OpenCharities

This text was generated using OCR and may contain errors. Check the original PDF to see the document submitted to the regulator.

2020-12-31-accounts

CLIMATE BONDS INITIATIVE

TRUSTEES’ REPORT AND CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31 DECEMBER 2020

1

CLIMATE BONDS INITIATIVE

CONTENTS

Page
Charity Reference and Administrative Details 2
Report of the Trustees 3 – 8
Report of the Independent Auditor 9 – 12
Consolidated Statement of Financial Activities (including the
Income and Expenditure Account) 13
Balance Sheets 14
Consolidated Statement of Cash Flows 15
Notes to the Financial Statements 16 - 30

CLIMATE BONDS INITIATIVE

CHARITY REFERENCE AND ADMINISTRATIVE DETAILS

Trustees Mr Nicholas Silver (Chair)
Mr Paul Bodnar (appointed 24 March 2020, resigned 25 April 2021)
Mr Simon Cooper (appointed 24 March 2020)
Ms Doris Honold (appointed 6 October 2020)
Dr Karl Mallon
Mr Bryan Martel
Prof Cynthia Williams
CEO Mr Sean Kidney
Company Number 07455730
Charity Number 1154413
Registered Office 72 Muswell Hill Place
London
N10 3RR
Bankers HSBC UK Bank plc
1 Centenary Square
Birmingham
B1 1HQ
Auditor PKF Littlejohn LLP
15 Westferry Circus
Canary Wharf
London
E14 4HD

2

CLIMATE BONDS INITIATIVE

REPORT OF THE TRUSTEES

The Trustees are pleased to present the audited consolidated Financial Statements of Climate Bonds Initiative (‘CBI’, 'the Charity') together with the annual report for the year ended 31[st] December 2020. The Financial Statements have been prepared in accordance with the Statement of Recommended Practice – Accounting and Reporting by Charities (FRS102).

The Trustees confirm that the Annual Report and Financial Statements of CBI comply with the current statutory requirements, the requirements of CBI’s governing document and the provisions of the Charities Act 2011, Accounting and Reporting by Charities: Statement of Recommended Practice (SORP) (applicable from 1[st] January 2019).

CBI qualifies as small under section 383, the strategic report required of medium and large companies under the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 is not required.

Objectives and Activities

The objectives of the Charity are the preservation and conservation of the environment (in particular but not exclusively) by:

In summary, the Charity carries out the following general activities in direct support of the objectives:

1. Advocacy – to encourage and enthuse the global financial community, industries and governments to support a rapid transition to a low carbon and climate resilient economy.

2. Capacity-building and training – for the wide range of stakeholders including governments to actively participate and help drive the development of the green bonds market and other climate-related finance.

3. Stakeholder engagement and events – to create awareness and knowledge of opportunities in financing a rapid transition to a low carbon and climate resilient economy, including in the green bonds market and trends for future growth.

In more detail, the activities that the Charity carries out to support the accomplishment of these objectives are organised under the following seven work streams:

1. Standards – develops Paris-aligned, sector-specific, science-based criteria for the Climate Bonds Standard, which serves as a tool for investors to assess the credibility of green bonds globally. The team manages and coordinates a team of independent experts in the development of the criteria for key sectors, from the initial scientific analysis through to the finalisation of internationally accepted definitions of the Climate Bonds Standard.

2. Certification – manages the application of the certification label for green bonds that have been independently verified to be in compliance with the Climate Bonds Standard.

3. Market Intelligence – monitors and reports on outstanding bonds where proceeds are going to climate change solutions globally and provides commentary on the environmental relevance of underlying assets and projects linked to green bonds, with a view to shaping global markets towards climate solutions.

4. Policy – policy analysis and proposals for Governments, financial sector regulators and other public sector bodies that will foster the growth of climate-related finance, including the green bonds market.

5. Partnerships – engagement, education and support for investors, banks and others to promote capital flows to climate action, through access to green bond data and analysis and through collaborative activities.

6. Market development – government and financial sector regulator support and investor education around the world.

7. Communications and Media – external communications, media relations, brand and public profile.

3

CLIMATE BONDS INITIATIVE

REPORT OF THE TRUSTEES

Public Benefit Statement

The Charity has regard to the guidance on public benefit published by the Charity Commission.

Climate change is an enormous worldwide challenge that will affect nations, communities and societies. Addressing that challenge requires huge levels of financing immediately, as well as in the near to medium future. Climate and green bonds have the potential to make a major contribution to that financing. For the climate bonds market to grow, investments need to be underpinned by confidence in the green credentials of bonds. The Charity manages the Climate Bond Standard which plays a vital role in ensuring that confidence.

