## **MARINE STEWARDSHIP COUNCIL**
**(A company limited by guarantee)**
**TRUSTEES’ REPORT AND CONSOLIDATED ACCOUNTS FOR THE YEAR ENDED 31[ST] MARCH 2023**
**Registered Charity No: 1066806 Registered Company: 3322023 Registered Office: Marine House 1-3 Snow Hill London EC1A 2DH**
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## **CONTENTS**
||**Page**|
|---|---|
|Trustees’ Report and Strategic report:||
|•Structure, governance, and management|3 to 8|
|•Objectives and activities|8 to 9|
|•Strategic report:|9 to 16|
|Achievements and Performance||
|Financial review and results for the year||
|Risk Management||
|Reserves Policy||
|Investment Policy||
|Plans for Future Periods||
|•Reference and Administration|17|
|•Trustees Responsibilities|18|
|Independent auditor’s report|19 to 21|
|Consolidated statement of financial activities|22|
|Charity statement of financial activities|23|
|Consolidated and charity balance sheet|24|
|Consolidated cash flow statement|25|
|Notes to the financial statements|26 to 41|
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## **TRUSTEES’ REPORT AND STRATEGIC REPORT**
The Trustees of The Marine Stewardship Council (MSC) present their Annual Report for the year ended 31 March 2023 under the Charities Act 2011 and the Companies Act 2006, including the Directors’ Report and the Strategic Report under the 2006 Act, together with the audited financial statements for the year.
## **STRUCTURE, GOVERNANCE AND MANAGEMENT**
## **INTRODUCTION**
The (MSC) is a company limited by guarantee (company number 3322023) and is registered as a charity with the Charity Commission (number 1066806). The Charity is constituted through a Memorandum and Articles of Association dated 17 February 1997, as amended.
The overall objectives of the MSC as set out in the Memorandum are “to conserve the marine and freshwater environments for the benefit of the public and to advance public education in the principles and practices of conservation, particularly, but not exclusively by:
- conserving marine and freshwater fish populations and the environment on which they depend
- promoting, for the public benefit, effective management of fisheries and ensuring the sustainability of global fish stocks and the health of aquatic ecosystems generally
- establishing and promoting the application of a broad set of principles, standards and criteria for sustainable fishing”.
The MSC’s mission is to use its fishery certification program and eco-label to contribute to the health of the world’s oceans by recognising and rewarding sustainable fishing practices, influencing the choices people make when buying seafood and working with a range of partners to transform the seafood market to a sustainable basis.
The Trustees have prepared this report in accordance with Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), the Companies Act and the Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard in the UK and Republic of Ireland (FRS 102) – effective 1st January 2019.
## **THE TRUSTEES’ MANAGEMENT AND STRUCTURE**
The MSC is governed by a Board of up to fifteen Trustees, elected by the Board, taking into account a balance amongst interested groups: fishing companies, processors and retailers, NGOs and marine (fisheries) scientists, and the need for suitable geographical representation (MSC is a global organisation). Two seats each are set aside for representatives of the fishing industry (harvesting and processing), commercial sector, and the conservation sector, as well as two seats for marine scientists. The remaining seven seats are not allocated to specific interest groups. The Articles of Association provide for ex officio positions on the Board for each of the co-chairs of the Stakeholder Advisory Council, the chair of the Technical Advisory Board, and the chair of the MSCI (see below for descriptions of these bodies). A Board Code of Conduct and Conflict and Declaration of Interest Policy is in place.
The Board and Executive receive advice from two advisory bodies that are an integral part of the MSC's governance structure. The Technical Advisory Board is made up of scientists and technical experts and provides the Board and Executive with advice on setting,
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reviewing and implementing the organisation’s standards for sustainable fisheries and chain of custody and related issues. The Stakeholder Advisory Council comprises up to 17 members including representatives from the seafood industry, conservation community, market sector and academia. It provides advice to the Executive and the Board and input into the MSC’s review processes, ensuring these are representative of a wide range of views and opinions.
Many Trustees are involved in the specialist aspects of the MSC's program and work. The Board delegates some of its work to standing committees and ad hoc work groups. The Finance Committee oversees MSC’s financial operations, examining periodic management accounts and recommending the annual budget to the Board; it also reviews the MSC’s investments and certain fundraising activities. The Development Committee’s focus is to help shape fundraising strategy and identify fundraising opportunities. A Governance Committee has been established to provide advice to the MSC Board regarding governance arrangements for the Board of Trustees, Technical Advisory Board and Stakeholder Advisory Council and MSC’s subsidiary companies. The Audit & Risk Committee is responsible to the MSC Board for ensuring that the MSC has in place a robust framework for financial accountability and financial control, suitably qualified external auditors, and an adequate and effective corporate risk management and assurance framework, and also that MSC is compliant with relevant financial and audit regulations. It also fulfils this function for MSC’s subsidiary boards.
The range of these committees provides for robust governance and is vital to the complex and sensitive work of the organisation.
The Board seeks new Trustees through a transparent external recruitment process as vacancies arise, through open, public advertisement and formal interview of shortlisted candidates. The Governance Committee of the Board scrutinises the applications (i.e. CV and covering letter) and the outcomes of the candidates’ interviews, before making a recommendation to the Board.
Upon appointment, Trustees receive a Trustees’ Induction pack, including documents such as the latest published financial statements, the Memorandum Articles and of Association, an explanation of Trustees’ roles and responsibilities, the Charity Commission’s guidance on public benefit and fiduciary duty etc. The Board of Trustees also adopted a Code of Conduct for all members of the Board in 2017.
MSC wholly owns a subsidiary company, Marine Stewardship Council International Limited (MSCI), which carries out its trading activities, most notably those related to logo licensing. MSC wholly owns a further three subsidiaries (MSC Ltd, MSC Asia Ltd, MSC Asia Pacific Pty) the activities of which help fulfil MSC’s charitable mission in the Americas, South East Asia and Australia, New Zealand and the wider Pacific. MSCI also has a Chinese registered subsidiary, An Hai Xu Fishery Certification Consulting (Beijing) Ltd Co (known as MSC China), the activities of which help fulfil MSC’s charitable mission in China. In 2020, MSC established a non-profit General incorporated association (GIA), Ippan Shadan Hojin MSC Japan, to support its charitable mission in Japan.
The day-to-day operational management of the MSC is delegated by the Board to the Chief Executive Officer (CEO) and the senior executive team (collectively comprising the Executive Committee). The key management team is considered to be the Executive Committee which consists of the CEO, Chief Science & Standards Officer, Chief Operating Officer, Chief Program Officer, and Chief Communications Officer.
The remuneration of the CEO is set jointly by the Chair of the Board and the Chair of the Finance Committee, referencing appropriate market data. The remuneration of the rest of
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the Executive Committee is set by the CEO in consultation with the Board Executive Committee, based upon independent market data provided by a third-party consultancy.
## **THE CHARITY CODE OF GOVERNANCE**
The MSC takes its governance responsibilities seriously and, as an international charity, aims to have a governance framework that is fit for purpose, compliant and efficient. In 2017 the new Charity Code of Governance was launched and updated in 2020, with a recommendation that charities review their level of application and to explain any aspects of the code they were not applying. In our review, MSC carried out a detailed examination of each element of the updated Code:
- Organisational purpose
- Leadership
- Integrity
- Decision making, risk and control
- Board effectiveness
- Equality, diversity and inclusion
- Openness and accountability
This review found that MSC applies the Code in all material aspects. Further, in order to build on its compliance with the Code and maintain governance best practice, over the current year, the Board has implemented range of governance evolutions. A key element of this best practice progression is a review and update of the Charity’s Articles of Association, which is currently close to completion.
The principles of equality, diversity and inclusion are embedded within the MSC and its work, through the leadership of the Board. The Trustees particularly recognise the importance and value of a diverse Board, taking account of this in their Board succession planning and recruitment processes. To this end, a number of newly appointed Trustees will join the Board from July 2023. The new Trustees bring wide-ranging, relevant experience to the MSC and come from diverse backgrounds: these appointments will serve to enrich the diversity of the composition of the Board of Trustees.
## **BOARD OF TRUSTEE DUTIES UNDER SECTION 172 OF THE UK COMPANIES ACT**
## **DUTIES & RESPONSIBILITIES**
The responsibilities of the Board of Trustees under section 172 are summarised as follows:
A director of a company must act in the way they consider, in good faith, would be most likely to promote the success of the company and have regard (amongst other matters) to:
- a) the likely consequences of any decision in the long term
- b) the interests of the company’s employees
- c) the need to foster the company’s relationships with stakeholders and suppliers,
- d) the impact of the company’s operations on the environment
- e) desirability of the company maintaining a high reputation for high standards of business conduct.
On joining the MSC Board, all new Trustees are briefed on their duties, and Trustees also receive relevant training and information throughout the period of their term of appointment.
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It is important to recognise that the Trustees partly fulfil their duties through a governance framework (including a formal Scheme of Delegated Authorities) that delegates day to day decision-making to the Executive Committee of the Charity. Details of our governance arrangements are outlined in the Trustees Management and Structure on page 3.
The MSC Trustees consider that they have fulfilled their obligations under section 172. The following summarises how this has been achieved.
## **RISK MANAGEMENT**
We operate in an uncertain and challenging environment, from which emerge a range of risks, many of which are beyond our direct control. It is therefore vital that we effectively identify, evaluate, manage and mitigate the risks we face.
The Board has set in place a robust risk management framework, enabling it to assess and manage both its risk appetite and our current risks and their mitigation. The Audit & Risk Committee is responsible to the MSC Board for ensuring that the MSC has in place an adequate and effective corporate risk management and assurance framework.
For details of our principal risks and uncertainties, see the Risk section of the Finance Report on page 14.
## **STATEMENT OF ENGAGEMENT WITH OUR EMPLOYEES**
As a ‘knowledge-based’ organisation, our employees and our ‘Better Together’ culture are critical to the success of the MSC. With this in mind, development and investment in our people is integral to our charity.
Key people initiatives we have set in place, and continue to progress include:
- biannual survey of all employees (reported to the Board), which consistently engenders almost universal participation, with the results demonstrating the continual highly positive engagement of our staff
- development and delivery of a Learning & Development Strategy
- robust staff performance management systems
- development and delivery of a diversity, equity and inclusion action plan
- policies and procedures to support the full HR lifecycle of our employees
- policies, tools and systems to enable staff to fulfil their roles, to ensure their health and safety, and to support their well-being.
