those trading-houses have quickly gone to ruin and been lost. Today you will not find a single century-old company in our country. I have seen on my travels to the great countries of Europe and America how many large establishments there are and particularly how there are thousands of charitable foundations of all sizes in America. I also learnt how Henry Ford, the founder of the Ford Company with which I have been working since 1928, established the Ford Foundation in order to keep his enterprise alive.
I explained my thoughts on establishing this type of foundation to Mr. Hulki Alisbah, who joined our enterprise in the last months of 1949. I had various conversations with the late Cafer Tüzel, who was our legal advisor at the time. Mr. Alisbah prepared the Foundation Deeds Project that you see today while on a ferry trip we took on the Black Sea in 1951, and this can be counted as the beginning of our efforts to establish a foundation.
In surrendering a significant portion of my wealth to the foundation in spite of the vagaries of this world, I also count it part of the duties of a father, thinking my family may in the future benefit from it.
However, we were all surprised by the strict rules in the civil code preventing family foundations from carrying out philanthropic works. We thought it necessary to consult the late Professor Ebülula Mardin, whom everyone knew for his knowledge and specialization in foundation affairs. The late Distinguished Professor Sıddık Sami Onar and the then-Commercial Court President, Professor Tahir Çağa, also joined him in giving advice.
After this committee investigated the legal regulations and the Deeds Project we had prepared, they confirmed the impossibility of a foundation that the family could benefit from to the degree we had expected, informing us that the only possibility was to take advantage of the minimum contribution allowed to the family under the “waged” rule. In this case, it would have meant accepting that they would be deprived of the wealth I had earnt as the result of my arduous labor to ensure their future, and I didn’t think that I had the right to do that. Or the “reserved share” would increase in proportion to the size of the foundation and this would mean that a foundation of the size we had hoped for was impossible. Meanwhile, a commission formed of Supreme Court members and professors were engaged at the Ministry of Justice to amend the Civil Code. The relevant clauses of the Civil Code referring to foundations as “trusts” (tesis) were very unclear and incomplete, so we approached both the government and the commission to alter the system in a way compatible with the charitable foundation traditions in our country that went back for centuries. I told this two or three times to the Prime Minister of the time, Adnan Menderes, and he agreed and ordered his Minister of Justice to get in contact.
These communications took such a long time that the late Cafer Tüzel and Hulki Alisbah met with two different Ministers of Justice. We explained our thoughts and we gave them the project we had prepared, but no positive outcomes arose from all our administrative and legal efforts.
I repeated my administrative attempts after the 1960 revolution. Ferit Melen, who was then the Minister of Finance, took a great interest, and ordered the Ministry of Finance Chief Legal Advisor to find a formula that would fit what was required. The Ministries of Finance and Justice wrote to one another, and yet in the end the lawyers did not reach a positive result for the Civil Code and its faltering provisions.
At that time, along with others, Aydın Bolak, a parliamentarian for Balıkesir who is now a signatory witness to the deeds, prepared a bill changing clauses of the Civil Code relating to foundations. Aydın Bolak systematically prepared for this. First of all, he consulted with Ankara University, setting up a seminar and debate at the Law Faculty for this purpose. At the seminar, everyone from professors to their youngest assistants openly debated ideas; it was indeed at this seminar that the word “foundation”, an old expression which accurately described this type of institution, replaced the word “trust” in the Civil Code.
While all these official formalities were completed, we continued our work on developing our foundation deeds. In 1966, we presented them to a large scholarly and legal group, consisting of Cevat Fehmi Başkut, Aydın Bolak, Professor Tahir Çağa, Professor Nurettin Çuhadar, Ahmed Dallı, Distinguished Professor Ekrem Şerif Egeli, Distinguished Professor Sıddık Sami Onar, Kemal Türkoğlu, Professor Süheyl Ünver and Bülent Yazıcı for investigation. On the basis of the observations of this group, we rewrote many of the provisions of the deeds. We investigated foundations such as those of Ford, Philips, Thyssen, and Rockefeller in Europe and America and we tried to advance even further based on those ideas at our meetings. After this, the bill to be presented to the Turkish Grand National Assembly (TGNA) was debated at a temporary commission. It was put on the TGNA’s agenda and accepted in the final days as the election process was finishing. Thus, the draft was prevented from becoming obsolete. Finally, the law passed through the Senate in 1967 and was published on July 24, 1967 in issue No. 903 of the Official Gazette. Despite this, the establishment of our foundation was postponed for one and a half more years. The reason for this was that the law had left many provisions on this issue to the regulations. Despite the law ordering them to be published within six months, the consultations at the Council of State still went on.
The law made it necessary for foundations to secure a cabinet decision in order to benefit from a tax exemption. In our application to benefit from this provision, which was applicable to our foundation, we first needed to wait for the regulations and later to ask for the consent of various ministries, leading it to be finished very late. Finally, on December 28, 1968 with Cabinet decision 6/11114 our foundation was granted an exemption and at last the final text that we have signed today came about. As I have shown above, the work we began in 1951 came to fruition 18 years later.
If you want to be successful at something, you must work without fear and you must never stop chasing it. That is what we did. I count it my duty in your presence to thank Aydın Bolak, who was to a large extent responsible for this law being passed. I am sure of this: that many other businessmen will establish this type of foundation and that the country will gain much from them.
To end, I would like to wish that this foundation is propitious for the Koç family and group, for the country and for its people. I know that it is my duty to express in your presence my heartfelt thanks to all of my colleagues who have carried out work for this foundation’s establishment, most of all Mr. Alisbah, who worked so long for it. I ask of God that it will enjoy good luck, and I send good wishes to all of you with love and respect. I ask that this talk be read out at the first board of directors meeting of the Vehbi Koç Foundation and that it feature in the first minutes.”