Details of activities in furtherance of public benefit are set out in this report.

Principal Risks and Uncertainties

The Trustees have assessed the major risks that the Charity faces in relation to its operations and finances and are satisfied that the Charity is taking the action necessary to mitigate its exposure to these risks. A risk assessment register is updated on a regular basis.

The main risks and uncertainties facing the Charity relate to:

Achievements and Performance

Review of activities in the year

Most of 2020 was marked by the COVID-19 pandemic. CBI quickly closed its London office and moved all activities online.

The main activities in the year included:

4

CLIMATE BONDS INITIATIVE

REPORT OF THE TRUSTEES

Amongst others, the Charity has carried out high level collaborations with:

The primary impact of the Charity has been in helping to promote and support the rapid growth that has occurred since 2015 in green bond markets around the world.

Key Performance Indicators (KPI’s)

Financial Review

For the year ended 31 December 2020, the Charity had income of £3.6m (2019: £3.6m) and incurred expenditure of £3.2m (2019: £3.6m).

CBI’s success continues to be built upon the breadth and depth of relationships with investors, banks and others as well as extending the geographical reach of the organisation's work.

CBI’s unrestricted surplus for the year 2020 was £282k (2019: £88k).

Net assets of the Charity at the year-end amounted to £304k (2019: Net liabilities of£102k).

Restricted income recognised in the year has been spent with a £130k (2019: £7k) carry forward balance.

The Trustees note that the numbers are improving, with a clear trend in the right direction. Definitive plans are in place to further to improve the financial health of the Charity in the coming years.

5

CLIMATE BONDS INITIATIVE

REPORT OF THE TRUSTEES

Reserves policy

The Board has agreed that the Charity, in addition to any restricted reserves and commitments to, and investment in, tangible fixed assets, should aim to have unrestricted free reserves of at least three months of current total unrestricted expenditure so that the Charity's activities could continue in the event of any significant short-term funding shortfalls.

Unrestricted reserves at the year-end showed a surplus of £173k (2019: deficit £108k). On the foregoing basis, this represents a shortfall in expected minimum net free reserves of approximately £400k (2019: shortfall £664k). As a result of continuing specific actions to address the shortfall in net free reserves during the year, the Board is hopeful that the trajectory towards full compliance with the reserves policy is well underway.

Future Plans

The Charity plans to continue the growth of its activities significantly in the coming years: the global consequences are too great not to do so.

Having driven global understanding and definition of “green” in the financial and regulatory markets, through the implementation of a clear taxonomy and science-based sector criteria, as well as expanding this work, CBI will now focus on enforcing the pathway from “brown” to “green”, by defining and policing ambitious net zero trajectories.

The Charity’s three-year strategy is as follows:

Post Balance Sheet events

CBI continues to attract significant levels of funding for its work. Most notably, in April 2021, the Charity secured a grant of £3 million over three years from the Children’s Investment Fund Foundation (CIFF) as a keystone funder of its Transition programme. Across the pipeline more generally, there is an encouraging and widespread level of support for our work, and we expect the financial year 2021 to demonstrate substantial growth of both revenue and impact.

6

CLIMATE BONDS INITIATIVE

REPORT OF THE TRUSTEES

Structure, Governance and Management

Climate Bonds Initiative is a company limited by guarantee and a registered charity. The Charity's memorandum and articles of association are its primary governing documents. The Trustees of CBI are also the directors of the charitable company for the purposes of company law. CBI has a wholly owned subsidiary, Climate Bonds Services Limited, which is included in the consolidated financial statements.

Details of the Trustees who served during the year are included in the Reference and Administrative Details on page 2.

Trustees

Trustees are elected by recommendation from existing charity trustees and by confirmation by the Chair of the Board. An appropriate vetting process is overseen by the Chair.

CBI appoints and recruits new trustees Decisions through its wide network of supporters, bearing in mind skills required. The overall performance of the charity is the responsibility of the Board, but day-to-day decision-making is delegated to the Senior Management Team (SMT) Key strategic direction and major issues of policies and procedures are set by the board for implementation by the SMT. The induction and training of trustees is handled through a serous of individual meetings with key personnel, and cire documentation is provided for review.

The Board sets the pay of the CEO and DCEO and provides guidance for setting pay and remuneration for other senior staff.