## **STATEMENT OF MSC’S RELATIONSHIPS WITH STAKEHOLDERS & SUPPLIERS**
Independence, transparency, impartiality and multi-stakeholder governance are central to the MSC’s values and commitment to maintain and strengthen world-leading standards.
We work hard to ensure our standards, strategy and decision-making take account of the views, expertise and experience of a wide range of perspectives, from academia and government, the fishery and market sectors, and the environmental NGO community.
Our governance structure therefore involves a wide range of individuals with different perspectives to ensure that the MSC’s decisions are balanced, reflecting many sectors and interests. Stakeholders are included in the membership of the MSC Board itself, the Technical Advisory Board, and Stakeholder Advisory Council (STAC). Indeed, the STAC was specifically established to provide advice and stakeholder perspectives to the Board and
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Executive. Its membership includes representatives from the seafood industry, conservation community, market sector and academia, and reflects the diverse expertise, experiences, geographies and interests in relation to the work of the MSC.
In addition to our governance bodies, other stakeholder engagement initiatives and activities include:
- stakeholders are invited to participate in consultations on our standards and requirements
- the fisheries certification process encompasses formal opportunities in which stakeholders are encouraged to participate in the third-party assessment of a fishery against MSC Fisheries Standard
- day to day informal, regular interaction with stakeholders across all sectors.
We also value all our suppliers (all of whom are selected through robust procurement processes) and the contributions that they make to our organisation. Our effective working relationships with our suppliers served us very well during the COVID-19 pandemic, particularly that with our outsourced IT partner, which worked closely with us to ensure we were able to continue to operate fully and maintain organisational cohesiveness throughout extended lockdowns across the world.
## **MSC’S ENVIRONMENTAL PERFORMANCE**
The following table sets out MSC’s GHGe (Green House Gas emissions). 2022/23 is considered as MSC’s “base” year for GHGe reporting.
||**2022/23**|
|---|---|
|Energy use (kWh hrs)|131,847|
|Associated greenhouse gas emissions (tonnes C02 equivalent) (TCO2e)|67|
|Intensity ratio (TCO2e/number employees)|0.27|
C02 emissions arising from work travel (including commuting to the office) are estimated to be 788 TCO2e. As an international organisation, overseas travel is an inherent feature of our day-to-day operations for many staff, but we seek always to ensure we only undertake necessary journeys, and to do so in a way which minimises our carbon emissions. MSC will investigate options to offset the emissions made.
We have also introduced a number of energy-saving initiatives designed to minimise our energy consumption and environmental impact, an important consideration for an environmental organisation such as MSC. These include:
- 100% certified green energy in our UK headquarters, and all other offices globally where this is possible, using an energy broker to generate efficiencies and cost savings
- encouraging employees to use public transport where they need to travel for meetings, and to consider video-conferencing as an effective alternative to travel
- recycling arrangements available in all offices
- installation of energy efficient elements for refurbishment and replacement projects
- • introduction of light sensors in many of the communal areas of our headquarters office, and encouragement of efficient use of electricity and water by all staff
- encouragement and support for internal greening initiatives instigated by our employees.
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## **MAINTAINING A REPUTATION FOR HIGH STANDARDS**
As an organisation, we operate within a robust governance framework which underpins and enables all aspects of our decision making. Further details on this can be found on page 3.
MSC’s Fisheries Standard is compliant with the highest globally recognised standards laid down by bodies such as the UN’s Food and Agriculture Organisation (FAO), the Global Sustainable Seafood Initiative (GSSI) and ISEAL, the international body for credible standard setters. Indeed, the MSC is the only global wild-capture fisheries certification program that simultaneously meets best practice requirements set by the UN FAO and has been independently evaluated against ISEAL’s Codes of Good Practice.
In order to ensure the highest standards and the credibility of our third-third party certification program, the MSC has set in place a robust assurance system:
- fishery assessments are carried out by independent accredited conformity assessment bodies (CABs) with teams of experts in fisheries science and management who are independent of the fishery and the MSC, and the process also includes an independent peer review to check the expert judgement within fishery assessments
- assessment reports are transparent and are published on our Track a Fishery website
- a similar independent, third-party approach is also used for our chain of custody certification program
- as an additional safeguard, MSC has appointed Assurance Services International (ASI) as an external oversight body for CABs
- we also ensure assessors follow ISO17065, an international Standard used in many sectors including food safety, to ensure that assessment teams operate in a competent, consistent and impartial manner
- and we provide mandatory online training and relevant qualification requirements for assessors.
Most importantly, the MSC receives no money for fishery or chain of custody assessments or certifications.
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## **OBJECTIVES AND ACTIVITIES**
## **PUBLIC BENEFIT**
The MSC is an international organisation which partners with the environmental, science and funder communities and the seafood industry to pursue an overall charitable purpose of the advancement of environmental improvement, using its fishery certification and eco-labelling program. It does so by recognising and rewarding sustainable fishing practices, influencing the choices people make when buying seafood and working with partners to help to transform the seafood market to a sustainable basis. The MSC believes its work delivers positive environmental impacts for the marine environment, which in turn provides a significant benefit to the public and to the local communities that depend on fishing.
The application of the MSC’s certification program and eco-label empowers seafood buyers, both major retailer buyers and individual consumers, to make better and more informed choices when buying seafood. The effect is one that rewards in the marketplace those fisheries that follow responsible practices. In turn, this creates the incentives for fisheries around the world to meet the MSC's standard for environmentally responsible and sustainable fishing. In doing so they will have to demonstrate to third party certifiers that they are operating in a way that helps to ensure the long-term sustainability of the fish stocks they are targeting, and that they respect the ecosystems in which they operate. As the reach of the MSC’s program expands globally, the public will, increasingly, be able to identify the best environmental choice in seafood and will be more empowered to play their role in creating a sustainable marine environment. With the marine environment under considerable threat, particularly in the face of climate change, all those that value and derive benefit from the oceans and marine resources stand to benefit from the work of the MSC.
Community groups and other sub-sets of the public that are dependent on the long-term resilience of fisheries and the resulting creation of sustainable livelihoods, in particular, stand to benefit from the realisation of the MSC’s aims through increased economic development, food security and resilience in the face of climate change.
The Trustees confirm that they have complied with their duty in Section 17 of the Charities Act 2011 to have due regard to the public benefit guidance published by the Charity Commission of England and Wales. The Trustees further confirm that the activities of the Charity are carried out, in line with its objects, for the public benefit as described above.
## **STRATEGIC REPORT**
## **ACHIEVEMENT AND PERFORMANCE**
The expenditure for charitable activities during the current year can be viewed in Note 5 of the accounts, where the charitable activities are grouped together under four activity headings: development of policy and the maintenance of the standards, education and raising awareness of the issue of over fishing and MSC’s role as one of the potential solutions, servicing fisheries and commercial partners that are already engaged in the program as well as outreach to potential new partners in developing regions and beyond, and logo licensing, which increases the transparency in the supply chain allowing consumers to choose seafood caught sustainably and so incentivise sustainability.
The MSC’s charitable funding has faced difficult challenges in the past several years due to the twin shocks of the COVID-19 pandemic and the ongoing war in Ukraine. While the effects of the pandemic have gradually lessened, the war in Ukraine continued to impact
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supply chains sourcing Russian-caught fish directly in this fiscal year and in addition, the conflict contributed inflationary strains to the fishing and consumer retail industries. It is likely that the war in the Ukraine will continue into the next fiscal year, and is the situation is as yet still too unpredictable to know with certainty what the effects of war in Ukraine will be ultimately on the MSC program.
Despite these challenges, we continue to place particular emphasis on maintaining our strong outreach with retailers and consumers and increasing our engagement with governments and non-government organisations around key areas for change. The MSC’s certification program and eco-label have make it easier for major seafood buyers and consumers to choose certified sustainable seafood, providing both a reward and an incentive for fishers to fish sustainably—our theory of change. With our many partners, the MSC continues to pursue the goal of healthy oceans and sustainable seafood markets globally.
Over the last financial year, we are pleased to report that the number of units of certification rose by almost 7% from 950 to 1018, while the total number of fisheries engaged in the program (i.e. certified or in assessment) fell to 1,046 from 1,067 (i.e. an additional 28 were in full assessment this year versus 117 last year). A growing global market for MSC-certified seafood is demonstrably rewarding environmentally responsible fisheries and providing incentives for more to join the program and make changes in their practices where necessary. At the end of the year 20,780 MSC labelled products (consumer facing) were actively on sale in over 100 countries, compared with 20,544 active products in 2021/22, an increase of 1.15%.
Other relevant indicators of the MSC’s impact and growth include:
- Over 17% of global wild caught seafood now comes from fisheries certified under the MSC Fisheries Standard (with over 19% of all wild marine catch was engaged with the MSC): global collaboration has doubled sustainable MSC catch and more than tripled chain of custody commitment since 2010.
- Our presence in developing economies to see strong growth: There are now 126 MSC units of certification in developing economies (up from108 in 2021/22, 73 in 2020/21 and 66 in 2019/20), with a further 19 in assessment.
- The quantity of sold MSC labelled seafood (by product weight), has globally increased to over 1.21 million MT. Globally, stocks targeted by MSC certified fisheries continue to show sustainable levels of stock biomass and in many regions, stocks show higher biomass after MSC certification occurred.
- And in the supply chain, DNA testing results continue to show levels of mislabelling of <1% for MSC certified products.
## **Chain of Custody Standard**
The MSC Chain of Custody (CoC) program grew again in 2022/23, albeit at a slower pace than in previous years, with the number of certificate holders rising to 5,665, up from 5,437 in 2020/21, 5,170 in 2019/20 and 4,729 in 2018/19 (and note that the baseline in 2010 was 1,099 in 2010). China overtook the United States in 2019/20 for the first time and it continued in 2022/23 to have the most certificate holders despite the COVID-19 pandemic, with the US still in second place and France now in third, replacing Germany.
As in 2021/22, the majority of certificates are still held in Europe, but with notable growth in Asia Pacific, particularly China as noted, and in the category the “rest of the world,” which captures CoC mainly in developing economies. In 2023, MSC will celebrate the 10th anniversary of its opening an office in China and during this time, the number of MSC labelled products in the country has increased from 10 to more than 200. The MSC has also
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seen considerable growth in the number of Chinese supply chain companies, retailers and fisheries engaging in the MSC program.
