Company registration number: 3897720 Charity registration number: 1078994
## Sustainability First
(A company limited by guarantee) Annual Report and Financial Statements for the Year Ended 31 December 2021
Community Accounting Plus Units 1 & 2 North West 41 Talbot Street Nottingham NG1 5GL
## **Sustainability First**
## **Contents**
|Reference and Administrative Details|1|
|---|---|
|Trustees' Report|2 to 11|
|Independent Examiner's Report|12|
|Statement of Financial Activities|13 to 14|
|Balance Sheet|15|
|Notes to the Financial Statements|16 to 23|
## **Sustainability First**
## **Reference and Administrative Details**
**Patrons** Edward Cantle Lord Larry Whitty Baroness Anne McIntosh Lord Robin Teverson **Trustees** Philip Barton, Chair Professor Gordon Mackerron, Vice Chair Xiao Yu, Treasurer Sarah Deasley Frederic Osborn Tracey Cotterill David Sigsworth Derek Lickorish Joe Perkins **Secretary** Claire Williams **Senior Management Team** Sharon Darcy, Director **Charity Registration Number** 1078994 **Company Registration Number** 3897720 **Registered Office** 85 Great Portland Street First Floor London W1W 7LT **Independent Examiner** John O'Brien, employee of Community Accounting Plus Units 1 & 2 North West 41 Talbot Street Nottingham NG1 5GL
Page 1
## **Sustainability First**
## **Trustees' Report**
The trustees, who are directors for the purposes of company law, present the annual report together with the financial statements of the charitable company for the year ended 31 December 2021.
## **Trustees and officers**
The trustees and officers serving during the year and since the year end were as follows:
Trustees: Philip Barton, Chair Professor Gordon Mackerron, Vice Chair Xiao Yu, Treasurer Sarah Deasley Frederic Osborn Tracey Cotterill David Sigsworth Derek Lickorish Joe Perkins Richard Adams, retired 31/12/2021 Secretary: Claire Williams
## **Structure, governance and management**
## _**Nature of governing document**_
The charity is a company limited by guarantee and registered charity. It is operated under the rules of its memorandum and articles of association dated 21st December 1999 and recently amended 30th June 2016. It has no share capital and the liability of each member in the event of winding-up is limited to £1.
## _**Recruitment and appointment of trustees**_
Overall management of the charity is the responsibility of the trustees who are elected and co-opted under the terms of the memorandum and articles of association. New trustees are sought by recommendation or through advertisement and interviewed, selected candidates are appointed with the agreement of the Board. Day to day project activity is managed and carried out by employees, paid associates and unpaid trustees.
## **Objectives and activities**
## _**Objects and aims**_
The principal objects of the charity are:
• To advance the knowledge and understanding of the environmental, economic and social dimensions of sustainability;
- To undertake and procure research and study, publishing any useful results;
• To promote ideas, actions and changes to further the integration of the quality of life with environmental protection. This includes the combating of climate change and global warming, at a community, regional, national and international level.
Page 2
## **Sustainability First**
## **Trustees' Report**
## _**Public benefit**_
The main activities undertaken to benefit the public are to procure research on sustainability, promote wider education on sustainability and public interest issues, particularly in water and energy, and publish useful results.
These activities benefit the public by advancing the knowledge and understanding of the environmental, economic and social dimensions of sustainability. This is achieved by engaging in research and analysis, publishing the results freely and using research for discussion for key players in the fields of sustainable energy and water. The beneficiaries are the users and future users of energy and water supplies in the UK and the environment in which they live.
The trustees confirm that they have complied with the requirements of section 17 of the Charities Act 2011 to have due regard to the public benefit guidance published by the Charity Commission for England and Wales.
## **Achievements and performance**
Summary of the main achievements during the period:
With the hosting of COP26 in Glasgow against a backdrop of escalating climate breakdown, 2021 was the year that many people, including much of the investment community, started to wake-up to the importance of sustainability. As we move towards the mid-point of this decisive decade for the climate crisis, it is clear that decisions made now will have a lasting impact on how we live, not just as consumers but also as citizens and communities and on the natural world.
Whilst sustainability has in many ways ‘come of age’, and Sustainability First has itself clocked up 21 years of activity, we maintain there is a greater need than ever for approaches which align interests, champion co-benefits and push the boundaries for transformational change. Work is needed to avoid green-wash to get action at the scale and pace necessary to deliver a sustainable future. Partnerships, and prioritisation are integral to such an approach.
Throughout 2021, Sustainability First continued to build on its two plus decades of cutting-edge research to develop practical solutions to better deliver social, environmental and economic wellbeing in UK utilities such as energy, water and communications. Our work is focused on delivering three external aims: shaping agendas in essential services for a sustainable future; connecting, engaging and inspiring people on sustainability; and embedding sustainability in practice.
This annual report starts with some highlights in numbers of our impact in the last year before looking at each of our aims in more detail, both in terms of what we have achieved in 2021 and what we plan for the future.
## **Sustainability First in numbers - highlights of our impact in 2021**
|**11**
**Consultation**
**responses**
**driving**
**substantive change**|Sustainability First is often one of the only independent voices / NGOs that responds
to technical consultations and calls for evidence from government and regulators.
