micaia micaia Report of the Trustees 2022 Micaia Report of the Trustees For the year ended 31 December 2022 ## **LEGAL AND ADMINISTRATIVE INFORMATION** **Trustees** Dr Sandy Ochojna (Chair) Prof. Daniel Brockington Christopher Bowes Dr Isilda Nhantumbo Laura Gilbert (Treasurer) Milagre Nuvunga Prof. Philip Woodhouse **Secretary** Andrew Kingman **Principal staff** Andrew Kingman, Director **Registered office and operational address** 13 Windsor Road Buxton Derbyshire SK17 7NS 01298 24248 www.Micaia.org info@Micaia.org **Charity registration number** 1120413 **Independent Examiner** Lindsay Johnston, FCA (retired) **Bankers** Royal Bank of Scotland The Square Bakewell Derbyshire DE45 1BT 2 Micaia Report of the Trustees For the year ended 31 December 2022 **The Trustees of Micaia UK** present their report and the financial statements for the year ended 31 December 2022. Legal and administrative information set out on page 1 forms part of this report. The financial statements are prepared on an accruals basis. In 2022 the income of the charity was not above £250k and the total assets (before liabilities) of the charity do not exceed £3.26 million, therefore the annual accounts are subject to an independent examination, rather than an audit. ## **Objectives and activities** Micaia’s mission is to help Mozambique prosper - sustainably and inclusively, with all people capable of and supported in securing their own well-being. In pursuing its mission, Micaia is developing and testing a coherent ‘localization’ approach to economic and social development. This responds to the various ways in which (economic, social, cultural, environmental, and spiritual) people we work with define ‘prosperity’ or wealth. The approach frames Micaia’s values of creating social and economic fairness for poor people, creating opportunities for people to build assets, empowering people through building better skills knowledge and confidence, and working for an enabling policy and investment environment. Micaia UK’s principal activities include: - a) Technical support for the development of operational programmes in Mozambique implemented by Micaia Foundation based in that country. - b) Provision of personnel including paid staff and volunteers to support development programmes in Mozambique - c) Research into issues relevant to Micaia’s programmes - d) Dissemination of case studies, reports and other educational material resulting from the practical work of Micaia and its partners in Mozambique - e) Participation in policy networks and other forums relevant to Micaia’s mission - f) Raising and managing funds to support the work of Micaia in Mozambique. ## **Purpose, structure and governance of the charity** Micaia is an international non-governmental, non-political, non-religious organisation created as a charitable legal entity in the UK. Micaia UK was registered as a charity on 7th August 2007. The organisation was established under a Constitution, which established the objects and powers of the charity. The Constitution defines the Charity’s ‘Objects’ as being: 1. To promote sustainable development for the benefit of the public by: (a) the relief of poverty and the improvement of the conditions of life in socially and disadvantaged communities of Mozambique; 3 Micaia Report of the Trustees For the year ended 31 December 2022 (b) the promotion of sustainable means of achieving economic growth and regeneration in rural and urban communities of Mozambique; (c) the preservation, conservation and the protection of the natural resources and wider environment of Mozambique and the prudent use of its resources. 2. To advance the education of the public in subjects relating to sustainable development and the protection, enhancement and rehabilitation of the environment and to promote study and research in such subjects provided that the useful results of such study are disseminated to the public at large. Sustainable development means “ _development which meets the needs of the present without compromising the ability of future generations to meet their own needs._ ” Micaia UK is governed by a Board of Trustees (currently 7, including the Chair). The charity is UK based with its registered office and administrative centre in Buxton. The Director is currently seconded to Micaia in Mozambique, working both with Micaia’s sister organization, the Micaia Foundation (Reg. 100094525) and the linked social enterprise, Eco-Micaia Ltd (Reg. 400168105). ## Organization The charity is governed by its board of Trustees which convenes at least three times a year in the UK. Day-to-day management of the charity is delegated to the Director. ## Risk management The Trustees developed a risk management framework based on guidance from the Charity Commission. Trustees review this framework and the general risk management policy on an annual basis. ## Safeguarding Within the Micaia ‘family’, Micaia UK took the lead in developing Micaia’s policy on Safeguarding, using best practice from UK experience and guidance. The Board has continued to lead in ensuring that Safeguarding is to the fore at all levels throughout the organization. ## **Achievements and performance Micaia: institutional development** In the course of 2022 Micaia UK continued to play a role in supporting the institutional development of Micaia as a whole. This included active participation with the Micaia