The MSC’s current CoC Standard is widely considered best in class, and our vision is to ensure that the MSC’s CoC system has improved accessibility and efficiency of engagement for all levels of the supply chain which continues to ensure that key risks such as product substitution are controlled, monitored and minimised.
## **Fishery Standard**
As of 31 March 2023, 1044 units of certification in 36 countries had been certified as sustainable to the MSC Fisheries Standard (up from 950 in 2021/22), demonstrating their commitment to healthy ecosystems and the long-term sustainability of fish stocks. Another 28 units were in assessment. Some 2,000 sustainability improvements were made by MSC fisheries in 2022/23 with over 95% of MSC certified fisheries having made improvements in fishing practices.
In addition, hundreds of fisheries around the world are engaged in Fishery Improvement Projects (FIPs), including MSC’s own Pathway to Sustainability projects and In-Transition to MSC (ITM) program. MSC’s Pathways projects help to move fisheries along the path towards greater sustainability and ultimately, where possible, certification as part of our commitment to work with small scale and/or fisheries in developing economies (see below under Ocean Stewardship Fund).
Every five years the MSC initiates a Fisheries Standard Review (FSR). The FSR is an opportunity to consider potential improvements to the Fisheries Standard by reviewing issues raised by stakeholders and by our own monitoring and evaluation processes, and where appropriate, to incorporate widely accepted new science or fisheries management best practice.
The latest version of our Standard (version 3.0) was published in October 2022, following the most comprehensive Review to date. The Fisheries Standard 3.0contains significant improvements to help address some of the most difficult issues facing the oceans, including better protections for marine biodiversity and incentivising stronger ocean governance. We have also clarified language, refined existing tools and developed new guidance to ensure our Standard can be applied efficiently and is increasingly accessible to all fisheries.
## Specifically, the latest review FSR worked to:
- incorporate improved and generally accepted global scientific understanding and fishery management practice into the Fisheries Standard
- enhance program credibility and legitimacy by reviewing issues identified in previous versions of the Standard or fisheries assessment process
- improve fisheries data collection to enable rigorous monitoring and evaluation
- increase standard applicability and accessibility for fisheries from emerging economies
- reduce Standard complexity to reduce barriers for new fisheries.
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## **Growth of the MSC’s Ocean Stewardship Fund**
The MSC Ocean Stewardship Fund (OSF) aims to increase the proportion of global fisheries operating in a sustainable way by providing financial support in the form of grants or other financial instruments to both certified fisheries and for fisheries in MSC’s ITM program. The OSF was first announced in November 2018, along with a £1 million seed fund allocated from MSC’s unrestricted reserves to help kickstart the Fund. The Board of Trustees then formally approved the OSF on 30 July 2019 and agreed to designate 5% of MSC’s annual volume royalties to the OSF for the foreseeable future.
As of 31 March 2023, OSF has secured a total of £7,727,970 in income, from a mix of MSC royalty contributions and third-party philanthropic funding. Some £2,041,395 of this funding was received in 2022/23. Since 2019/20, the OSF has awarded 107 grants totalling almost £4 million across 30 countries, 40 of which have supported fisheries and projects in developing economies. The 44 grants approved by MSC in 2022/23 totalled approximately £1,723,000.
As part of the support received in 2022/23, the OSF continued to expand with an unrestricted donation of €1 million in June 2022 from the Hans Wilsdorf Foundation, which will enable OSF to fund a broad range of projects that are of strategic importance to MSC’s vision and mission as a whole. Work has now begun on developing the criteria and processes that will be used to award this unrestricted funding.
In addition, funding provided by the MAVA Foundation amounting to a total of €750,000 (£639,443) was granted out in this past fiscal year. All funds from this grant were awarded to fishery improvement projects in the Mediterranean and West Africa by the end of the MAVA grant (31 October 2022). Additional support of US$1,000,000 (£750,589) was donated by the Walton Family Foundation to provide a Loan Guarantee Facility (LGF) for selected fisheries.
Finally, in addition to supporting fisheries directly with certification, the OSF also started to fund larger MSC-led projects in 2022/23 in areas such as climate change and MSC Pathway Projects.
## **CHARITABLE FUNDRAISING**
The MSC employs an international fundraising staff of five full time employees who are tasked with delivering MSC’s fundraising plan as articulated by the Board and senior management and managing the Ocean Stewardship Fund (OSF); the MSC is registered with the UK Fundraising Regulator and voluntarily observes the UK Charity Commission’s Code of best practices. This includes complying with any relevant statutory accounting and reporting requirements on fundraising. Fundraising staff at the MSC are overseen and monitored by both senior management and the Development Committee of the Board of Trustees. The MSC worked with the Swiss-based independent investment advisory company Clarmondial around fundraising for the OSF in 2022/23 as part of a grant from the MAVA Foundation pour la Nature,but does not otherwise employ outside fundraising consultants or similar commercial services, nor did the MSC receive any complaints around fundraising, or the staff engaged in fundraising in 2022/23.
The MSC undertook no active fundraising from the general public requiring disclosure under S162A of the Charities Act 2011 in the past financial year (2022/2023) and had no campaigns or other active attempts to fundraise from the general public. The majority of MSC’s charitable income continues to come from institutional sources (foundations/trusts and government bodies) that are not domiciled in the United Kingdom (see below). While the
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MSC does not in the main fundraise from individuals, the organisation is in full compliance with the General Data Protection Regulation (GDPR) rules in respect of personal data.
## **Support from Funders**
The MSC is very grateful for our many charitable donors across the globe for the support they have given us this past year and since our founding. This year the MSC received significant new and generous support from both the Hans Wilsdorf Foundation, Walton Foundation, and the MAVA Foundation for our Ocean Stewardship Fund, and from the MAVA Foundation specifically for our work both in the Mediterranean, western Africa and around enabling financing for fishery improvements. In addition, the MSC continued to receive generous core support from the Dutch Postcode Lottery and Holzer Family Foundation, as well as continued support from the Adessium Foundation and Leventis Foundations for our work in the Mediterranean and the Remmer Family Foundation for our work in southern Africa. We would also like to thank the Triad Foundation for their generous support of our Pathway project in Canada.
## **FINANCIAL REVIEW AND RESULTS FOR THE YEAR**
Total group income in 2022/23 was £32.73 million compared to £29.79 million in the previous year. Income from charitable activities (that is, largely logo licensing royalty and annual fee revenue) amounted to 89% of total income (2021/22 88%).
Income from donations and legacies was £2.27 million in 2022/23, down 5% from the £2.41 million received in 2021/22. Note 2 to the accounts shows a further breakdown of voluntary income.
Income from charitable activities, consisting largely of royalty income and annual fees, increased overall by 11.2% from £26.13 million in 2021/22 to £29.05 million in 2022/23. Annual fees increased by 4% to £2.16 million (2021/22 £2.07 million). Volume royalty increased by 11.9% to £26.61 million (2021/22 £23.77 million).
Income from investments of £0.79 million increased compared to the previous year (2021/22 £0.74 million). The net losses on the investment portfolio (that is, the reduction in market valuation of the investments at the year-end) amounting to £0.77 million (2021/22 gain £0.95 million) are excluded from investment income and are disclosed separately on the Statement of Financial Activities as “Gains / (Losses) on revaluation of fixed asset investments”.
Expenditure totalled £30.57 million in 2022/23, up 6.6% from £28.67 million in 2021/22.
Staff costs increased by 4% to £15.65 million from £15.03 million. The average number of employees in the year decreased to 247 in 2022/23 (2021/22 251).
Expenditure on raising funds for the MSC’s fundraising activities increased by 19% to £0.74 million (2021/22 £0.62 million).
Note 5 to these accounts provides a breakdown of costs incurred in furtherance of the Charity’s objectives and shows a year-on-year increase in spend on the MSC’s charitable activities of 6% to £29.82 million (2021/22 £28.05 million).
Governance costs increased by 8% to £0.76 million (2021/22 £0.7 million) as the Board and other governance committees increased travel to meet in person after the global relaxation
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of pandemic lockdown restrictions. These costs also include the audit fee, the cost of holding Board meetings as well as other Board relevant costs and an allocation of relevant staff salary costs. Governance costs are only 2.3% of total MSC income, welcomely low for an organisation which is very complex and has a truly global reach.
Gains upon revaluation of foreign assets amounted to £0.02 million (2021/22 loss £0.15 million). This gain or loss arises from the revaluation of the net assets held by the MSC’s overseas subsidiaries.
The MSC ended the year in a sound financial position.
The overall surplus for the year of £1.41 million increased total reserves going forward to £42.13 million. £2.51 million of this carry forward reserve are restricted funds, £1.86 million are funds designated to OSF activities and £37.76 million unrestricted. The surplus in the year on unrestricted reserves was £1.43 million.
Cash balances (including cash investments of £3.9 million) totalled £10.38 million (2021/22 £10.4 million).
## **RISK MANAGEMENT**
The Trustees address from time to time the risks that face the Company and adopt responses to minimise the risks identified.
The major risks identified are:
- Global biological change (climate change) undermines the productivity and resilience of marine ecosystems, and the enabling environment for fisheries to be managed sustainably, increasing the risk of fisheries’ suspension from the MSC program. This can be partially mitigated by ensuring the Fisheries Standard evolves to reflect global climate change.
- Vulnerability of the MSC’s program to external events beyond its control (such as a failure of Regional Fisheries Management Organisations (RFMOs) to reach agreement on harvest control rules leading to fishery suspensions and withdrawals) reducing MSC’s ability to drive change on the water. This can be partially mitigated by the maintenance of a “heatmap” to give early anticipation and identification of fishery suspension risk, the implementation of an RFMO strategy and continued outreach effort.
- Global political change (for example, the conflict in Ukraine) and increased nationalism / trade wars presents limitations to the ability of the MSC program to scale. This can be partially mitigated by continued, systematic engagement with governments (EU / US / Asia).
The Trustees review the risks regularly, and they believe that there are adequate systems in place to minimise them.