Our responses are ‘open source’ and widely disseminated. They provide detailed
proposals on how to mainstream sustainability|
|---|---|
|**14**
**Expert**
**viewpoints**
**and**
**briefings shared**|These cutting-edge outputs provide thought leadership and technical insights in key
areas for sustainability in utilities such as the energy crisis and energy and water
nexus issues. Where appropriate we commission these from external thought leaders|
Page 3
## **Sustainability First**
## **Trustees' Report**
|**5 out of 8 utility**
**companies impacted**|Five of the companies who took part in our major Fair for the Future Project and
responded to our impact survey reported this work had a significant or moderate
impact on their strategy development. Five of the companies involved in the project
said they had reviewed their board sub-committees and engagement strategy as a
result of this work. One company reviewed their Memorandum and Articles of
Association and third party accreditation arrangements as a direct result of the Fair
for the Future Project|
|---|---|
|**13 agenda shaping**
**events**|We used our independent convening power and trusted status to bring members of
the public and key stakeholders together in discussion events, conferences,
workshops and roundtables to explore key topics for sustainability and build support
for sustainable change|
|**44%**
**artists**
**and**
**writers**
**thinking**
**differently**|Just under half of the artists and writers that applied for our 2021 Art and Writing
Prize on the theme of ‘Together for a Fair Climate Future’ said this programme
made them think differently about climate change and fairness|
|**23% prize entrants**
**taking action**|Almost a quarter of the prize entrants said that they had taken specific actions
around sustainability because of their engagement|
|**1,141 public votes**|The winning art entry for our ‘People’s Choice’ public vote for our 2021 Art and
Writing Prize, Moths to a Flame, received more than 400 votes out of 1,141 in total|
|**600 visitors to our**
**Reconnecting**
**art**
**exhibition**|Our first ever art exhibition, in the influential Bermondsey Project Space Gallery,
showcased the entries from our 2020 Art and Essay prizes on ‘How do we recover
from the pandemic for a sustainable future’ and the work of our first ever artist in
residence, Hugo Lamy, at UKPN|
|**160,000**
**twitter**
**interactions**
**and**
**2,000**
**YouTube**
**views**|Our Together for a Fair Climate Future discussion events attracted significant
interest on Twitter and YouTube. Participants were able to listen to, link up with and
be inspired by our fantastic contributors that included around 26 NGOs that we had
not previously worked with|
|**92%**
**increase**
**in**
**social**
**media**
**followers**|The significant increase in our reach from a very low base has led us to have an
active presence on YouTube, Twitter, Instagram and LinkedIn. This has been
organic growth – we have not paid for advertising|
|**23 sponsors**|Our work is sponsored by most of the main UK utility companies, along with key
stakeholders such as Ofgem and the Energy Systems Catapult. We would like to
thank them for all their support; without them this work would not be possible|
|**2.8**
**staff**
**and**
**6**
**associates**|Our small staff team and network of senior associates with deep expertise in
essential services punch well above their weight|
## **Shaping agendas in essential services for a sustainable future**
In the last year, Sustainability First has made a significant impact in ensuring that the agenda in the energy, water and communications sectors is focused on delivering environmental, social and economic wellbeing, for both today and tomorrow. In 2021 our major Fair for the Future project helped shift the dial on how decision makers in these areas think about their purpose, and maximise public value.
Following analysis for us from law firm Slaughter and May, in early 2021, we held a webinar on how legal and regulatory frameworks in utilities currently deliver sustainability. The answer is that no one should ‘hide behind the law’ and that decision makers have flexibility in how they interpret and implement it. Building on this work and our Fair for the Future primary research from the previous three years, we held a conference in March on ‘Fairness in utilities: What are the implications of public purpose for companies, policy makers and regulators?’
Page 4
## **Sustainability First**
## **Trustees' Report**
This conference launched our major ‘Regulation for the Future’ report which established recommendations about how policy and regulation need to change to deliver sustainability. We have used the conclusions from this extensive research to shape Defra’s Strategic Policy Statement for Ofwat and have shared this with BEIS as they develop the equivalent Statement for Ofgem.
One of our key Fair for the Future proposals has been the need for longer-term planning. In 2021 we worked with Frontier Economics to help them develop a framework for considering the intergenerational impacts of decarbonisation. Our presentation on long-term adaptive planning and regulation has been shared extensively with utility regulators and the water sector, helping shape long term decision making.
Our Fair for the Future research showed that if we are to avoid ‘green wash’ and a silo-based approach to sustainability, we must actively support the cultural change taking place amongst decision makers.
## **Connecting, engaging and inspiring people on sustainability**
To attain transformational and sustainable change, meaningful and enduring public engagement is crucial. In 2021 we stepped-up our engagement agenda. Effective change needs to be done with people rather than to people; we took a different approach to engaging people and organisations in light of the uncertainty and challenges faced.
We had already carried out significant research on ‘established’ engagement mechanisms, culminating in the summer in a report on engagement and public value that we shared with key stakeholders in the energy and water sectors.
To engage further, we have started using art and more creative approaches to engage hearts as well as minds. In the summer we hosted our first art exhibition, on the theme of ‘Reconnecting’ with people and planet around the pandemic, and showcased the fantastic work of Hugo Lamy, our first artist-in-residence who had been working with UKPN in the first lock-down. This was alongside art works from our 2020 Art Prize, exploring how to recover sustainably from the pandemic. The amazing work from Geraint Ross Thomas, our second artist-in-residence, was shown by SSE in their offices during COP26 in Glasgow.
Following the IPCC’s 2021 verdict that we are at ‘code red for humanity’ in terms of climate change, the need for a laser-like focus on net zero is vital. To ensure the transition is fair, and to build social support, engagement is crucial. Throughout 2021 our ‘Together for a Fair Climate Future’ programme worked with younger people, artists, activists and community groups to explore issues around the intersect of social and environmental justice. We are grateful to the Engagement Panel who advised us on this programme.