Key management personnel

The key management personnel of the group consist of the Trustees, the Chief Executive Officer and DeputyChief Executive Officer:

In addition, the following served on the Senior Management Team:

Related parties

See note 21.

7

CLIMATE BONDS INITIATIVE

REPORT OF THE TRUSTEES

Trustees’ Responsibilities in Relation to the Financial Statements

The Trustees (who are also Directors of the company for the purposes of company law) are responsible for preparing the Trustees’ Report and the Financial Statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law requires the Trustees to prepare Financial Statements for each financial year which give a true and fair view of the state of affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing these Financial Statements, the Trustees are required to:

The Trustees are responsible for keeping adequate accounting records that 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 charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Disclosure of Information to the Auditors

We, the Directors of the charitable company who held office at the date of approval of these Financial Statements as set out above, each confirm, so far as we are aware, that:

Auditor

PKF Littlejohn LLP was appointed as auditor during 2020 and have indicated their willingness to continue in office.

This report is prepared in accordance with the small companies’ regime under the Companies Act 2006.

Approval

This report was approved by the Board on 27 May 2021 and signed on its behalf.

Nicholas Silver, Trustee

8

CLIMATE BONDS INITIATIVE

REPORT OF THE INDEPENDENT AUDITOR YEAR ENDED 31 DECEMBER 2020

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS AND TRUSTEES OF CLIMATE BONDS INITIATIVE

Opinion

We have audited the financial statements of Climate Bonds Initiative (the ‘parent charitable company’) and its subsidiaries (the ‘group’) for the year ended 31 December 2020 which comprise the Consolidated Statement of Financial Activities, the Balance Sheets, the 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 FRS 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:

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 and parent charitable company 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 group’s or parent charitable company'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 other information comprises the information included in the report of the trustees, other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other information contained within the report of the trustees. Our opinion on the financial statements does not cover the other information and 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 course of 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.

9

CLIMATE BONDS INITIATIVE

REPORT OF THE INDEPENDENT AUDITOR YEAR ENDED 31 DECEMBER 2020

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and parent charitable company and their environment obtained in the course of the audit, we have not identified material misstatements in the directors’ report included within the trustees’ annual report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 and the Charities Act 2011 requires us to report to you if, in our opinion:

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 group and parent charitable company 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 group and parent charitable company financial statements, the trustees are responsible for assessing the group and parent 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 group or the parent charitable company or to cease operations, or have no realistic alternative but to do so.

10

CLIMATE BONDS INITIATIVE

REPORT OF THE INDEPENDENT AUDITOR YEAR ENDED 31 DECEMBER 2020

Auditor’s responsibilities for the audit of the financial statements

We have been appointed auditor under the Companies Act 2006 and section 151 of the Charities Act 2011 and report in accordance with those Acts and relevant regulations made or having effect thereunder.

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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

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.

11

REPORT OF THE INDEPENDENT AUDITOR YEAR ENDED 31 DECEMBER 2020

CLIMATE BONDS INITIATIVE

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 and to the charitable company’s trustees, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charitable company’s members and trustees 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 as a body and the charitable company’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Alastair Duke (Senior Statutory Auditor) For and on behalf of PKF Littlejohn LLP Statutory Auditor

15 Westferry Circus Canary Wharf London E14 4HD

Date 17 June 2021

12

CLIMATE BONDS INITIATIVE

CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES YEAR ENDED 31 DECEMBER 2020

Unrestricted
Notes
Funds
£
Income from:
Donations
2
-
Charitable activities
3
2,024,385
Bank interest
4
101
Other trading income
5
137,727
_
Total Income
2,162,213
_
Expenditure on:
Charitable activities
Trading activities
6
5
1,716,359
133,871
_
Total expenditure
1,850,230
_
Net income
10
311,983
Transfers between funds
(29,684)
_
Net Movement in Funds
282,299
Reconciliation of Funds:
Total funds brought forward
(108,416)
_
Total funds carried forward
173,883
_		 Restricted
Funds
£
-
1,482,061
-
-
_
1,482,061
_
1,388,263
-
_
1,388,263
_
93,798
29,684
_
123,482
6,575
_
130,057
__		 Total
2020
£
-
3,506,446
101
137,727
_
3,644,274
_
3,104,622
133,871
_
3,238,493
_
405,781
-
_
405,781
(101,841)
_
303,940
__		 Total
2019
£
14,685
3,324,215
30
297,500
_
3,636,430
_
3,282,072
287,056
_
3,569,128
_
67,302
-
_
67,302
(169,143)
_
(101,841)
__

All income and expenditure derive from continuing activities.