The impact of Brexit continues to be a risk, with ongoing uncertainty over the changing distribution patterns of raw material inputs into UK and European supply chains. A global perspective of the MSC highlights that much larger volumes of MSC certified fish supplies come from outside Brexit affected geographies, thus mitigating the potential downside impact of Brexit on MSC royalty income. The conclusion is that Brexit is unlikely to become an existential crisis.
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The war in Ukraine presents potential risks to the MSC caused by disruption to global supply chains and impacts on financial markets. MSC continues to monitor the situation and engage actively with supply chain partners.
## **RESERVES POLICY**
The Trustees believe that it is generally good practice to hold reserves to protect against funding and other financial difficulties.
The MSC raises the majority of its voluntary income from a relatively small number of supportive trusts and foundations and consequently the financial impact should a donor decide to phase out its support would be material. The MSC is striving to diversify its charitable donor base. As a result, more speculative income and more restricted income may be included in the MSC’s budgets. Holding reserves ensures confidence that such target income can be given time to be nurtured without detrimentally effecting the MSC’s operations.
Certified fish entering the supply chain is the fuel that facilitates the generation of ecolabel royalty income for the MSC, via its trading subsidiary MSCI. While royalty income is therefore diversified across many certified fisheries, MSC certification can be lost or withdrawn. Similarly, royalty income is dependent upon the use of the MSC’s ecolabel on a pack, which is an entirely voluntary decision made by the brand owner, not the MSC. Should royalty income unexpectedly decline, it may be necessary to realign expenditure to income. Reserves are therefore held to allow time for this realignment to take place and to cover the costs of such a fundamental restructuring in the event of a major downturn.
The reserves also cover the exchange rate risk implicit in the MSC’s income and expenditure patterns, as well as the risk of losses arising from liquidating fund investments that form a major part of the MSC’s unrestricted reserves, in the unlikely circumstance that these investments are needed to fund day to day operational expenditure. Finally, the MSC’s short term cash flow requirements (i.e., its “working capital”) are also covered by reserves.
The Board has quantified the makeup of reserves against each of the above-named risks and concluded, in total, the unrestricted “free” reserve should be set between a minimum of 9 months and a maximum of 12 months of the following year’s budgeted expenditure.
Should the maximum reserves ceiling be habitually exceeded (defined as being two continuous years in succession), the Board will consider strategically whether the MSC’s capacity to generate royalty revenue remains appropriate and in line with its current and predicted expenditure requirements, or whether the success of the MSC licensing program has resulted in royalty income being generated at rates in excess of the organisation’s ability to spend it over the longer term.
Alongside any such strategic consideration, within a financial year that any breach in the maximum reserves ceiling is identified, the Board will give consideration to investing all the surplus free reserves, or an appropriate proportion, in the following areas:
- a) Ocean Stewardship Fund: Transition Assistance strand – with the objective of enabling prospect fishery partners to overcome generic obstacles to achieve certification.
- b) Ocean Stewardship Fund: Science & Research strand with the objective of commissioning additional scientific research that would benefit multiple fisheries which could enable existing certified fisheries to maintain their certifications.
- c) Marketing – magnifying the impact of already planned marketing activities.
15
- d) Any capital project which the Board deems appropriate for the furtherance of the MSC’s mission and charitable objects.
This reserves policy was adopted by the Board of Trustees in June 2019 and its appropriateness is continually monitored.
The MSC ended the year with unrestricted reserves of £37.8 million (see note 20). Once intangible assets and tangible fixed assets of £4.8 million (see notes 10 and 11), free reserves amounted to £33.0 million (2021/22 £31.2 million). This equates to 12.75 months of the Board approved unrestricted expenditure budget for 2023/24 (£31.05 million), up from 12.3 months reported for the previous year.
## **INVESTMENT POLICY**
The general objective of holding investments is so the MSC’s reserves generate a return that would be greater than the return that could be obtained if the reserves were held as interest bearing cash deposits.
Fixed asset investments are held in investment funds managed by Northern Trust and UBS. The intention is for these investments to be held long term, within a balanced and diversified portfolio, and that the MSC will not need to liquidate the investment in the foreseeable future. Both investment managers have delegated authority to make investment decisions, within a framework of pre-defined portfolio parameters, in response to market movements.
The Northern Trust portfolio covers equities, fixed income securities, real estate, and commodities. The equity element (the majority of the investment) is invested in Socially Responsible Investment (SRI) funds. The SRI funds mirror Morgan Stanley Capital International Ethical, Social and Governance indexes (namely the MSCI World ESG index and the MSCI US IMI index) to guide investment opportunities in equities screened for ESG criteria.
The investment fund managed by UBS consists of a mix of fixed income securities and equities, weighted towards equities. UBS use third party rating providers MSCI Research, Inrate or Oekom to allocate to each holding an ESG score and to provide MSC with a portfolio with an overall sustainability profile.
Current asset investments are all held as cash deposits.
## **PLANS FOR FUTURE PERIODS**
2022 marked the 25[th] anniversary of the establishment of the MSC. Having reached this milestone, our goal of sustainable fisheries supporting healthy and productive ocean ecosystems remains unchanged, and we believe that our existing goal of engaging over a third of global landings in the MSC program by 2030, is not only achievable, but essential. Achievement of this ambitious goal through the engagement and leadership of our partners will make a significant contribution to the delivery of the United Nations Sustainable Development Goal 14 targets.
In 2022, we developed our fourth Integrated Strategic Plan, which will guide the organisation’s priorities and activities from 2023 to 2030 towards the achievement of our 2030 goal. Under this Plan, the MSC will continue to maintain world-leading Standards for sustainable fishing while expanding market opportunities that incentivise more sustainable fishing globally. This new strategy will see an increased focus on research efforts which support MSC certified fisheries and those on their journey to sustainability.
16
To help fisheries fund their continuous improvement, the MSC is expanding its Ocean Stewardship Fund while also opening up its In-Transition to MSC (ITM) program to all fisheries. In addition, we are accelerating progress and increasing the number of sustainable fisheries worldwide by funding innovative research and supporting fisheries at all stages on the path to sustainability.
In order to enable this, the MSC has set an ambitious goal to mobilise US$100 million to help safeguard the ocean and sustainable seafood supplies over the next decade. The announcement marks a significant expansion of the MSC’s Ocean Stewardship Fund (see above) which aims to end overfishing. Philanthropic organisations, businesses and governments are encouraged to contribute to the fund, which has already delivered more than 100 grants, including almost 40 in emerging economies. These funds assist a wide range of fisheries and invest in research and innovation to improve fishing practices on the water.
17
## **REFERENCE AND ADMINISTRATION**
## **Trustees and Directors of the Marine Stewardship Council (MSC)** :
|Dr Werner Kiene|Chair|Appointed October 12|
|---|---|---|
|Mr Giles Bolton||Appointed January19|
|Ms Maria Damanaki|Development Committee Chair|Appointed July19|
|Mr Kristjan Th. Davidsson|Treasurer and Finance Committee Chair|Appointed July21|
|Mr David Lock|Audit & Risk Committee Chair|Appointed November 18|
|Dr Kevin Stokes||Appointed July20|
|Mr Paul Uys|MSCI Board Chair|Appointed August 15|
|Mr Stuart Green||Resigned March 23|
|Dr Christopher Zimmermann|Technical Advisory Board Chair (to
January 23)|Resigned January 23|
|Mr Jim Leape||Resigned July22|
|Ms Amanda Nickson|Stakeholder Advisory Council Co-Chair|Resigned July22|
|Ms StefanieMoreland|Stakeholder Advisory CouncilCo-Chair|Resigned May22|
The Trustees of the MSC are the charity’s Trustees under charity law and are the directors of the charitable company.
**Principal Office & Registered Office** : Marine House, 1 - 3 Snow Hill, London, EC1A 2DH
## **Principal Officers – the Executive Committee**
Mr Rupert Howes Chief Executive Officer Dr Alene Wilton Chief Operating Officer Dr Rohan Currey Chief Science & Standards Officer Mr Nicolas Guichoux Chief Program Officer Ms Ishbel Matheson Chief Communications Officer
## **Advisers**
Auditors: Crowe U.K. LLP, 55 Ludgate Hill, London, EC4M 7JW Bankers: HSBC Plc, 165 Fleet Street, London, EC4A 2DY Solicitors: DAC Beachcroft LLP, 100 Fetter Lane, London, EC4A 1BN Bird & Bird LLP, 12 New Fetter Lane, London, EC4A 1JP
Investment managers:
Northern Trust Company, 50 South Lasalle Street, Chicago, IL 60680, USA UBS, 1 Finsbury Avenue, London, EC2M 2AN
## **TRUSTEES’ RESPONSIBILITIES**
The Trustees are responsible for preparing the Trustees’ Report, the Strategic Report, and the financial statements in accordance with applicable laws and regulations.
18
Company law requires the Trustees to prepare financial statements for each financial year in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards) and applicable law.
Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the charitable company and of its net incoming resources for that period. In preparing these financial statements, the Trustees are required to:
- Select suitable accounting policies and then apply them consistently;
-
- Make judgments and estimates that are reasonable and prudent;
- State whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
- Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue to operate.
The Trustees are responsible for keeping proper accounting records that are sufficient to show and explain the charitable company’s transactions and disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
## **S 418 CONFIRMATION**
Each of the Trustees at the date of approval of this report confirms that:
- so far as the Trustee is aware, there is no relevant audit information of which the company’s auditors are unaware; and
- the Trustee has taken all the steps that he/she ought to have taken as a Trustee in order to make himself/herself aware of any relevant audit information and to establish that the company’s auditors are aware of that information.
This confirmation is given and should be interpreted in accordance with the provisions of section 418 under Companies Act 2006.
This Annual Report of the Trustees, under the Charities Act 2011 and the Companies Act 2006, was approved by the Board of Trustees on 27 July 2023 including approving in their capacity as company directors the Strategic Report contained therein, and is signed as authorised on its behalf by:
19
Date 27 July 2023
Dr Werner Kiene Chairman of the Board of Trustees
20
## **Independent Auditor’s Report to the Members of Marine Stewardship Council**
## **Opinion**
We have audited the financial statements of Marine Stewardship Council (‘the charitable company’) and its subsidiaries (‘the group’) for the year ended 31 March 2023 which comprise the Consolidated Statement of Financial Activities, Charity Statement of Financial Activities, Consolidated and Charity Balance Sheets, Consolidated Statement of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
- give a true and fair view of the state of the groups and the charitable company’s affairs as at 31 March 2023 and of the group’s and the charitable company’s income and expenditure, for the year then ended;
- • have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
- have been prepared in accordance with the requirements of the Companies Act 2006.