Our online discussion events looked at key issues such as how we can listen to the voices of the future, what we value in society, whether technology can be a force for good, how we can live more sustainably and what good leadership looks like for a fair climate future. Recognising that individual action is necessary but not sufficient to tackle the climate crisis, we held an inclusive participatory ‘Shake up the system’ conference which explored how to link individual, social, structural and political change.
To complement this activity, we launched our 2021 Art and Writing Prizes on the ‘Together for a Fair Climate Future’ theme. The amazing entries are summarised in our virtual book on the topic and a video compilation of highlights from the discussion series was shared at COP26. We’ve been talking to some of the entrants to the prizes about how we can use their work to address sustainability with more impact.
Page 5
## **Sustainability First**
## **Trustees' Report**
At COP26 we were extremely pleased to participate in Ofgem’s online event for the COP Youth and Public Empowerment Day to announce our joint pilot ‘Sustainable Futures Energy Forum.’ This Forum will seek to give those under-represented in energy decision making - younger people, those from more diverse ethnic backgrounds and those already experiencing climate impacts - a greater voice.
## **Embedding sustainability in practice**
Working together with new stakeholders must lead to action ‘on the ground’ if we are going to build trust in the net zero transition. In 2021 we continued our vital technical work to make sustainability mainstream.
The energy network price controls play a key role in the net zero transition. As a member of the Ofgem Challenge Group for the RIIO price control at the beginning of the year, and through our subsequent consultation responses on price review methodologies and environmental reporting, we helped Ofgem ensure these were firmly focused on net zero and issues such as vulnerability. Since then, we have significantly contributed to consultations on issues ranging from energy efficiency and flexibility to the Future System Operator, raising crucial questions about future systems development and governance.
In the water sector we have made important submissions to Ofwat on customer engagement regarding price controls and the price control reviews, and methodologies in that sector with significant implications for issues including affordability and biodiversity.
In the summer, we celebrated the work of our major Public Interest Advisory Group (PIAG) on smart energy meter data that we have been running with partner the Centre for Sustainable Energy with a major event and final report. We were delighted this was picked up in July by BEIS in their ‘Digitalising the energy system for net zero strategy and action plan’. This accepted our recommendation that DNO data should be used to support wider public interest goals. We are now working with the Energy Systems Catapult to help embed the recommendations in energy thinking in 2022, including in the BEIS Energy Digitalisation Task Force.
## **Building our capacity**
## **Associate and staff changes**
To Spring 2021, we were lucky to continue to have the support of associate Fiona Smith on the Fair for the Future project. We are grateful to Fiona for all her guidance on legal and corporate governance issues for this work.
In the Autumn we were sad to say goodbye to Sonya Peres, our Education and Outreach Officer, and Janine Duffy, our Communications and Engagement Officer. We thank them for all their hard work. We were very pleased to welcome Clare Davidson to our small staff team whose role now combines both education and communications.
## **Trustee changes**
Richard Adams retired from the Trustee Board at the end of December 2021. We thank him for his many years of service and support to Sustainability First.
Page 6
## **Sustainability First**
## **Trustees' Report**
## **Plans for 2022**
• **Enable the transformational shift to sustainability in essential services by supporting decision makers to adopt a principles-based approach to change.** We will work with civil society stakeholders to test our ‘sustainability principles’ framework and strawman to ensure this resonates with their concerns, needs and priorities and is accessible to them in terms of language etc. We will also test this with decision makers against real life problems and use -cases (such as the cost of living crisis, decisions relating to biodiversity and the shift to electric vehicles).
• **Open up energy decision making to currently under-represented groups.** We will establish and run the Sustainable Futures Energy Forum so that this is an effective platform to bring the voice of young people, including people from diverse ethnic backgrounds and people already experiencing climate impacts, into energy decision making.
• **Encourage more radical solutions to the energy crisis.** As the energy crisis and the cost-of-living crisis culminate in a perfect storm, 2022 is proving to be difficult for many people. And decision makers are struggling to respond to the current energy crisis in a strategic way. We will use our in-depth knowledge of the energy sector to embed sustainability, ensuring that affordability does not distract from urgently needed decarbonisation. We will work with others to ensure that energy efficiency is given sufficient long-term strategic funding and will press for deeper social protection for the most vulnerable. Radical solutions to the energy retail market crisis are needed to protect people in vulnerable situations whilst maintaining innovation.
• **Help ensure policy and regulation in the water sector support a sustainable future.** We will work with Defra, Ofwat and the Environment Agency and other key stakeholders to ensure the next water price review delivers more sustainable outcomes.
• **Use art and creative writing to inspire action for a sustainable future.** We will a) Use the entries from our 2021 art and writing prizes on the theme of ‘Together for a fair climate future’ to: reach out to new communities and inspire them to take action for a fair transition; and engage decision makers in utilities about different visions for, and scenarios of, the future. b) Identify a suitable topic for a future art and writing prize (eg biodiversity) and a suitable group of partners who can work together to use the entries to inspire change. We currently have no funding for this work but are currently exploring possible collaborations.
• **Use art to help North Sea communities shape the low carbon transition.** Use our artist residencies in these areas to connect people with issues around the transition so through their visions and images they can help shape their future.
• **Support sustainability education in schools.** Disseminate our COP26 related educational outreach materials with wider teacher and school networks. Evaluate impact. Review utility company educational outreach activity and identify gaps. Make recommendations for future company educational support and collaborative arrangements.
• **Ensure policy and regulatory frameworks support sustainability.** We will respond to consultations and calls for evidence from bodies such as Ofgem, BEIS, the CMA etc to ensure the electricity distribution company price controls and other key decisions deliver sustainable outcomes (eg on net zero).