Foundation Board in opening an office in the capital, Maputo, to better support the acitivites of its established operating base in Chimoio. This move, in conjunction with the UK Director developing plans for expanded engagement with Micaia in the UK, represents the Boards’ collective efforts to balance operational work with more involvement in policy, 4 Micaia Report of the Trustees For the year ended 31 December 2022 research and funding. Micaia UK also supported and co-chaired Micaia’s Research Working Group. - Micaia UK’s support for Mozambique continued to focus on four main areas: - a) Securing additional funding for natural product value chain development and the Natural Product Enterprise Centre - b) Further developing Micaia’s capacity to add value to practical work in Mozambique by engaging proactively in policy and research networks in the UK and elsewhere that are relevant to Micaia’s work - c) Further developing Micaia’s organizational and institutional capacity, with particular attention given to establishing a UK fundraising platform and improving marketing and communications - d) Advising on the further development and implementation of Micaia’s Safeguarding policies and procedures ## _**Maintaining an active Board**_ Micaia UK is supported by the volunteer activities of its Board. In addition to the meetings of the Board, almost always attended by all Members, individual Trustees continued to take on specific tasks agreed at Board Meetings or as part of continuing operations. These activities included banking and financial management, keeping abreast of UK charity law and requirements, promoting the organisation, organizing events, research, and representing Micaia at meetings. ## _**Engaging in the governance of the Micaia ‘Family’**_ Through the year, the Chair of the UK Board maintained monthly contact with the Foundation Board’s representatives, monitoring in particular the security situation in Mozambique, and the progress of the Micaia ‘family’ in relation to its annual Operating Plan. The UK Chair also received and commented on papers presented to the Micaia Foundation Board Meeting.The UK Chair and Vice-Chair participated in the monthly interboard ‘Steering Committee’ skype meetings. These monthly meetings follow a standard agenda that incorporates security, safeguarding, reputation management, personnel issues, finance, and headlines from projects and other actions in Mozambique. The Minutes of the Steering Committee meetings are shared with all Micaia board members. Micaia UK’s Treasurer continued to support the financial management and planning of Micaia in Mozambique, advising on management accounting and other financial systems. ## _**Supporting Eco-Micaia Ltd and its investments**_ Eco-Micaia Ltd is a company registered in Mozambique and operates as part of the Micaia ‘group’. It shares the same overall purpose and strategic plan as Micaia UK and Micaia Foundation. It was created in 2007 to provide a vehicle for services and investments in value chains and socially responsible businesses, community ventures and other marketoriented actions that could create livelihood opportunities for suppliers, producers and workers. Since the end of 2016, Micaia (UK) has been a shareholder in Eco-Micaia and Dr Sandy Ochojna is the Trustee appointed to the Eco-Micaia Board of Directors to represent Micaia 5 Micaia Report of the Trustees For the year ended 31 December 2022 (UK). During 2022, Dr Ochojna has been closely engaged in supporting the management and governance of Eco-Micaia. This included, _inter alia:_ - a) maintaining close contact with the Director via email and skype calls, discussing issues as they emerge and reviewing internal discussion papers, proposals etc. - b) reviewing monthly narrative reports and accounts from Eco-Micaia and the subsidiary companies in Mozambique (Baobab Products Mozambique, Ndzou Camp, and Mozambique Honey Company) - c) taking the lead in presenting at the UK Board meetings, and on the monthly interboard calls, summary reports on the status and performance of the companies - d) participating in online Board of Directors’ meetings ## _**Marketing and communications**_ Micaia UK intends to expand its role in marketing, communications and fundraising. Having established Micaia’s presence on People’s Fundraising in 2021, Micaia UK focused on using its social media presence to promote links to Micaia’s pages and appeals on the site. ## **Programmes** Micaia’s programmes are focused entirely on Mozambique. All programmes link with one of the four ‘pillars’ that provide the framework to Micaia’s strategic plan. The four ‘Pillars of Prosperity’ aim to support and develop: a) Food security and the local food economy; b) Active citizenship; c) Sustainable management of natural resources; d) Diverse and inclusive local economies. In 2022, Micaia continued to support work led by Micaia Foundation in the north of Manica Province in the districts of Guro and Tambara. Since 2016, Micaia has focused much of its support on work relating to promoting livelihoods based on natural products. With support from a private family foundation, Micaia launched a new phase of work in this landscape. The project is entitled: _**From vulnerability to resilience**_ . As with the previous project supported by the family foundation, while the grant agreement is between Micaia Foundation