## **Basis for opinion**
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
## **Conclusions relating to going concern**
In auditing the financial statements, we have concluded that the trustees' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's or the group’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.
## **Other information**
The trustees are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
## **Opinions on other matters prescribed by the Companies Act 2006**
In our opinion based on the work undertaken in the course of our audit
21
- the information given in the trustees’ report, which includes the directors’ report and the strategic report prepared for the purposes of company law, for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the strategic report and the directors’ report included within the trustees’ report have been prepared in accordance with applicable legal requirements.
## **Matters on which we are required to report by exception**
In light of the knowledge and understanding of the group and charitable company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report included within the trustees’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate and proper accounting records have not been kept or returns adequate for our audit have not been received from branches not visited by us; or
- the financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of trustees' remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.
## **Responsibilities of trustees**
As explained more fully in the trustees’ responsibilities statement, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the trustees are responsible for assessing the charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.
## **Auditor’s responsibilities for the audit of the financial statements**
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws and regulations are set out below.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
## **Extent to which the audit was considered capable of detecting irregularities, including fraud**
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due to fraud or error, and discussed these between our audit team members. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion.
We obtained an understanding of the legal and regulatory frameworks within which the charitable company and group operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Companies Act 2006, the Charities Act 2011 together with the Charities SORP (FRS 102). We assessed the required compliance with these laws and regulations as part of our audit
22
procedures on the related financial statement items.
In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charitable company’s and the group’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charitable company and the group for fraud. The laws and regulations we considered in this context for the UK operations were General Data Protection Regulation, employment legislation and taxation legislation. We also considered compliance with local legislation for the group’s overseas operating segments.
Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any.
We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be within the recognition and classification of income and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management and the Audit & Risk Committee about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, reviewing accounting estimates for biases, reviewing regulatory correspondence with the Charity Commission and reading minutes of meetings of those charged with governance. In respect of the recognition and classification of income, substantive sample testing was undertaken to ensure that the transactions occurred, were recognized accurately, completely, in the correct financial year and classified correctly in the financial statements.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed noncompliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect noncompliance with all laws and regulations.
## **Use of our report**
This report is made solely to the charitable company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company’s members as a body for our audit work, for this report, or for the opinions we have formed.
Julia Poulter
Senior Statutory Auditor For and on behalf of Crowe U.K. LLP Statutory Auditor
London
Date: 25[th] August 2023
23
## **CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES (INCLUDING INCOME AND EXPENDITURE ACCOUNT) FOR THE YEAR ENDED 31 MARCH 2023**
|Notes
**Income**
Donations and leagacies
2
Income from charitable activities
Income from investments
3
Other trading activities
**Total Income**
**Expenditure**
Expenditure on raising funds
4
Expenditure on charitable activities
5
**Total Expenditure**
**Net income before transfers and other gains**
**and losses**
Gain / (Loss) on revaluation of fixed asset
investments
**Net income before transfers**
Gain / (Loss) on revaluation of foreign assets
Transfers between funds
**Net movement in funds**
**Funds at 31st March 2022 (31st March 2021)**
**Funds at 31st March 2023 (31st March 2022)**|General
Designated
Restricted
Funds
**Total Funds**
**2023**
£'000
£'000
£'000
£'000
433
0
1,840
**2,273**
29,045
0
0
**29,045**
774
0
21
**795**
621
0
0
**621**
30,873
0
1,861
**32,734**
615
125
1
**741**
26,867
930
2,031
**29,828**
27,482
1,055
2,032
**30,569**
**3,391**
**(1,055)**
**(171)**
**2,165**
(773)
0
0
**(773)**
2,618
(1,055)
(171)
**1,392**
22
0
0
**22**
(1,208)
905
303
**0**
1,432
(150)
132
**1,414**
36,331
2,006
2,379
**40,716**
37,763
1,856
2,511
**42,130**
**UNRESTRICTED FUNDS**|General
Designated
Restricted
Funds
**Total Funds**
**2022**
£'000
£'000
£'000
£'000
468
6
1,932
**2,406**
26,132
0
0
**26,132**
744
0
0
**744**
507
0
0
**507**
**UNRESTRICTED FUNDS**|
|---|---|---|
|||27,851
6
1,932
**29,789**|
|||621
0
0
**621**
25,023
751
2,274
**28,048**
25,644
751
2,274
**28,669**
2,207
(745)
(342)
**1,120**
947
0
0
**947**|
|||3,154
(745)
(342)
**2,067**
(149)
0
0
**(149)**
(1,268)
1,126
142
**0**|
|||1,737
381
-200
**1918**
34,594
1,625
2,579
**38,798**|
|||36,331
2,006
2,379
**40,716**|
There were no recognised gains or losses other than those included in the Statement of Financial Activities. All Income and Expenditure derive from continuing activity.
24
## **CHARITY STATEMENT OF FINANCIAL ACTIVITIES (INCLUDING INCOME AND EXPENDITURE ACCOUNT) FOR THE YEAR ENDED 31 MARCH 2023**
|Notes
**Income**
Donations and leagacies
GiftAid received from trading subsidiary
Income from charitable activities
Income from investments
Other trading activities
**Total Income**
**Expenditure**
Expenditure on raising funds
Expenditure on charitable activities
**Total Expenditure**
**Net income before transfers and other gains**
**and losses**
Gain / (Loss) on revaluation of fixed asset
investments
**Net income before transfers**
Transfers between funds
**Net movement in funds**
**Funds at 31st March 2022 (31st March 2021)**
**Funds at 31st March 2023 (31st March 2022)**|Unrestricted
Funds
Designated
Funds
Restricted
Funds
**Total Funds**
**2023**
£'000
£'000
£'000
£'000
437
0
1,750
**2,187**
15,905
0
0
**15,905**
8,016
0
0
**8,016**
772
0
21
**793**
0
0
0
**0**
25,130
0
1,771
**26,901**
615
125
1
**741**
21,311
930
1,808
**24,049**
21,926
1,055
1,809
**24,790**
3,204
(1,055)
(38)
**2,111**
(773)
0
0
**(773)**
2,431
(1,055)
(38)
**1,338**
(1,194)
905
289
**0**
1,237
(150)
251
**1,338**
33,885
2,006
4,705
**40,596**
35,122
1,856
4,956
**41,934**
**UNRESTRICTED FUNDS**|Unrestricted
Funds
Designated
Funds
Restricted
Funds
**Total Funds**
**2022**
£'000
£'000
£'000
£'000
430
6
1,932
**2,368**
13,379
0
0
**13,379**
7,216
0
0
**7,216**
744
0
0
**744**
6
0
0
**6**
21,775
6
1,932
**23,713**
621
0
0
**621**
19,457
750
1,806
**22,013**
20,078
750
1,806
**22,634**
1,697
(744)
126
**1,079**
947
0
0
**947**
2,644
(744)
126
**2,026**
(1,243)
1,126
117
**0**
**UNRESTRICTED FUNDS**|
|---|---|---|
|||1,401
382
243
**2,026**
32,484
1,624
4,462
**38,570**|
|||33,885
2,006
4,705
**40,596**|
There were no recognised gains or losses other than those included in the Statement of Financial Activities. All Income and Expenditure derive from continuing activity.
25
The financial statements on pages 24 to 40 were approved and authorised for issue by the Trustees on 27 July 2023 and signed on their behalf by:
Dr Werner Kiene Company Registration Number 3322023
Chairman of the Board of Trustees
26
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE GROUP
FOR THE YEAR ENDED 31 MARCH 2023
2023
2022
Statement of &75h f
Cash flows from operatiTrg actNities:
Net cosh provided by (used iF7J opemtirw ortivitie5
Gish fkhvs from in?1 èrti¥ities,'
Dividend5. interest and rents frorn investments
Proceeds from the sa le5 of properry, plant and equipment
Purchase of properry, plant and equipment
Proceeds from sale of investments
Purchase of investments
Nei cosh pmvFWby fusedinj invesriw artivities
G75h flow5 from financi èctivities.,
repayrnent5 of borrowing5
Net cosh provNkdty (u5edln)fMKJg ocrivities
La38
L720
795
744
16191
3,518
15.0511
11.3571
11.4131
6,31S
15,9751
13291
cosh ondcosh eqwwolents in the repornwperiod
cash equi¥abents ai the beeinniN4 of the ieportirng period
Cosh ondca5h ryKvalert5 rt the of the reportiTrJ peiiLKI
1191
10,398
iOJ79
1,391
9,IX)7
iOJ98
Reconciliation of rbet wKome I lexpermliwrel to net cash lknw from Iyeratiwa
2023
2022
Net income I (expenditure) for the relyNti perwA la5 per the ststement of
fiThancial actNrties1
Adjustmems for:
Amortisation and depreciation charges
FX on Foreign Assets
Net unreal i5ed 1055 Igainl and other movernents on investrnent
Dividends. interest and rents frorn investments
(Prof it) l Loss on the sale of fixed assets
lincreasel I decrease in debtors
Increase I Idecreasel in creditors
Net provmled by lused in) OsTrat1 arti¥hi
L414
L918
1.183
13821
11.5521
1744
15381
2.182
17951
11,1121
16981
L33B
1.177
L720
Analy515 01 cash aThl cash equivalents
2023
2022
Cash in hand
Notice deposits (less than 3 months)
Totsl cash aThJ cash equivaltnts
6.407
3.972
10,379
6,854
10.398
27
**NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2023**
## 1. _**Accounting policies**_
Marine Stewardship Council is a Public Benefit Entity registered as a charity in England and Wales and a company limited by guarantee. It was incorporated on 17[th] December 1997 (company number 3322023) and registered as a charity on 10[th] December 1997 (charity number 1066806).
The company was established under a Memorandum of Association which established the objects and powers of the charitable company and is governed under its Articles of Association (amended July 2014).
In the event of the company being wound up members are required to contribute an amount not exceeding £1 each.
The registered office is Marine House, 1-3 Snow Hill, London, EC1A 2DH.
The following accounting policies have been used consistently in dealing with items which are considered material in relation to the Charity’s financial statements.