• **Work with decision makers to ensure that data from energy smart meters is used in the public interest.** Work with Ofgem and BEIS to ensure that the recommendations from our multiparty three year Public Interest Advisory Group on this topic are put into effect.
• **Fair transition.** We will provide strategic advice to the National Grid on the development of their fair transition strategy.
Page 7
## **Sustainability First**
## **Trustees' Report**
## **Team changes**
In 2022, we will be sorry to see our current Director, Sharon Darcy, stepping down. Sharon has led Sustainability First for the last five years and has helped grow the organisation so that it’s impact now spans multiple utility sectors and its engagement work reaches out to creatively involve a much wider range of stakeholders. We won't say goodbye straightaway and Sharon will stay on as a fellow for a while.
We are delighted that our new Director, David Murray, will be joining us full time at the end of April. David brings a wealth of experience from the third sector and wider sustainability issues. We are also extremely pleased that our long-time Associate Zoe McLeod will be joining our small staff team as our first ever Policy Director. Zoe’s expertise and deep sectoral insights will ensure Sustainability First is able to maintain momentum for change at this crucial time for people and planet. David and Zoe, working closely with our fantastic staff and associate teams, will together provide the leadership and vision to take Sustainability First to a new level.
## **Financial review**
Sustainability First reports a net movement in funds for the year ended 31 December 2021 of £96,790 outflow (2020: £88,710 inflow). The income for the year of £258,503 (2020: £406,083) was mainly generated from a series of projects involving research and analysis as described above. Some of these were completed during the year, others were on-going at the end of the year. The total expenditure on charitable activities during the year was £355,293 (2020: £317,373). The reserves carried forward at the end of the period were £305,608 (2020: £402,398). As indicated last year several projects funds which had been received in 2020 were designated for the completion of projects. The trustees also designated funds for the strategic development of Sustainability First. In completing projects and developing the organisation it was necessary to utilise the designated reserves and in the year Sustainability First therefore showed an outflow of funds. The trustees recognise and anticipate that there will be further expenditure out of the reserves to complete the projects that were on-going at the end of the year. The trustees have also decided to designate funds to allow for continuation of the strategic development of Sustainability First by seeking longer term funding from new sources and by building the in-house team delivering its charitable activities and in recognition of the need for support for the incoming director. In recognition of these the trustees have decided to designate £160,500 (2020: £131,000) of General funds to cover delayed project activities (workshops, conferences, travel and sub-contractors) which will be delivered in 2022 and for strategic development. Details will be provided in the Financial Statements to 31 December 2022 in accordance with the United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) and applicable law and regulations at that date. Reserves will also be used to develop new income streams to allow for an increase in the range of activities undertaken by Sustainability First including dissemination, research and communications.
## _**Policy on reserves**_
The trustees of Sustainability First keep the financial reserves for the charity under regular review. The desired level of reserves is discussed by trustees at least annually. Our current aim is to retain sufficient reserves to meet core overhead costs for one year ahead. In line with Charity Commission guidance, Sustainability First will always maintain sufficient reserves to cover core costs for a minimum of six months. The level of Sustainability First reserves is noted each quarter via the finance report to trustees.
At the end of 2021 the level of reserves was £305,608, however as mentioned above £160,500 was designated from the General fund to cover costs to complete projects that were on-going at the end of the year and for strategic development of the Charity. This effectively left General reserves, not designated, of £93,255 which represented 14.3 months' worth of core operating and development costs, other than those covered by designated funds. Whilst this level is higher than the target, the trustees have examined the projected reserves level in years to come and anticipate that the level will reduce as current income sources come to an end and projects are completed and will therefore allow time for the development of new projects and the transition to the new director.
Page 8
## **Sustainability First**
## **Trustees' Report**
## _**Principal risks and uncertainties**_
## _Main risks_
The trustees have reviewed the risks to the charity during the year and have identified the main risks as relating to: key staff and associates (identifying, keeping and dealing with resignation or sudden loss); future projects and project funding; and quality assurance (especially on short-term / one-off pieces of work) contagious disease (including COVID 19), its impact on ways of working, projects and fundraising. New risks identified included the transition to the new director and possible breaches of sponsor confidentiality / IP and breaches of GDPR.
The trustees consider that suitable actions are being taken and controls have been put in place to control and mitigate these risks. These include: maintaining involvement of a range of Associates and having more core staff available; maintaining close dialogue with staff and Associates and developing new personnel and Associates where relevant; ensuring quality control of reports and publications by review processes; developing new ways of working including remote working and regular team discussions on-line and delivering project outputs virtually and increasing the methods of communicating with our audiences, sponsors and the public; continuing to develop new ideas to broaden the reach of our work eg via the essay and art competition, ensuring sponsors remain satisfied with work produced by discussion with them; seeking new sponsors; allocating resources to allow for the strategic development of Sustainability First including its sources of funding and communication strategy; putting in place comprehensive transition support to help the new director establish himself and appointing a new policy director, ensuring all staff and associates are aware of the need for confidentiality relating to IP and GDPR; keeping an up to date register of interests for trustees, staff and associates; ensuring suitable insurance policies are in place; maintaining IT capability to store data safely.
In addition to the review of risks which took place during the year, the trustees considered the various Sustainability First policies and procedures and updated these and added to them to reflect the nature of work undertaken, the wider staff and Associate team and the changes to remote working and engagement. The trustees reviewed the plans for the organisation and regularly considered how these plans needed to be adapted to deal with the impact of COVID 19 and considered what action should be taken as the situation evolved.