in Mozambique and the funder, Micaia in UK received the funds and managed the onward grants to Micaia in Mozambique. The work done by Micaia Foundation since 2016 has created new opportunities: increased sources and scale of income for women in particular (from selling baobab fruit); fostered a better understanding of natural resources and the risks to these of unsustainable extraction; and encouraged merging and stronger community organizations. The successes of the programme have led to other funding being secured by the Foundation for work in the area. This funding includes support for the construction of dams that will then backfill with sand that stores water into the dry season when the watercourse runs dry, and support for baobab collectors and their Association. The problem to be addressed in the new project is how to scale up and sustain the benefits of the work done to date; put another way, how to help people reduce their vulnerability and, as families and communities, become more resilient. 6 Micaia Report of the Trustees For the year ended 31 December 2022 The project expands the area of intervention across what Micaia refers to as the Lower Zambezi Valley, incorporating Guro and Tambara districts along with Changara District of Tete Province. The goal of the project is to help people strengthen their communities’ resilience (particularly adaptability and resilience in the face of climate change) and, in so doing, to inspire and facilitate change in neighbouring Districts sharing similar characteristics. The project is holistic in design and approach, mirroring the four Pillars at the heart of Micaia’s strategy. One component focuses on sustainable agriculture and aims to enable 5,000 families to learn about and implement more sustainable agricultural systems. A second component focuses on natural resource management and aims to facilitate in 26 communities of Guru and Tambara Districts, and 7 communities of Changara, the creation and implementation of Land and Natural Resource Management Plans. The third component maintains Micaia’s core focus on livelihood diversification and natural products and aims to enable 3,000 families to increase household income by participating in at least one non-timber forest product value chain. Finally, a fourth component on human development seeks to enable 1,000 women and 500 men to build literacy and numeracy skills according to their own priorities and, in so doing, establish and pilot a new approach to integrating functional literacy and numeracy in livelihoods and life skills. Binding all of these actions together, the Micaia team hopes to facilitate the development, with community partners, of district-level ‘Community Resilience Associations’ in each of Guru and Tambara Districts, creating a longer-term model which Micaia Foundation can introduce into other Districts. Our strategic aim is to support community-led development and make more effective use of the many resources that exist in communities throughout the area in which Micaia operates. In 2022, while continuing with villages already introduced to the project in its first and second years, the small field team continued to expand the reach of the project, working in a total of 21 communities (a traditional area often including several small villages). In sustainable agriculture the Micaia Foundation Field Officer worked with a total of 126 villages, and in 51 ‘new’ villages, additional lead farmers were identified. By the end of the year 500kg of maize seed, 500kg sorghum seed and 102kg of Bambara nuts seed was distributed to lead farmers for the setting up of demonstration plots for the agricultural season 2022/23. For the capabilities “learning for life” program the team worked with a total of 37 facilitators distributed across 27 villages, of which 10 are new. In adult literacy, the team worked in 20 villages. The areas in which the project is implemented are very dry, and the project’s focus is therefore on trying to encourage farming methods that can cope with the conditions and avoid making the situation worse by further clearance of forest. During the year, 2,171 men and 2,433 women farmers participated in some form of training. After two years’ of focusing on sustainable agriculture, the first theme of the project, interesting stories of change are emerging. For example, during distribution of seed, the team discovered that some farmers have become interested in setting an example to their fellow farmers by showing what they have learnt from their lead farmers. When the village’s Lead Farmer left Nhachecha village in Tambara District to move to town, another farmer, Antonio Denja, 7 Micaia Report of the Trustees For the year ended 31 December 2022 volunteered to open another demonstration plot in his land so that his neighbours can also have the opportunity to learn from his experience. In Nhaphenda village, the traditional leader, after the training he received, decided to follow the lessons learnt and advised his four wives to do the same, but they all refused. As each wife is responsible for her own production, he didn’t persist in making them change their minds. In his farm he neither swept nor burned the dry organic matter found (grass, leaves, maize and sorghum stems, etc.) whilst the four wives continued to use their traditional farming methods. During the monitoring visits to the