**Basis of accounting:** The consolidated financial statements have been prepared under the historical cost convention, except that fixed asset investments are stated at market value, and in accordance with Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), the Companies Act 2006 and the Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) – effective 1[st] January 2019.
These financial statements consolidate the results of the charity and its five wholly owned subsidiaries, Marine Stewardship Council International Limited (which is incorporated in the UK), Marine Stewardship Council Limited (which is incorporated in the United States), Marine Stewardship Council Trust (which is incorporated in Australia), Marine Stewardship Council Asia Ltd (which is incorporated in Singapore), and Ippan Shadan Hojin MSC Japan (which is incorporated in Japan) on a line by line basis.
MSCI also has a Chinese registered subsidiary, An Hai Xu Fishery Certification Consulting (Beijing) Ltd Co (known as MSC China), the activities of which help fulfil MSC’s charitable mission in China.
The functional currency of the Charity and its subsidiaries is GBP because that is the currency of the primary economic environment in which the group operates. The consolidated financial statements are also presented in GBP.
MSC’s overseas subsidiaries are converted into GBP and consolidated into the group accounts using the year end exchange rate, with the foreign exchange gain or loss arising reported as gains or losses arising upon revaluation of foreign assets in the SOFA. Fixed assets held in the overseas subsidiaries are immaterial.
**Going Concern:** The Trustees approve the annual budgets and periodic forecasts to ensure there is sufficient working capital to meet the charity’s obligations over the subsequent 12 months. The charity meets its ordinary working capital requirements through its existing cash balances. The Covid-19 impact has not had a material impact on the charity’s financial operations. Having regard to the above, the current cash position and the expected cashflow over the following 12 months the Trustees believe it appropriate to adopt a going concern basis of accounting in preparing the financial statements.
After reviewing the group’s forecast and projections, the Trustees have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. This view is supported by the level of free reserves held at the year-end (equivalent to12 months expenditure). The group therefore continues to adopt the going concern basis in preparing its consolidated financial statements.
**Critical accounting judgements and key sources of estimation uncertainty:** In the application of the accounting policies directors are required to make judgement, estimates, and assumptions about the carrying value of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historic experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The critical estimate involves accruing for royalty income, with around 2% to 10% of the total royalty accrued each year being based upon historic trends only, rather than information received post Year End from the license holder relating to actual labelled sales for the period of the accrual. This arises because turnover declaration returns of labelled product sales are submitted by license holders in arrears. As a result, labelled product sales data covering reporting periods ending 31[st] March are received after the financial year end. At the point the accounts are drafted, not all license holders may have reported their labelled sales data (even though the license agreement obligates them to submit their turnover declaration by one month after the end of the reporting period in question). For these license holders, the level of labelled sales (and hence royalty income to be accrued) are estimated based on historic trends.
Judgements are also made for bad debts provisions, based upon reviewing debts older than 90 days at the year end, and for certain contracts of service, whereby the fee to be received by MSC for services delivered continue to be subject to negotiation after the year end.
29
## **Fixed Assets: Intangible fixed assets**
Intangible fixed assets represent software costs capitalised in accordance with FRS102. These are stated at historic cost and amortised on a straight-line basis over the period which revenue is expected to be generated (typically 4 years). Items costing less than £500 are expensed in the year of purchase.
## **Tangible fixed assets**
Tangible fixed assets are recorded at cost or, in cases where tangible fixed assets have been donated to Marine Stewardship Council, at valuation at the time of acquisition. Tangible fixed assets are capitalised in the balance sheet at cost, except for items costing less than £2500 which are expensed in the year of purchase.
**Depreciation:** Depreciation for UK entities has been provided at the following rates in order to write down cost or valuation, less estimated residual value, of all tangible assets by equal annual instalments over their expected useful lives.
- Furniture, Fittings & IT equipment 25%
- Refurbishment costs of Snow Hill over 7 years
- London Virtual Freehold Property Building cost over 99 years
**Incoming resources:** Grants and donations are recognised as income when it is clear MSC has entitlement to the income, that the donation is reasonably certain to occur and that the value of the donation can be measured. Logo license royalty income is accounted for in the period in which the labelled products were sold by our trading partners. Similarly, fixed fee income, such as the North American Subscription Program, is recognised as income for the contracted period, requiring a deferral of income if the fixed fee for a financial year is raised in advance. Service fees, such as Peer Review College fees or ASCI fees, is accounted for in the period the services were delivered. Donated services and facilities are included at the value to the charity where this can be quantified. No amounts are included in the financial statements for the services donated by volunteers.
**Expenditure:** Resources expended are included in the Statement of Financial Activities on an accrual basis, inclusive of VAT which cannot be recovered. Since 1[st] February 2009, the Charity has been registered within a VAT group consisting of itself and its UK based trading subsidiary, Marine Stewardship Council International. From 1[st] February 2009, therefore, input tax can be partially recovered based upon a business: non-business model.
Expenditure on raising funds comprise expenditure incurred in encouraging others to make contributions to the charity and include staff costs directly attributable to that activity. Expenditure on charitable activities comprise direct expenses incurred on the defined charitable purpose of the charity, and include staff costs directly attributable to the charitable activities. Where costs could not be directly attributed to any particular function or activity (i.e., costs classified in MSC’s ledger as relating to senior staff and office, IT, HR, finance, premises support type costs), they have been allocated by applying bases consistent with the use of the resource. Senior staff costs are apportioned to charitable activities in relation to an estimate of time that that senior member will focus on a specific charitable activity. Head Quarter support costs are allocated to charitable activities in proportion to the staff costs sitting in that charitable activity. Local office support costs are allocated based on an estimation of charitable activity focus of that local office (that is, across servicing and outreach and education and awareness only).
**In Kind income and expenditure:** Where in kind supplies are received MSC will value the income and corresponding expenditure based on the value of the gift as identified either by the donor or, if appropriate, by the assumptions set out in any contract underpinning the commercial relationship between the donor and MSC.
**Cash and bank and current asset investments:** Cash balances held in interest bearing deposit accounts (business reserve accounts or time deposits) are classified as current asset investments in the balance sheet. All other cash balances held at bank or in hand are classified as cash at bank or in hand in the balance sheet.
**Investment income:** Investment income is recognised in the accounts when it is receivable and is allocated to the appropriate fund.
**Investments:** The charity has four wholly owned subsidiary undertakings.
- Marine Stewardship Council International Limited is a trading subsidiary and receives royalties from logo licensing fees as well as income from the sale of merchandise.
- Marine Stewardship Council Limited is a subsidiary incorporated in the United States and promotes the aims of the parent there.
- Marine Stewardship Council Asia Pacific Pty Ltd is a subsidiary incorporated in Australia and promotes the aims of the parent there and in South East Asia generally.
- Marine Stewardship Council Asia is a subsidiary incorporated in Singapore and promotes the aims of the parent there and in Asia generally.
Marine Stewardship Council International has a wholly owned subsidiary, An Hai Xu Fishery Certification Consulting (Beijing) Ltd Co (known as MSC China), which received its business license 2 February 2016. In 2020, MSC established a non-profit General incorporated association (GIA), Ippan Shadan Hojin MSC Japan, to support its charitable mission in Japan.
Investments in the subsidiaries are stated at cost.
Fixed asset investments are held in a portfolio covering equities, fixed income securities, real estate, and commodities, which is managed by Northern Trust, and a second fund, managed by UBS, focused upon fixed income securities. The equity element of
30
the Northern Trust fund is invested in Socially Responsible Investment (SRI) funds. The SRI funds mirror Morgan Stanley Capital International Ethical, Social and Governance indexes (namely the MSCI World ESG index and the MSCI US IMI index) to guide investment opportunities in equities screened for ESG criteria. The UBS fund focuses on lower risk investments consisting of gilts and corporate paper. Fixed asset investments are reported in the financial statements at their market value on the balance sheet date, including the effect of any unrealised gains and losses as of that date.
**Foreign exchange:** Assets and liabilities denominated in foreign currencies are translated at year end exchange rates. Exchange differences are included in the statement of financial activities. Transactions during the year are recorded at the prevailing rates.
**Financial assets and liabilities:** Financial assets and financial liabilities are recognised when the Charity becomes a party to the contractual provisions of the instrument. Additionally, all financial assets and liabilities are classified according to the substance of the contractual arrangements entered into.
Financial assets and liabilities are initially measured at transaction price (including transaction cost) and are subsequently remeasured where applicable at amortised cost except for forward rate currency contracts which are subsequently measured at fair value with gains and losses recognised in the Statement of Financial Activities. Assets and liabilities held in a foreign currency are translated to GBP at the balance sheet date at an appropriate year end exchange rate.
The Group enters into forward rate currency contracts to manage its exposure to fluctuations in exchange rates throughout the year. These contracts are recognised at fair value with gains or losses recognised in the Profit and Loss account.
**Pension costs:** In the UK, the charity operates a defined contribution group personal pension scheme for the benefit of any employees wishing to join. Defined contribution schemes also operate for overseas based employees in other, non-UK, jurisdictions in line with local legislation. The contributions payable under the schemes are charged in the income & expenditure account, and the assets are managed by an independent organisation.
**Taxation:** Marine Stewardship Council is a registered charity, and therefore is not liable for income tax or corporation tax on income derived from its charitable activities since it falls within the various exemptions available to registered charities.
**Operating lease assets:** Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight-line basis over the lease term.
**Fund accounting:** The general fund comprises those monies which may be used towards meeting the charitable objectives of the charity at the discretion of the directors. The restricted funds are monies raised for, and their use restricted to, a specific purpose, or donations subject to donor-imposed conditions.
31
2023
2022
Grants from other
Iharitable bodies
Grants from government
organi5aElQnS
Donations from companies
Other donatitrns
2.041
2.170
103
127
232
2.273
2023
2022
Bank and inve5trnent funds
Interex and dividends
re1Vable
795
744
4 ExPertton Tr1r4 fvr
2023
2022
General fundraising a(riyities-.