## **Implications of COVID 19**
As mentioned above the trustees continued to consider the implications of COVID 19 on the charity and the actions taken to deal with the situation during the year and continue to do so. Some of the implications and arrangements are detailed below.
Staff - at every stage the health and safety of staff has been a priority. Arrangements were made for staff to work from home. Guidance on home working had been issued and regular keep-in-touch arrangements, using virtual meetings in addition to electronic communication, were continued. Due to the nature of the charity’s work and the plans implemented, no staff contracts were affected and no staff needed to be furloughed due to the pandemic.
Meetings - from the start of the first lock down in March 2020 arrangements were made to hold meetings virtually to avoid unnecessary travel by staff, trustees and other stakeholders. The main changes included on-line weekly meetings for staff and associates, conferences and discussion sessions held virtually and, in line with the provisions of the articles of association, holding trustees’ meetings and the AGM virtually.
Impact on the charity’s development during the year and its position at the reporting date - the charity was able to continue to fulfil its various projects successfully. Planned conferences were switched to an on-line format. some new projects were developed and started. Plans were adapted to the Covid situation. The trustees agreed with the director that the time horizon for strategic development should be extended given the impact of COVID 19 and change of director and will continue in 2022.
Page 9
## **Sustainability First**
## **Trustees' Report**
Use of reserves and viability - as mentioned in the accounts, the charity had reserves at the end of 2021 and plans to use part of these to complete existing projects and for strategic development. The trustees have considered that reserves will be sufficient to cover these costs and cover predicted expenditure in 2022 and part of 2023. The trustees have considered the availability of reserves and the on-going plans for the future and are confident that the charity remains viable.
Impact on wider stakeholders - the delivery of projects and our contact with our wider stakeholders have been considered and adapted to the circumstances and restrictions of the pandemic. Use has been made of virtual events and our communications strategy implemented to ensure continued and wider communication with our various stakeholders. When possible some meetings and an exhibition were held in person rather than virtually, recommended COVID 19 precautions were followed.
IT systems and office arrangements - new software and IT systems had been introduced to make communications easier. Our website has been developed and social media programme increased. We decided to temporarily cease the use of office premises in 2020 for staff and meetings and made alternative arrangements. Some ad hoc use of office space for staff meetings was introduced in 2021 during periods when the advice was that it was safe to do so.
On-going review - the director of Sustainability First and the trustees meet quarterly and discussed all aspects of the charity and have kept arrangements to deal with the impact of the COVID 19 pandemic under regular review.
Page 10
Sustainability First
Trustees, Report
Statement of Trn5tee5' Responsibatlits
The tnLStees' (wkn are also the directOf5 of Sustainability First for the purp of ¢4)mY law) are Te5pTrnsible
foi preparing the ttUStee5' rert and final11 ststements in xcordan¢e wÈth the Unitcd Kingdom
Accoullting Standards (United KtThgdom Geoerally ALcepted Accounting Practice) and appliLable law aDd
reguiattons. The report and accounts have been prepared in attor with the pro05 the Companies
Act 21)06 Tratig to small conwaniGs.
Cojnpany law requires the trstees to prepare financial staMents for each financial year. Under COpanY law
the trnstees musl llot approve the fllmncial statements unle&% they salisfied that they give a tTue 2nd fair view
of tbe state of akyairs of the cban"table ComFY alld of its inColg Tesources and applicaiion ol Tesources,
including its income and expenditure. for that periiML In preparing these fjnancial ststements. the InW¢¢s are
r¢quired to:
Se1 suitable ac¢owiting policits and appEy them Co51stend.
obscrve the Tnetlw(ts and principlcs in th¢ Charities SORP:
make judgemcnts and estillte5 are reasonable aThI prudenL
state whether atry)li¢ablc UK Accounting Sthndards have Ixen followeiL subject to any material depar
disclosed and explatncd in the financial statements" alld
PTepare the financial SÈatC[Thts on the going )nCern basis unl$ it i5 tuappropriate to presume that the
charitable company will contiDue itl business.
The tru5tee5 are restK)nsible keeping adequate accounting rccord5 that are sufficieni to sknw athd cxplain the
char]"table eompany's trdllsactiorn8 and disclose with reasollknle at any time the financiai wisitiua of the
cbaritsble LoPaDY and enable thcm to that the financial statements comply wtth the COpanIeS Act
2006. They are also reswbllsfftl)le for safegu&ding the assets ol the cljaritable company and hence for taking
rrdsollable steps fot the prevention and detection of fraud alld Oth ie88r1tlc5.
Small COM]¢$ provision statement
The a[Ual report was approved by the of cknity on 23 M3rth 2022 and sIg[d on its behalf by.
Philip
Trustee
Pagell
## **Sustainability First**
## **Independent Examiner's Report to the trustees of Sustainability First**
## **Independent examiner’s report to the trustees of Sustainability First ('the Company')**
I report to the charity trustees on my examination of the accounts of the company for the year ended 31 December 2021.
## **Responsibilities and basis of report**
As the charity's trustees of the company (and also its directors for the purposes of company law) you are responsible for the preparation of the accounts in accordance with the requirements of the Companies Act 2006 ('the 2006 Act').
Having satisfied myself that the accounts of the Company are not required to be audited under Part 16 of the 2006 Act and are eligible for independent examination, I report in respect of my examination of your charity’s accounts as carried out under section 145 of the Charities Act 2011 (‘the 2011 Act’). In carrying out my examination I have followed the directions given by the Charity Commission under section 145(5) (b) of the 2011 Act.