community, the leader proudly showed how his seeds had germinated, while most of the areas cultivated by his wives were not successful. The women told Micaia’s field officers that in the new season they too will apply the ‘new’ methods. One of the main challenges faced is the increasingly irregular pattern of rains within the region. This has affected the production yields of the communities with a negative impact on food security. Relating to this major challenge, the second theme of the project is natural resource management and governance. The principles of community governance were introduced by the Micaia team in communities across the focus districts. This includes setting up Natural Resource Management Committees, creating a management plan, and, in theory, ensuring that the plan is implemented. However, the Committees have no resources with which to incentivise community forest ‘rangers’ who can monitor natural resource access and use and report abuse. While the Law states that communities with a Natural Resource Management Committee are entitled to 20% of tax paid by investors/extractors in relation to material sourced in that community the reality is that unless and until the communities start to see some such returns, people are not motivated to work. Natural Resource Management Plans remain as papers only, not as guides to sustainable use of available resources, and of sanctions to apply if local people (and outsiders) fail to follow the rules. Micaia’s hope is that the stress on principles and benefits of community governance will begin to change this situation, especially as people do complain about the rate of degradation. There are some positive signs. For example, as a result of the sensitization define sessions, one community in Guro District, set up a small tree nursery that would serve for producing tree seedlings for the reforestation of their forest. In the same community the leader worked on revitalizing the natural resources management committee that was created during the extraction of timber some years ago. The third theme in the project is diversification of economic livelihoods. Micaia continues to work with baobab, seeking to expand the value chain and increase the number of women who benefit, and the range of benefits. In the preparation phase for the 2022 harvest, a record 3,150 women registered and trained to sell baobab fruit to Baobab Products Mozambique (BPM), the social enterprise set up and managed by Eco-Micaia Ltd. This reflects the growing awareness that BPM pays 3-4 times as much for baobab than the informal traders do. Although the baobab value chain work is led by BPM, the Micaia field team play important supporting and coordinating roles, particularly regarding the selection and support (training) of Lead Collectors and representatives of the Baobab Association. Other than baobab, the Micaia team conducted research into the extent of marula in the area, knowing that there is a very good international market for marula oil. If additional funding can be sourced, there is a plan to do a pilot production of the oil in 2024. Also, the team supported field trials of Bambara Nut production. This bean, that grows like groundnuts, is highly nutritious and has great potential in both the national and 8 Micaia Report of the Trustees For the year ended 31 December 2022 international market. The Micaia team identified 17 lead farmers within the districts of Guro and Tambara interested in producing Bambara nuts and all were given 6kg each. After the harvest the nut will be used to test the buying process where the cost of the seed will be deducted so that the farmers will understand that this is a business, and each farmer has to be responsible for getting all the necessary inputs when producing nuts for the future value chain. The plan is to then expand production. The fourth theme in the project is ‘capabilities’, a broad programme of non-formal learning that encompasses literacy and numeracy, as well as ‘learning for life’. In the year 756 community members (681 women) registered for the programme. Training of trainers and training of _learning for life_ facilitators was conducted in the April by a British consultant, hired by Micaia to help the team set up the adult literacy program. The consultant also conducted an online workshop in which government officials from the education department participated. In this workshop the participants analysed the principles of adult literacy and the strategy that Micaia would use for this programme. Many of the women participating in the programme are baobab collectors, and for them (almost all of whom were unable to read or even write their name), the literacy and numeracy work was seen as a strategy for boosting their livelihood. Most women in these classes concentrated their time in learning more about their main activity (baobab business) and on how to do simple calculations related to the weighing and pricing of their product. Encouragingly, the number of collectors who can write their own names has increased. Of the 306 women that completed the year’s programme, 47 really improved their writing skills, whilst the rest are now able to write their names and read numbers. This helped in guaranteeing that each collector was able to sign her name for each transaction done during the buying process which reduced the risk of falsification. ## **Research