343
18
other runninE Costs
inve5trnent manaEer5 fee5
5UPPQrt
62
95
175
741
164
621
Exper*nure tharitabk
artivhles
Artivities
undetEaken
dirertly
Artivities
underraken
support
costs
Governance
Supporrco5E5
Governance
costs
2022
costs
Policy & maintenance of
Standards
Edutation & awareness
Servicing & outreaih to
fisheries and commercial
4.725
1.450
4,041
1.418
211
5.670
1.520
9.718
8.362
1.704
iii
10277
8.110
2.313
228
IQ651
7.ts19
2.449
iii
5e(tor
Logo Iitensing tDglg
(kean Stewardship Fund
1.534
1,052
a93
7S
1.157
751
414
70
L641
751
L052
23.3
5.676
762
21,360
5.985
703
Poliiy &
Raising Funlls giandards
Education & 5etyicin4 &
awareness
Outreath
Lo80 linSIng
Total 2018
Toiai 1022
Oflice serwces
IT 5etyiies
Finance services
Resources
Premises
43
91
161
752
si
378
576
1.199
82
287
169
2.315
L456
3,0$4
207
726
428
5.851
1.445
3,342
14
22
13
175
ir
1.450
iii
1.520
395
6.149
SupportC05t5 have beefi allocated to a(riyitie5 in line with total e¥penditurewithin eath offiie furKtion,
this IS a reasonable approxirnation of the resource usage Within eath attiViry>.
32
## 7 **Net income / expenditure**
|**Net income / expenditure**|||
|---|---|---|
|The group's net income / expenditure is stated after or charging:
Fees payable to the parent charity's auditors for the audit of the charity's and UK subsidiary accounts
Fees payable to the component auditors for the audit of the charity's overseas subsidiaries
Total fees payable to auditors for auditing services
Fees payable to the parent charity's auditors for tax and other services
Operating lease charges - land and building
Operating lease charges - office equipment
(Profit) / Loss on fixed asset disposal
Depreciation
**Trustee / directors and employees**
Staff costs, including directors' remuneration, were as follows:
Wages and salaries
Social security costs
Pension
The number of staff employed by the charity during the year was as follows:
Number of staff during the year|2023
£'000
31
19
50
3
576
7
0
885
2023
£'000
12,817
1,624
1,207
15,648
2023
number
247|2022
£'000
25
21
46
4
484
6
0
1,183
2022
£'000
12,210
1,669
1,154|
|||15,033|
|||2022
number
251|
## 8 **Trustee / directors and employees**
33
10 Intangible assets
Group
Trademark
Group Software
and database
Group
Total
Charity
Cost
At 1st April 2022
Additions
Disposals / write offs
At 31 March 2023
5.331
619
5.331
619
619
5.950
5.950
5,565
Depreclatlon
At 1st April 2022
Charge forthe year
Di5P05als / write off5
At 31 March 2023
3.767
789
3.767
789
3.383
4.556
4.556
4.171
Net book value
At 11 March 2023
At 31 March 2022
1.394
1,564
1.394
1,564
1,394
1,563
Trademark intangible a55et represent5 the £1 purchase costto buy the MSC logo trademark fvom Marine
Stewardship Council Intemational.
The amortisation charge of intangible assets ha5 been allocated equally acros5 Policy and maintenance of standards,
Education and awareness, Servicing and outreach to fisheries and commercial sector, and Logo licensing costs.
£121.186 of the £1,394.fMxigroup software and database net book value relates to the capitalised development
cost of the Enhanced Tracèability Project presently under construrtion.
11 Tanglble flxed assets
Group Long
Leasehold
Property
Group Fumiture,
fittings and IT
equipment
Group
Total
Charity
C05t
At 1st April 2022
Additions
Disposals / write off5
At 31 March 2023
1,131
4,831
4.703
3,71A)
1,131
4,831
4,703
Depreciation
At 1st April 2022
Charge forthe year
Disposals / write offs
At 31 March 2023
410
905
1.315
95
1,209
37
4147
963
1.410
Net bookvalue
At 31 March 2023
At 31 Marth 2022
3.253
8,421
3,516
226
3A94
34
|**Income:**
Donations and leagacies
Income from charitable activities
Income from investments
Other trading activities
Grants from UK Charity
**Total income**
**Expenditure:**
Expenditure on charitable activities
Foreign exchange (gain) / loss
**Total Expenditure**
Net Income / (Expenditure)
Gift Aid to UK Charity
Funds at 1st April 2022
Funds at 1st April 2023
Fixed Assets & Intangible Fixed Assets
Investments in subsidiary
Debtors
Cash at bank and in hand
Total current assets
Creditors: Amounts falling due with one year
Net current assets (liabilities)
Long term liabilities
Total assets less total liabilities
**Represented by:**
Share Capital
Unrestricted funds
Restricted funds|MSCI Ltd
MSC Ltd
MSC Asia
Pacific Pty
Ltd
MSC Asia
Ltd
An Hai Xu Fishery Certification
Consulting (Beijing) Ltd Co
MSC Japan
0
76
15
0
0
0
29,621
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
4,353
985
117
717
588|
|---|---|
||29,621
4,429
1,000
117
717
588|
||13,562
4,244
1,149
115
687
605
154
(48)
2
2
5
15|
||13,716
4,196
1,151
117
692
620|
||15,905
233
(151)
0
25
(32)
15,905
0
0
0
0
0
131
131
79
15
(142)
52|
||**131**
**364**
**(72)**
**15**
**(117)**
**20**|
||0
11
5
1
0
0
179
0
0
0
0
0
10,824
13
24
4
14
5
2,813
552
112
16
69
24|
||13,637
565
136
20
83
29
(13,685)
(212)
(179)
(6)
(21)
(9)|
||(48)
353
(43)
14
62
20
0
0
(34)
0
0
0|
||**131**
**364**
**(72)**
**15**
**62**
**20**|
||145
0
0
0
179
0
(14)
364
(72)
15
(117)
20
0
0
0
0
0
0|
||**131**
**364**
**(72)**
**15**
**62**
**20**|
35
1024
2022
8alance at beginningofyear
dition of principal cash
Sal@ ot In¥estrnents
19,222
17,628
13.5181
5,051
11,5331
11,3101
756
16,3151
5,975
340
PurchaseDf iDve5tmentS
Cash zefterated by531e/lpur£haselotinvÈStrnents
GJinll1055loD investment
Dividend and interest income
564
744
Investment rn?naser5fees
Foreign exChae revaluation
1961
382
538
1.594
19,111
19,222
Th@ historic cost ofthe illvestrnént mad@ 15 £I2,2,971.
A552tCla55esDf Fixed Asset investments are".
2013
iozz
Equity Funds
Fixed Incorneseturities
14,W7
4.022
14,345
2,962
156
Real Estatefunos
Cornrnoditie5
410
469
Money Marketfunds
1,29)
19.222
19.111
ThRSa afR comprised of cash depDSits haldfor inv*5tment purpDseS
Group
1023
Group
2022
Chèrity
2022
2023
Balance at boginningof y•ar
ditlOD51lreLlurtlOD51
C105ingvalu• at *ndofy•ar
2,975
569
3.421
551
2,859
562
428
a,972
3.544
3.972
2,421
Gro
GToup
2022
Charity
2022
io
2011
Trad• Dobtors
1,358
244
2,140
270
120
143
Other Debtors
196
189
Propayrnents and Accrued incorne
Amounts duefrom Subsidiary un4Yertakin
10,376
8,456
773
643
12.697
13.786
11,552
12,527
11,978
10,866
36
cedrs. amMts fall#wd dthÈvJlthin one year
Group
2023
Group
2021
Charity Iharity
2023
2021
Trade Creditors
Tax and social security creditor
Other creditor5
Accruals and deferred income
1,324
1.671
376
1.186
1.417
1,030
163
297
176
336
932
596
1,356
3.816
4.650
2.396
2.387
Movement on deferred incorne..
GroLV
2023
202J
Deferred income at l April 2022
Rele65ed ro income in year
Incorne deferred in year
Deferrecj intome at 31 March 2023
13861
16 tredrEors: arrbJuntsfal1w 23fter rreIhan ane ye
fjrwp
2023
fjrwp
2022
r Owrity
2023
Re(ertifi(ation fund li&bility
Ocean Stewardship Fund
Orher Creditors
Totsi fallin£ due after morethan one year
li
302
302
336
302
The Recertification Fund is now closed and bai8nces accrued Into it are bein£ drawn down as claims are made. The Recerrification Fund
me(hanisrn ha5 been replaced bythe Reiertifiiation As5i5tanie Fund. one of the strands of the O(ean Stewardship Fund IOSFI. The OSF
consists ofthe Recertification Assistance Fund. which supports the costs of recertification for fisheries that are at their second or subsequent
recerrification-. the Transition Assistance Fund, which supporrs fisheries to m8Ke Ehe necessary Improvements to become certified-. the
Science and Re5ear(h Fund, which SUPPOfts researih proie(ts with an efflpha5is upon condition closure." the Innovation Fund. which supports
strateeically irnportant research. The OSF is reported as desiEnated funds on the face of the SOFA
ovemeni on recertilic?tion fund.
(harity
2023
2023
Re£ertifi£aEion fund l April 22
Disbursments in year
Write Qff of overprov15ion
Re£ertifitaEion fund 31 March 23
io
The £lO,tW balance on the ertIfication fund is included in note 15- Creditors.. amounts falling duewithin oneyear'othef Creditors.
37
17a Fu-GrOup
Balènce
IstApril 2022
Incorne
Expenditure Galns and losses
Transfers
31st Marth 2023
Note
D&L Packard Foundation
Canadian Pathway
Evidence Rerluirement Framework. OSF
FAn Climate change
05F Climate Change
05F Core Strate8iC
PortUBal PPA 05F
Scienceweek
P. Cabo Verde
Benguela Pathw)v
MAVA Lead 2
Loan Gaurantse. Walton
MAVAOSF Medit
MAVAOSF WestAfriia
EastA%ia Sea- Ven3
Nephrop Research UK
52
23
23
39
39
77
2C
173
855
855
44
li
16
17
20
io
li
12
13
14
751
279
277
19
17
51
769
14
15
23
23
16
62
76
1641
17
18
19
20
21
22
Projert UK 1 3
Cephs & Chef5
Multiplier- Certification5 & RBtinE5
Patkard Foundation- EèstA%ia Sea
225
107
222
70
36
134
MAVAMedpJth
MAVA WestAfrica
Walton Mexico
Walton Foundation
23
24
25
26
41
304
61
83
166
Im
435
14351
Total Restted
2J79
12.0821
303
2.511
Unrestricted".