## **Independent examiner’s statement**
Since the Company's gross income exceeded £250,000 your examiner must be a member of a body listed in section 145 of the 2011 Act. I confirm that I am qualified to undertake the examination because I am a member and Fellow of the Association of Charity Independent Examiners, which is one of the listed bodies. I have completed my examination. I confirm that no matters have come to my attention in connection with the examination giving me cause to believe that in any material respect:
1. accounting records were not kept in respect of the Company as required by section 386 of the 2006 Act; or
2. the accounts do not accord with those records; or
3. the accounts do not comply with the accounting requirements of section 396 of the 2006 Act other than any requirement that the accounts give a ‘true and fair' view which is not a matter considered as part of an independent examination; or
4. the accounts have not been prepared in accordance with the methods and principles of the Statement of Recommended Practice for accounting and reporting by charities [applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)].
I have no concerns and have come across no other matters in connection with the examination to which attention should be drawn in this report in order to enable a proper understanding of the accounts to be reached.
......................................
John O'Brien MSc, FCCA, FCIE, employee of Community Accounting Plus Fellow of the Association of Charity Independent Examiners
Units 1 & 2 North West 41 Talbot Street Nottingham NG1 5GL
04/04/2022 Date:.............................
Page 12
## **Sustainability First**
## **Statement of Financial Activities for the Year Ended 31 December 2021 (Including Income and Expenditure Account and Statement of Total Recognised Gains and Losses)**
|**Note**
**Income and Endowments from:**
Donations and legacies
2
Charitable activities
3
Investment income
5
Total income
**Expenditure on:**
Charitable activities
6
Total expenditure
Net (expenditure)/income
Net movement in funds
**Reconciliation of funds**
Total funds brought forward
Total funds carried forward
12|**Unrestricted**
**funds**
**£**
3,190
254,909
404
258,503
(355,293)
(355,293)
(96,790)
(96,790)
402,398
305,608|**Total**
**2021**
**£**
3,190
254,909
404
258,503
(355,293)
(355,293)
(96,790)
(96,790)
402,398
305,608|**Total**
**2020**
**£**
5,000
400,887
196|
|---|---|---|---|
||||406,083|
||||(317,373)|
||||(317,373)|
||||88,710|
||||88,710
313,688|
||||402,398|
All of the charity's activities derive from continuing operations during the above two periods. The funds breakdown for the period is shown in note 12.
The notes on pages 16 to 23 form an integral part of these financial statements. Page 13
## **Sustainability First**
## **Statement of Financial Activities for the Year Ended 31 December 2021 (Including Income and Expenditure Account and Statement of Total Recognised Gains and Losses)**
## **These are the figures for the previous accounting period and are included for comparative purposes**
|**Note**
**Income and Endowments from:**
Donations and legacies
2
Charitable activities
3
Investment income
5
Total income
**Expenditure on:**
Charitable activities
6
Total expenditure
Net income
Net movement in funds
**Reconciliation of funds**
Total funds brought forward
Total funds carried forward
12|**Unrestricted**
**funds**
**£**
5,000
400,887
196
406,083
(317,373)
(317,373)
88,710
88,710
313,688
402,398|**Total**
**2020**
**£**
5,000
400,887
196|
|---|---|---|
|||406,083|
|||(317,373)|
|||(317,373)|
|||88,710|
|||88,710
313,688|
|||402,398|
The notes on pages 16 to 23 form an integral part of these financial statements. Page 14
Sustainability First
(Registration Dumber: 3897720)
Balance Sheet as at 31 December 2021
2021
2020
ote
Fixed assets
Tangible assets
216
Current *ssets
Dcbiots
Cash ai bank atMI in haud
46J50
4352ll
453,839
493.883
481,561
Creditors: Amounts falling due withiti ont year
Net turreDt assets
io
1188275)
(79.379)
305.608
402.182
Net Sets
305,6A)8
402.398
Funds Df tbe eb*rity:
Unrestricted itrne
Unrestricted
305.608
402,398
To( funds
12
305.608
402J98
For tbe (in¢la1 year enditig 31 tkcemE¢r 2021 thc clwity w&8 entitled to exeiDptson from auth"t uNler srtrtioo
477 of the Ci>mpanies Act 2(X)6 relaiing to SID&
Directors, respO81b11Ities:
The members have tM)t requiwed the clmrity to oi*aiD an audit of its for the year in question
accordanc¢ with section 476: atKI
Th¢ directors acknowledge their rtsponsibilities for complying with th¢ rtquircEnents of the ACE With res1
accounling r¢cords and the pteparation of accounts.
These lllMncial statements have 1cn PT¢pared in accordance with the special provisions lating to compaEJt¢s
subject to the small cthipanics regime withm Part 15 of the Companies Act 2(Ml6.
The financial ststcments on pagc5 13 to 23 appvoved by the tnCe& and autFK)Tised for on 23 March
2022 and signed on betlf by.
David Si
Trustee
The notes OD pagcs 16 to 23 fomi an iiitegrnl part of financial al¢MCn1
Page 15
## **Sustainability First**
## **Notes to the Financial Statements for the Year Ended 31 December 2021**
## **1 Accounting policies**
## **Summary of significant accounting policies and key accounting estimates**
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
## **Statement of compliance**
The financial statements have been prepared in accordance with Accounting and Reporting by Charities: 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)) (issued in October 2019) - (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.
## **Basis of preparation**
Sustainability First meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy notes.
## **Going concern**
The financial statements have been prepared on a going concern basis.
The trustees assess whether the use of going concern is appropriate i.e. whether there are any material uncertainties related to events or conditions that may cast significant doubt on the ability of the charity to continue as a going concern. The trustees make this assessment in respect of a period of one year from the date of approval of the financial statements.