Thus, the foundation I had intended to set up for years was finally established. From the day it was set up, this foundation has given scholarships to students and has also given mass aid in education and health.
The foundation now dThe story of the founding of the VKV by Vehbi Koç…
I owe a debt to God, to my country, to my co-operation with my dear colleagues and to my love of work for the success I have achieved in my lifetime. As the companies we had set up in the Koç Group developed, two big goals ripened in my mind. One of these was to reorganize the companies we had worked on for many years, in order to ensure their continuity and efficiency. That was why we established our holding company. My second aim was to corporatize our and donations and philanthropic services, thus ensuring that they would continue after me. This second goal was achieved when I founded the Vehbi Koç Foundation.
I signed the articles of association for the Vehbi Koç Foundation in the presence of a notary on January 17, 1969. The witnesses were Hulki Alisbah and Aydın Bolak, who had both put a lot of work into it. In this plain ceremony carried out before my family and colleagues, I donated 12 million liras worth of shares to the Foundation in the name of Koç Holding. From now on, the foundation would be able to engage in philanthropic services with its own income.
After the signing ceremony, I gave the talk below. In my talk, I tried to explain the timeline of the 18 years of work we had carried out for this purpose:
“My dear colleagues and family members,
Today is a happy day for me. In the presence of the notary Kemal Türkoğlu and witnesses, I have signed the deeds of the foundation that I have long been trying to establish. In my life from now on, I will work to ensure this foundation is well run and achieves its purposes. I expect and request of family members and colleagues who succeed me to do the same. In relation to this, I wish to mention briefly how the idea of a foundation came about and the history of the establishment of the foundation.
My father was a trustee of the İbadullah Foundation, which my ancestors founded in Ankara. I obtained the Koç family tree through the foundation files held at the General Directorate of Foundations. I have seen how many able businessmen have been raised in Turkey, how they have established big trading-houses and how after their founders’ deaths those trading-houses have quickly gone to ruin and been lost. Today you will not find a single century-old company in our country. I have seen on my travels to the great countries of Europe and America how many large establishments there are and particularly how there are thousands of charitable foundations of all sizes in America. I also learnt how Henry Ford, the founder of the Ford Company with which I have been working since 1928, established the Ford Foundation in order to keep his enterprise alive.
I explained my thoughts on establishing this type of foundation to Mr. Hulki Alisbah, who joined our enterprise in the last months of 1949. I had various conversations with the late Cafer Tüzel, who was our legal advisor at the time. Mr. Alisbah prepared the Foundation Deeds Project that you see today while on a ferry trip we took on the Black Sea in 1951, and this can be counted as the beginning of our efforts to establish a foundation.
In surrendering a significant portion of my wealth to the foundation in spite of the vagaries of this world, I also count it part of the duties of a father, thinking my family may in the future benefit from it.
However, we were all surprised by the strict rules in the civil code preventing family foundations from carrying out philanthropic works. We thought it necessary to consult the late Professor Ebülula Mardin, whom everyone knew for his knowledge and specialization in foundation affairs. The late Distinguished Professor Sıddık Sami Onar and the then-Commercial Court President, Professor Tahir Çağa, also joined him in giving advice.
After this committee investigated the legal regulations and the Deeds Project we had prepared, they confirmed the impossibility of a foundation that the family could benefit from to the degree we had expected, informing us that the only possibility was to take advantage of the minimum contribution allowed to the family under the “waged” rule. In this case, it would have meant accepting that they would be deprived of the wealth I had earnt as the result of my arduous labor to ensure their future, and I didn’t think that I had the right to do that. Or the “reserved share” would increase in proportion to the size of the foundation and this would mean that a foundation of the size we had hoped for was impossible. Meanwhile, a commission formed of Supreme Court members and professors were engaged at the Ministry of Justice to amend the Civil Code. The relevant clauses of the Civil Code referring to foundations as “trusts” (tesis) were very unclear and incomplete, so we approached both the government and the commission to alter the system in a way compatible with the charitable foundation traditions in our country that went back for centuries. I told this two or three times to the Prime Minister of the time, Adnan Menderes, and he agreed and ordered his Minister of Justice to get in contact.
These communications took such a long time that the late Cafer Tüzel and Hulki Alisbah met with two different Ministers of Justice. We explained our thoughts and we gave them the project we had prepared, but no positive outcomes arose from all our administrative and legal efforts.
I repeated my administrative attempts after the 1960 revolution. Ferit Melen, who was then the Minister of Finance, took a great interest, and ordered the Ministry of Finance Chief Legal Advisor to find a formula that would fit what was required. The Ministries of Finance and Justice wrote to one another, and yet in the end the lawyers did not reach a positive result for the Civil Code and its faltering provisions.
At that time, along with others, Aydın Bolak, a parliamentarian for Balıkesir who is now a signatory witness to the deeds, prepared a bill changing clauses of the Civil Code relating to foundations. Aydın Bolak systematically prepared for this. First of all, he consulted with Ankara University, setting up a seminar and debate at the Law Faculty for this purpose. At the seminar, everyone from professors to their youngest assistants openly debated ideas; it was indeed at this seminar that the word “foundation”, an oldonates in its own name with its own revenues. When the foundation’s income is insufficient to do something, I support it. I will try to continue this work while I remain well.
Vehbi Koç, Hayat Hikâyem (My Life Story), 4th Edition, Vehbi Koç Vakfı Yayınları, Istanbul, 1983, pp. 123-26