General purposefund
36.331
30.873
127.4821
11.2081
37.765
DesiEnated- OSF
27
11.0551
905
56
Total Group Funds
40,716
32,734
130,5691
42,130
Exchange gains and 1055e5 arisingfrom therevaluation offoreign currenq assets held obEr5ea5 have been set against
Transfers betv¢eenfund5 representtransfers of unrestricted funds Into restritted funded actiwtie5 as match fundinE contributiotb5
contributions. Ttan5fer5 of unre5tritted funds into designated fund5 relatetothe an 5teward5hip Fund15eE beliMI.
NDte5
11 Capatiiybuildini-. 21 canadian Pithway Pro1 31 Ewdente Requirement Pramewotk. OSF-.
41 FAOClimaEe Chènie-. Sl OSF Climate Chanqe.. 61 OSF Siiaie8iC'.
71 Porcu8Ji pp& OSF- 81 Narionai kience Week. Ausuaiièn Government., 91 FAO, CatsoVee..
101 Ben8ueiJ Paihwèw. 111 MAVA LEAD 2., 121 Wjiton. Loon Guarantee,.
131 MAVA. OSF. MediTerr¥ne?n., 141 MAVA. OSF. West Alrir¥.- 151 VenJ Eneriy. EJ5tAsi4 Seo-. 161 Nephroy Re5eJrch UK. 171 Levanti5 HellJ5fi5h
IBI Proiett UK CotPOTate Funders, 191 EU. Cephs &Chefs-. 201 Multiplier. Certifications & RatinE5,- 211 Packard. EaStla Sea
221 Multiplier. Surimi.- 231 MAVA Medpath. 241 MAV4 Medpath,- 251 Walton Mexico. 26) Walton Foundation 1920to 11-22
2710(ean Stewardship Fund IOSFI A desiEnated fund with a Ifold obiettive of supportingf15heriestransltlDninE towards m5c.fundlngiernCe and resear(h project5thatwill
For priDfyEarcompBrative5, see note 23
38
17b tle5¥MIEd£*tan 5tewwthThw FWJ
Group
2023
Group
2023
Group
2023
Group
2023
Group
2023
Gioup
Gioup
2023
Group
2023
Scitnc
Research Re5ear(h
Fund
Grants
Sistan
A55iStan
seed Fund Administration
Total
GBP{)
GBP
GBpr
GBP7
GBprx))
GBP
GBP
GBPI
Ocean stewardship Fund 31 March 22
549
23
371
219
357
2,W7
1,189
475
Incoming resources
Tiansters beDNeen tfftdS
12091
23
1841
Giants awaided duringtheyeaT
O¢eah 5tev¢•rOShiP Fyno 31 March 23
12841
427
l.Q87
341
1021
S(iellce
2012
Student
Rese)f¢n
Grants
G6PAl
1022
2D12
2012
AS5isian¢e
ASSisran¢e
5eeo AomiTh1Str)lion
T•1
Fund
G8pr
G8P()
G8pr
G8prth)
G8P
GBP
G8P(hJ)
Ocean Stewardship Fund 31 March 21
503
153
1,625
1.160
Incoming resources
Transters between IndS
120ai
1501
1501
17MI
2.iY)7
Giants awaided duringtheyeai
Otean 5tewar4Ship Fun4 31 March 22
12831
549
219
Charifw
Chèrif¥
Charify
1023
2023
SEietKe
1023
Student
1023
Assistanc
AssIsnC
SéÈd Fund
Fund
Funtt
Fund
Granls
GBP
GBPi
GBP
GBP
GBP
GBP
GBPIKM)
GBP
Otean Stewartt5hip Fund 51 Mah 22
Designations rnade inthetrEar
549
258
219
475
1,189
Trènsfer5 betweeDfund5
11091
65
12321
12841
ean Stewafd5hip Fund 51 Match 23
427
I.OB7
341
1022
2021
SEiellce
Research Research
Fund
GBP
1022
2012
2022
Sistance
Assistonce
Seed Fund
Fund
Fund
GBP
GBPi
GBP
GBP
GBP
GBP(KM)
OEEOll sfewofd5hip Fund 51 Motch 21
DeSlEnations rnade inthetrEar
IncDmmiThE resources
Trin5fer5 bElweEnfund5
Grant ad1rn expenditure
Grants awarded duringthe year
5teward5hip Fund 51 Motth 22
503
454
1,1
167
36
12831
549
1991
12831
2.iY)7
39
IB Fts. (haiity
Bèlance
BalaThÈe
tsE April 2022 Inrorne Expenditure
Gain5 and Transfer
losses
Slst Mah 2023
Note
O&L P6(kard Found4tion
Dutch Postcode Lottery
AVA. PPAMP
Nephrop Research Proj UK
O&L P6(kard Found4tion
52
83
61
535
1641
555
Levant15 Hella5fish
UK Proiert5taEe I
UK Proie(r Stage 2
UK ProiertStaEe 3
Ceph5 & Chef5
ultiplier- Certificatitrns
Packaril FouD¢ation- E451 Asia
BeThEuelb- Pathwby5 Project
MAVA Medpath
WAFIC
MAVA. LEAD 2
Walton- Loan GuarJntee
W6lton Foun¢atio
D&L Packard Foundation- Japan
EDEwicklungsEesellshaft IOEGI
75
41
42
175
172
io
li
12
13
14
33
1341
183
ly8
42
62
16
17
18
19
14
19
751
1,138
651
61
769
13501
651
61
21
MIDATLANTIC
Walton Foundation- Mexico
MAVA OSF Mettit
MAVA OSF We5tAfrica
Mexico WèlEOn 2022
OSF Climate ChanEe
FAO Clirnate Chènge
Eastla Sea. Vena
OSF Evidenre Requirement Framew
05F Core StrateEIC
OSF Portugal
FAO Cabo Verde
23
24
163
163
17
51
166
78
276
26
27
166
173
23
29
23
31
32
35
855
855
43
17
4P05
L771
4956
General F.urposefund
Designated- OSF
33.885
2.6
2:.130
35.122
IH56
34
9)5
T<>ts16roup Funds
40.596
26.901
124.7901
tT131
4L934
EKchanEegains and losse5 ari5ingfrom the rlUatIOn of foreign currency assets held overseas have been setagain5t
contribution5 TrJn5fers ol unrestricted funds Into de5iRnJted lund5 relJte to ¢heOceJn 5tewJrdship Fund15ee beiowl.
11 Capacitybuilding.-2I Dirtch Postcode LotteryFish For GoDd-. 31 MAVA PPAMP.-
41 European Maritime &F15heries Fund IEMFFI-.51 Sustainable C*tOPUs proje¢
61 Japan Programme, Pa(kard-. 71 Multiplier. 5urimi.-81 LevaTrf15. Greece. 91 UKProjett Inshore l. 101 UK Proiett Inshore 2. Gree(e,- 111 UKPiojett Inshore 3-.
141 MAVA MedvJth.. 151 Vlestern Au5trJiiJn Fishini Indu5tryCouncil., 161 MAV4 LEAD 2,. 171 WJiton. Lo?n GuJrJntee.- 181 W?Iton FounooTion. Z019. 2021
191 Pa(kBrd Foundation.Japan-, 201 Entwi(klunESgesellshaftlOEGI,- 211 KDE project. kingfisher. 22) Midatlantic
231 Walton 5UPPOrtforthe MSC programme 20122.. 241 MAV4 05F Meditteranean." 251 MAVA, OSF. We5tAfrica."261 Walton, Mexico, In 05F.ClimateChange."
281 FAO. ClimateChange.- 291 Vena Energy. Ea5tAsia Sea, 501 OSF. Evidence Requirernent Framewotk-. 311 OSF, CDre kntegic.- 321 OSF. Portugal PathwayProject.- 331 FAO, Caboverde
541 Stewardship Fund IOSFI A desiEnated fund with a 3fold obiettive of 5UPPOrtlnE fisherie5transitioninE towards MSC, funding 5(ience and re5earih projects thatwill
For prioryearcomparatl%E5.5ee note24.
40
20 **Analysis of net assets between funds**
|Fund balances at 31 March as represented by:
Tangible fixed assets & investments
Intangible fixed assets
Net current assets
Long term liabilities
**Total net assts**|2023
2023
2023
2023
2022
2022
2022
2022
Unrestricted
Designated
Restricted
Total
Unrestricted
Designated
Restricted
Total
Funds
Funds
Funds
Funds
Funds
Funds
Funds
Funds
£'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
22,532
0
0
22,532
22,738
0
0
22,738
1,393
0
0
1,393
1,564
0
0
1,564
14,174
1,856
2,511
18,541
11,848
2,387
2,379
16,614
(336)
0
0
(336)
(200)
0
0
(200)
**37,763**
**1,856**
**2,511**
**42,130**
**35,950**
**2,387**
**2,379**
**40,716**|
|---|---|
## 21 **Related party transactions**
The Marine Stewardship Council's related parties as defined by the Financial Reporting Standard 102, and the nature of the relationship, are summarised below:
## Marine Stewardship Council International Limited (MSCI)
During the financial year MSC charged MSCI 15% of its office, premises and HR costs, 50% of its IT
costs, and an allocation of salary of the MSC’s Finance Director and Governance Secretary totalling
£1,616,190 (2022: £1,864,761). Allocations of key management salaries totalled £263,379 (2022:
£163,569). Gift aid payable for the year amounted to £15,904,446 (2022: £13,379,005) and the royalty payable by MSCI to MSC for the right to exploit MSC’s ecolabel amounted to £7,972,734 (2022: £7,137,544). At 31st March 2023, MSCI owed £12,697,495 in total to the parent charity company. This amount includes the amount payable by MSCI to MSC as royalty for the right to exploit the Charities intellectual property (i.e. the MSC ecolabel) and the gift aid due to the Charity of MSCI’s accounting surplus for the year.
The ultimate controlling party of the Charity is its members who are also the Directors and Trustees.
Kevin Stokes, a board member of Marine Stewardship Council (MSC), provided consultancy services amounting to £10,636 during the year.
## 22 **In-kind income and expenditure**
Income from charitable activities includes £13k (21/22 £293k) of in-kind income related to marketing support, the cost of which is reported under education and awareness.
41
23 Fur5-GrOuP
Ba13nte
t>ri1 2021
Incorne
Expenditure
Gains and105se5
Transfers 31st Mèr