## **Exemption from preparing a cash flow statement**
The charity opted to adopt Bulletin 1 published on 2 February 2016 and have therefore not included a cash flow statement in these financial statements.
## **Income and endowments**
Voluntary income including donations, gifts, legacies and grants that provide core funding or are of a general nature is recognised when the charity has entitlement to the income, it is probable that the income will be received and the amount can be measured with sufficient reliability.
## _**Donations and legacies**_
Donations are recognised when the charity has been notified in writing of both the amount and settlement date. In the event that a donation is subject to conditions that require a level of performance by the charity before the charity is entitled to the funds, the income is deferred and not recognised until either those conditions are fully met, or the fulfilment of those conditions is wholly within the control of the charity and it is probable that these conditions will be fulfilled in the reporting period.
## _**Grants receivable**_
Grants are recognised when the charity has an entitlement to the funds and any conditions linked to the grants have been met. Where performance conditions are attached to the grant and are yet to be met, the income is recognised as a liability and included on the balance sheet as deferred income to be released.
Page 16
## **Sustainability First**
## **Notes to the Financial Statements for the Year Ended 31 December 2021**
## _**Deferred income**_
Deferred income represents amounts received for future periods and is released to incoming resources in the period for which, it has been received. Such income is only deferred when:
- The donor specifies that the grant or donation must only be used in future accounting periods; or - The donor has imposed conditions which must be met before the charity has unconditional entitlement.
## **Expenditure**
All expenditure is recognised once there is a legal or constructive obligation to that expenditure, it is probable settlement is required and the amount can be measured reliably. All costs are allocated to the applicable expenditure heading that aggregate similar costs to that category. Where costs cannot be directly attributed to particular headings they have been allocated on a basis consistent with the use of resources, with central staff costs allocated on the basis of time spent, and depreciation charges allocated on the portion of the asset’s use. Other support costs are allocated based on the spread of staff costs.
## _**Charitable activities**_
Charitable expenditure comprises those costs incurred by the charity in the delivery of its activities and services for its beneficiaries. It includes both costs that can be allocated directly to such activities and those costs of an indirect nature necessary to support them.
## **Taxation**
The charity is considered to pass the tests set out in Paragraph 1 Schedule 6 of the Finance Act 2010 and therefore it meets the definition of a charitable company for UK corporation tax purposes. Accordingly, the charity is potentially exempt from taxation in respect of income or capital gains received within categories covered by Chapter 3 Part 11 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992, to the extent that such income or gains are applied exclusively to charitable purposes.
## **Tangible fixed assets**
Individual fixed assets costing £500.00 or more are initially recorded at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
## **Depreciation and amortisation**
Depreciation is provided on tangible fixed assets so as to write off the cost or valuation, less any estimated residual value, over their expected useful economic life as follows:
**Asset class Depreciation method and rate** IT equipment 33.3% straight line
## **Trade debtors**
Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the charity will not be able to collect all amounts due according to the original terms of the receivables.
Page 17
## **Sustainability First**
## **Notes to the Financial Statements for the Year Ended 31 December 2021**
## **Cash and cash equivalents**
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
## **Trade creditors**
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the charity does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.
## **Fund structure**
Unrestricted income funds are general funds that are available for use at the trustees' discretion in furtherance of the objectives of the charity.
Designated funds are unrestricted funds set aside for specific purposes at the discretion of the trustees.
## **Pensions and other post retirement obligations**
The charity operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the charity. Pension costs charges in the Statement of Financial Activities represent the contributions payable by the charity during the year.
## **2 Income from donations and legacies**
|Donations and legacies;
Donations from individuals
Grants, including capital grants;
Grants from other charities
**3**
**Income from charitable activities**
Membership & sponsorship fees|**Unrestricted**
**funds**
**General**
**£**
3,190
-
3,190
**Unrestricted**
**funds**
**General**
**£**
254,909|**Total**
**2021**
**£**
3,190
-
3,190
**Total**
**2021**
**£**
254,909|**Total**
**2020**
**£**
-
5,000|
|---|---|---|---|
||||5,000|
||||**Total**
**2020**
**£**
400,887|
Page 18
## **Sustainability First**
## **Notes to the Financial Statements for the Year Ended 31 December 2021**
## **4 Grants & donations**
|Nesta Enterprise Ltd
Designit
Sundry donations
**5**
**Investment income**
Interest receivable and similar income;
Interest receivable on bank deposits
**6**
**Expenditure on charitable activities**
Communications
Company secretarial and bookkeeping service
Competition & exhibition costs
Consultancy fees
Depreciation
Donations made
Educational outreach
Insurance
IT consultancy & software
Legal & professional
Meals & catering
Office accommodation
Payroll fees
Prizes
Printing & photocopying
Recruitment expenses
Subscriptions
Sundry expenditure
Travel, meetings & conference costs
Wages, NI & pension|**Unrestricted**
**funds**
**£**
2,000
1,000
190
3,190
**Unrestricted**
**funds**
**Total**
**General**
**£**
**2021**
**£**
404
404
**Unrestricted**
**General funds**
**£**
**Total**
**2021**
**£**
5,345
5,345
17,100
17,100
9,692
9,692
121,934
121,934
216
216
1,000
1,000
1,000
1,000
4,447
4,447
12,360
12,360
663
663
-
-
642
642
488
488
4,900
4,900
892
892
5,606
5,606
3,263
3,263
492
492
16,133
16,133
149,120
149,120
355,293
355,293|**Total**
**£**
2,000
1,000
190|
|---|---|---|
|||3,190|
|||**Total**
**2020**
**£**
196|
|||**Total**
**2020**
**£**
8,230
15,600
-
134,456
215
-
-
3,174
5,767
650
23
7,963
392
3,500
-
1,500
3,302
42
2,537
130,022
317,373|
Page 19
## **Sustainability First**
## **Notes to the Financial Statements for the Year Ended 31 December 2021**
The figures in note 6 represent expenditure made and committed in the year. The trustees have identified £160,500 of expenditure relevant to projects which represent expected costs of delivery of certain projects in future periods which Sustainability First has indicated to sponsors will be incurred and also the costs required for the strategic development of the charity which the trustees have decided should take place in the forthcoming periods. The trustees have chosen to designate these funds accordingly see notes 12 and 13.