The statement of financial activities includes all gains and losses recognised during the year.

The notes on page 16 to 30 form part of these Financial Statements.

13

CLIMATE BONDS INITIATIVE Company number: 07455730

BALANCE SHEETS AT 31 DECEMBER 2020

Consolidated Consolidated Charity Charity
Notes 2020 2019 2020 2019
Fixed Assets £ £ £ £
Investments 13 - - 100 100
Intangible assets 14 28,571 66,750 28,571 66,750
Tangible assets 15 19,695 30,875 19,695 30,875
______ _ ______ ______
48,266 97,625 48,366 97,725
______ ______ ______ ______
Current Assets
Debtors 16 763,676 635,058 791,353 577,547
Cash 1,183,883 366,268 1,156,206 366,268
______ ______ ______ ______
1,947,559 1,001,326 1,947,559 943,815
Creditors:amounts falling due within one
year 17 (1,691,885) (1,200,792) (1,691,985) (1,143,381)
______ _ ______ _
Net Current Assets/(Liabilities) 255,674 (199,466) 255,574 (199,566)
______ _ ______ _
Net Assets/(Liabilities) 303,940 (101,841) 303,940 (101,841)
______ ______ ______ ______
Charity Funds 18
Unrestricted funds 173,883 (108,416) 173,883 (108,416)
Restricted funds 130,057 6,575 130,057 6,575
______ ______ ______ ______
Total Funds 303,940
______		 (101,841)
______		 303,940
______		 (101,841)
______

The Charity has taken exemption from presenting its unconsolidated profit and loss account under section 408 of Companies Act 2006. The unconsolidated surplus for the year ended 31 December 2020 is £405,781 (2019: £67,302).

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime. The financial statements were approved and authorised for issue by the Board of Trustees on 27 May 2021 and were signed on its behalf by:

Nicholas Silver

Trustee

The notes on pages 16 to 30 form part of these Financial Statements.

14

CLIMATE BONDS INITIATIVE

CONSOLIDATED STATEMENT OF CASH FLOWS AT 31 DECEMBER 2020

Notes
Net cash flow provided by operating
activities
20
Cash flow from investing activities
Payments to acquire tangible fixed assets
Bank interest
Net cash flow used in investing activities
Change in cash and cash equivalents in
the year
Cash and cash equivalents at 1 January
Cash and cash equivalents at 31 December		 2020
£
817,560
_
(46)
101
_
55
_
817,615
366,268
_
1,183,883
_		 2019
£
(63,739)
_
(23,911)
30
_
(23,881)
_
(87,620)
453,888
_
366,268
_

The notes on pages 16 to 30 form part of these Financial Statements.

15

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

1. Summary of significant accounting policies

The significant accounting policies applied in the preparation of these financial statements are set out below. The accounting policies have been applied consistently throughout the year and in the preceding year, unless otherwise stated.

General Information

Climate Bonds Initiative (CBI) is a company limited by guarantee and is registered with the Charity Commission (charity number 1154413) and the Registrar of Companies (company number 07455730) in England and Wales. In the event of the Charity being wound up, the liability in respect of the guarantee is limited £1 per member of the Charity. The address of the registered office is shown under Charity Reference and Administrative Details.

Basis of Preparation of Accounts

The charity constitutes a public benefit entity as defined by FRS 102. 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), the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102), the Charities Act 2011 and UK Generally Accepted Practice as it applies from 1 January 2019.

The financial statements consolidate Climate Bonds Initiative and its wholly owned subsidiary, Climate Bonds Services Limited. A subsidiary company, CBI Europe, registered in Belgium is also consolidated, though immaterial this year.

The financial statements are prepared in sterling which is the functional currency of the charity.

Going Concern

The financial statements have been prepared on a going concern basis as the trustees consider that no material uncertainties exist concerning the charity’s ability to operate for the foreseeable future.

The trustees have considered the charity’s ability to meet its liabilities as they arise over the foreseeable future to June 2022, being 12 months from the date of approval of these financial statements. Accordingly, financial forecasts and cash flow projections have been prepared for this period.

The trustees recognise that in a period of growth there are some uncertainties that exist in the assumptions underlying these forecasts, principally concerning income generation and have identified actions to be taken as appropriate risk mitigation should these assumptions and forecasts not be adequately achieved.

Income Recognition

All incoming resources are included in the Statement of Financial Activities (SoFA) when the charity is legally entitled to the income, after any performance conditions have been met, when the amount can be measured reliably and when it is probable that the income will be received.