linkages** In 2022, Micaia maintained its links with the universities of Sheffield and Edinburgh. Micaia Foundation and University of Edinburgh, along with Maputo’s University of Eduardo Mondlane, were successful in a bid to the UK’s Darwin Initiative. Although Micaia UK is not directly involved in the project, the UK Director is part of the management team on the project and is in close contact with the lead researcher from Edinburgh. Micaia UK Board members participate (and one Chairs) the Micaia Research Working Group, set up to guide the development of the overall Micaia research agenda. ## **Fundraising** Micaia UK continues to be the most likely source of general or unrestricted funding for Micaia in Mozambique and for the last few years the Board has been exploring possible ways of expanding UK-based fundraising. The lack of staff capacity in UK has limited the practical possibilities. In 2022 Micaia agreed with Micaia Foundation a new strategy for senior management to spend more time in the UK to support meetings with potential donors. The first stage of this plan – enabling the senior managers to step back from dayto-day engagement in the field – was implemented successfully. In 2023, we expect the UK Director to be based more in the UK. This will facilitate the development of a UKfocused fundraising strategy. 9 Micaia Report of the Trustees For the year ended 31 December 2022 ## **Financial review** Micaia received income of £159k in 2022 compared with £202k in 2021. The majority (£125k) was restricted funding from the family foundation grant. Micaia also received a small amount of interest income and donations. Expenditure was £186k in 2022, in-line with 2021. Micaia’s reserves at 31[st] December were almost entirely restricted, however further, modest unrestricted donations have been received in 2023 to build up the general fund again. ## **Plans for the future** Micaia will seek to expand its ability to support work in Mozambique and to share learning from that work with a wide network of practitioners and policymakers. Micaia’s key objectives for 2023 are: - Scale up UK fundraising, with particular reference to a) general (unrestricted) funding and b) the new specific appeals (scholarships, youth farm and Ndzou Camp eco-camp) - Complete the overhaul of Micaia’s communications (policy, strategy, tools) - Plan and support the more regular and extensive presence in the UK of Micaia’s founding directors ## **Statement of responsibilities of the trustees** The trustees are required to prepare financial statements for each financial year, which give a true and fair view of the state of the affairs of the charity and the incoming resources and application of resources, including the net income and expenditure, of the charity for the year. In preparing those financial statements, the trustees are required to: - select suitable accounting policies and apply them consistently; - make judgements and estimates that are reasonable and prudent; - state whether applicable accounting standards and statements of recommended practice 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 in operation. The trustees are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the charity. The trustees are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of accounting errors, inappropriate use of funds, fraud and other irregularities. 10 Micaia Report of the Trustees For the year ended 31 December 2022 Members of the charity guarantee to contribute an amount not exceeding £1 to the assets of the charity in the event of winding up. The total number of such guarantees as at 31 December 2022 was 7. The trustees are members of the charity, but this entitles them only to voting rights. The trustees have no beneficial interest in the charity. ## **Public Benefit** The Trustees regularly review Micaia’s work to ensure that the charity continues to meet public benefit criteria. The Trustees are satisfied that Micaia delivers public benefit. Measures to verify this conviction include the continuing role of Micaia’s UK Director in directly supporting work in Mozambique and reporting quarterly to the Board, and the independent evaluations of projects that take place. ## **Auditors** Micaia UK does not yet need to have an audit. An Independent Examiner was appointed and conducted an examination of the 2022 Micaia UK accounts. The Trustees also note that Micaia Foundation, our lead partner in Mozambique, has a full independent audit of its annual accounts. Similarly, the evaluation of specific projects incorporates financial review, and Micaia has been subject to due diligence processes by its key funders including AFD Approved by the trustees on 03/12/23 and signed on their behalf by Dr Sandy Ochojna – Chair 11 M￿Allu￿ Annual a¢¢¢uni$ for the CC17a Section A StateTnent of financial activities I￿ly$ Tol11￿$y• Total l*$tWr In¢omknpr•¥our¢•s (Nole $1 F02 F04 15F.5D4 15D.387 fund T0taJtncomlngy8sQlMC￿ 5J5 15T.5D4 239 163288 Tot4lr•soLwc•s•xp•nd•d $13 349 185S30 188838 rn50￿*QfQrQtrI￿5r￿s $1 28.026 or￿ tr4n¥f•rs b•t¥YMnfvr 28026 Othei M¢ognlsed galnsllhs$vsI 51S 2B.026 81.6 .441 Tot￿f￿th b[￿u￿htf[￿wllrd To¢alfundsc￿riEdIU￿V￿fd 511 53.5&2 Cc17BIExL￿1l LW12rthrJ Section B Balance sheet EhduWMDhif￿￿Lts T1￿1th15Y￿a Tn ot charty accaunts dir6CIK¥J6 guthnce lar examir*s1. Gfv• h•r• brlef detsll8 of any it•m• thatth• •¥amingr to IER Oct 2018