## **7 Staff costs**
The aggregate payroll costs were as follows:
|**Staff costs during the year were:**
Wages and salaries
Social security costs
Pension costs|**2021**
**£**
136,209
10,749
2,162
149,120|**2020**
**£**
118,731
9,473
1,818|
|---|---|---|
|||130,022|
The monthly average number of persons (including senior management team) employed by the charity during the year was as follows:
|Average number of employees|**2021**
**No**
4|**2020**
**No**
3|
|---|---|---|
3 (2020 - 3) of the above employees participated in the Defined Contribution Pension Schemes.
Contributions to the employee pension schemes for the year totalled £2,162 (2020 - £1,818).
The number of employees whose emoluments fell within the following bands was:
|£100,001 - £110,000|**2021**
**No**
1|**2020**
**No**
1|
|---|---|---|
The total employee benefits of the key management personnel of the charity were £105,935 (2020 - £105,941).
Page 20
## **Sustainability First**
## **Notes to the Financial Statements for the Year Ended 31 December 2021**
## **8 Tangible fixed assets**
|**Cost**
At 1 January 2021
At 31 December 2021
**Depreciation**
At 1 January 2021
Charge for the year
At 31 December 2021
**Net book value**
At 31 December 2021
At 31 December 2020
**9**
**Debtors**
Trade debtors
Prepayments
Accrued income
Other debtors
**10 Creditors: amounts falling due within one year**
Trade creditors
Other taxation and social security
Accruals
Deferred income||**Computer**
**equipment**
**£**
647||**Total**
**£**
647
647
431
216
647
-
216
**2020**
**£**
31,357
14,233
49
711|
|---|---|---|---|---|
|||647|||
|||431
216|||
|||647|||
|||-|||
|||216|||
|||**2021**
**£**
35,106
4,685
253
-
40,044
**2021**
**£**
6,254
16,693
2,896
162,432
188,275|||
|||||46,350|
|||||**2020**
**£**
23,211
-
16,698
39,470|
|||||79,379|
Page 21
## **Sustainability First**
## **Notes to the Financial Statements for the Year Ended 31 December 2021**
## **11 Charity status**
The charity is a company limited by guarantee and consequently does not have share capital. Each of the trustees is liable to contribute an amount not exceeding £1 towards the assets of the charity in the event of liquidation.
## **12 Funds**
|**12 Funds**||||||
|---|---|---|---|---|---|
|**Unrestricted funds**
**_General_**
General
**_Designated_**
Activities
**Total funds**
**Unrestricted funds**
**_General_**
General
**_Designated_**
Activities
**Total funds**|**Balance at 1**
**January**
**2021**
**£**
271,398
131,000
402,398
**Balance at 1**
**January**
**2020**
**£**
158,688
155,000
313,688|**Incoming**
**resources**
**£**
258,503
-
258,503
**Incoming**
**resources**
**£**
406,083
-
406,083|**Resources**
**expended**
**£**
(355,293)
-
(355,293)
**Resources**
**expended**
**£**
(317,373)
-
(317,373)|**Transfers**
**£**
(29,500)
29,500
-
**Transfers**
**£**
24,000
(24,000)
-|**Balance at**
**31**
**December**
**2021**
**£**
145,108
160,500|
||||||305,608|
||||||**Balance at**
**31**
**December**
**2020**
**£**
271,398
131,000|
||||||402,398|
The specific purposes for which the funds are to be applied are as follows:
The Designated activities fund is to cover strategic development of Sustainability First and activities (workshops, conferences, travel and sub-contractors) which will be delivered in future periods.
Page 22
## **Sustainability First**
## **Notes to the Financial Statements for the Year Ended 31 December 2021**
## **13 Analysis of net assets between funds**
## **Unrestricted**
|Current assets
Current liabilities
Total net assets
Tangible fixed assets
Current assets
Current liabilities
Total net assets|**General**
**£**
**Designated**
**£**
333,383
160,500
(188,275)
-
145,108
160,500
**Unrestricted**
**General**
**£**
**Designated**
**£**
216
-
350,561
131,000
(79,379)
-
271,398
131,000|**2021**
**Total funds**
**£**
493,883
(188,275)|
|---|---|---|
|||305,608|
|||**2020**
**Total funds**
**£**
216
481,561
(79,379)|
|||402,398|
## **14 Fees payable to independent examiner**
During the period, the fees payable (excluding VAT) to the charity’s independent examiner Community Accounting Plus are analysed as follows:
|Accounting Plus are analysed as follows:|||
|---|---|---|
|Independent examination
Other financial services|**2021**
**£**
650
488
1,138|**2020**
**£**
650
392|
|||1,042|
## **15 Taxation**
The charity is a registered charity and is therefore exempt from taxation.
## **16 Trustees remuneration and expenses**
No trustees, nor any persons connected with them, have received any remuneration from the charity during the year.
No trustees have received any reimbursed expenses or any other benefits from the charity during the year.
## **17 Related party transactions**
There were no related party transactions in the year.
Page 23