For donations to be recognised the Charity will have been notified of the amounts and the settlement date in writing. If there are conditions attached to the donation and this requires a level of performance before entitlement can be obtained then income is deferred until those conditions are fully met or the fulfilment of those conditions is within the control of the Charity and it is probable that they will be fulfilled.

The Charity received government and other grants in respect of furthering its charitable objectives. Income from government and other grants are recognised at fair value when the Charity has entitlement after any performance conditions have been met, it is probable that the income will be received, and the amount can be measured reliably. If entitlement is not met then these amounts are deferred.

Verification fees, certification fees, reports income and events income are recognised in full when the charity is entitled to the income.

16

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

  1. Accounting Policies (continued)

Annual partner subscriptions are recognised 50% immediately and the balance over a 12-month period to which they relate from the month of receipt, with the balance at the year-end included as deferred income.

Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the Charity; this is normally upon notification of the interest paid or payable by the bank.

On receipt, donated professional services and donated facilities are recognised as gifts in kind on the basis of the value of the gift to the Charity which is the amount the Charity would have been willing to pay to obtain services of facilities of equivalent economic benefit on the open market; a corresponding amount is then recognised in expenditure in the period of receipt.

Expenditure Recognition

All expenditure is accounted for on an accruals basis and has been classified under the headings that aggregate all costs related to the category. Expenditure is recognised where there is a legal or constructive obligation to make payments to third parties, it is probable that the settlement will be required, and the amount of the obligation can be measured reliably. Redundancy and termination payments are recognised immediately upon becoming a constructive obligation. Expenditure is categorised under the following headings:

Support costs allocation

Support costs are those that assist the work of the charity but do not directly represent charitable activities and include office premises costs, finance, HR, IS/IT, legal and governance costs and management and administration costs. They are incurred directly and necessarily in support of expenditure on the objects of the charity. Where support costs cannot be directly attributed to particular headings they have been allocated to expenditure on charitable activities on a basis consistent with use of the resources.

Governance costs are those incurred in connection with the running of the Charity and compliance with constitutional and statutory requirements.

The analysis of these costs is included in note 8.

Intangible fixed assets

Intangible fixed assets are assets that do not have physical substance but are identifiable and are controlled by the charity through custody or legal rights. Intangible fixed assets are recorded at historical cost and amortised on a straight-line basis over 4 years.

Tangible Fixed Assets and Depreciation

Tangible fixed assets are stated at cost or net realisable value after depreciation. The cost of minor additions or those costing less than £500 are not capitalised. Depreciation is provided at rates calculated to write off the cost or valuation of fixed assets, less their estimated residual value, over their expected useful lives on a straight-line basis:

Plant and machinery 20% Office equipment 20%

17

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

1. Accounting Policies (continued)

Debtors and creditors receivable / payable within one year

Debtors are recognised when the Charity is legally entitled to the income after any performance conditions have been met, the amount can be measured reliably, and it is probable that the income will be received.

Creditors are recognised when the Charity has a present or constructive obligation resulting from a past event and the settlement is expected to result in an outflow of economic benefits.

Foreign Currency

The consolidated financial statements are presented in UK pounds sterling (£’s), the functional currency of the charity. For project planning purposes, the charity uses a standard exchange rate for the year. All transactions denominated in foreign currencies are translated at the spot rate, the actual rate achieved at the time of the transaction.

All balance sheet balances are translated at the prevailing year-end rate. Any gains or losses resulting from exchange rates are recognised through the SoFA.

Funds and Fund Accounting

Unrestricted funds are available for use at the discretion of the Trustees in furtherance of the general objective of the charity and which have not been designated for other purposes.

Restricted funds are funds which are to be used in accordance with specific restrictions imposed by donors or which have been raised by the Charity for particular purposes. The cost of raising and administering such funds are charged against the specific fund. The aim and use of each restricted fund is set out in the notes to the financial statements.

Employee Benefits

The charity operates a defined contribution plan for the benefit of its employees. Contributions are expensed as they become payable.

Tax

The charity is an exempt charity within the meaning of schedule 3 of the Charities Act 2011 and is considered to pass the tests set out in Paragraph 1 Schedule 6 of the Finance Act 2010. It therefore meets the definition of a charitable company for UK corporation tax purposes.

Financial instruments

The Charity only holds basic financial instruments. The financial assets and financial liabilities of the Charity are as follows:

18

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

Critical accounting estimates and areas of judgement

The following judgements (apart from those involving estimates) have been made in the process of applying the above accounting policies that have had the most significant effect on amounts recognised in the financial statements:

19

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

2. Income from donations

Unrestricted
Restricted
Funds
Funds
£
£
Donations
-
-
_
_		 Total
2020
£
-		 Total
2019
£
14,685

3. Income from Charitable Activities

ncome from Charitable Activities
Unrestricted
Restricted
Funds
Funds
£
£
Projects, advocacy and guidance
2,024,385
1,482,061
_
_
ank interest
Unrestricted
Restricted
Funds
Funds
£
£
Bank interest
101
-
_
_
ther trading income
Unrestricted
Restricted
Funds
Funds
£
£
Trading
137,727
-
_
_		 Total
2020
£
3,506,446
_
Total
2020
£
101
_
Total
2020
£
137,727		 Total
2019
£
3,324,215
_
Total
2019
£
30
_
Total
2019
£
297,500
__

4. Bank interest

5. Other trading income

Climate Bonds Initiative has 100% control of Climate Bond Services Limited (Company registration number 11715956), a company registered by share capital and whose registered office is 40 Bermondsey Street, London, SE1 3UD. The subsidiary year-end is also 31 December 2020. The company was incorporated on 6 December 2018.

The major activities of the company comprised the hosting of the CBI annual conference, this year held virtually, for which commercial sponsorship was obtained. The income for CBS does not include individual attendee ticketed income, which is included in CBI. The summary financial performance of the subsidiary for the year ended 31 December 2020 is as follows.

Period 6 December 2018
2020 to 31 December 2019
£ £
Turnover 137,727 297,500
Cost of sales (18,024) (22,498)
Administrative expenses (115,847) (264,558)
______ ______
Operating profit 3,856 10,444
Gift aid to parent (3,856) (10,444)
______ ______
Result for the period - -
______ ______
Current assets 100 57,511
Current liabilities - (57,411)
______ ______
Net assets 100 100
______ ______

20

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

CLIMATE BONDS INITIATIVE

Climate Bonds Initiative has 100% control of Climate Bond Initiative (Europe) ASBL (Company registration number 0730.588.756), a company registered by share capital and whose registered office is Avenue Léon Jourez 34, 420 Braine l'Alleud, Belgium. The subsidiary year-end is also 31 December 2020. The company was incorporated on 6 December 2018.

The company had no material activity in 2020 but is intended to become a hub for CBI’s activities in mainland Europe, especially in a post-Brexit era. The summary financial performance of the subsidiary for the period ended 31 December 2020 is as follows.

2020
£
Current assets 27,677
Current liabilities (27,677)
______
Net assets -
______

At balance sheet date, Climate Bond Initiative was in the process of establishing a subsidiary China , Climate Bonds Initiative Low Carbon World (Shanghai) Business Consulting Co., Ltd [Unified Social Credit Code: 91310115MA1K4MYU00]. CBI will retain 100% control of the company, whose registered address is: No. 14, Lane 1502 Luoshan Road China (Shanghai) Free Trade Pilot Zone. The subsidiary year-end is also 31 December. There was no activity in 2020.

6. Expenditure on Charitable Activities

Projects,
advocacy
and
guidance

Totals 2019		 Direct
Costs
£
2,459,650

__
2,187,784
__		 Support
Costs
£
644,972
__
1,094,288
__		 Total
2020
£
3,104,622
__
3,282,072
__		 Total
2019
£
3,282,072
__

7. Direct costs

Unrestricted
Restricted
Funds
Funds
£
£
Consultancy costs
376,621
729,977
Other direct costs
14,735
27,545
Travel and subsistence
24,379
21,775
Staff costs
834,280
430,338
_
_
Total
1,250,015
1,209,635
_
_		 Total
2020
£
1,106,598
42,280
46,154
1,264,618
__
2,459,650		 Total
2019
£
961,483
16,048
279,674
930,579
__
2,187,784

21

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

8. Support costs

Unrestricted
Restricted
Funds
Funds
£
£
Conference event costs
4,616
2,408
Establishment
and
general
administration
336,908
174,135
Support staff costs
38,655
1,460
Governance costs
37,385
-
Depreciation
11,226
-
Amortisation
38,179
-
_
_
Total
466,969
178,003
_
_
overnance costs
Accountancy fees
Auditor’s remuneration – audit fees
et income for the year
he net income is stated after charging:
Depreciation of tangible fixed assets
Amortisation of intangible fixed assets
Net losses on foreign exchange
Operating lease payments		 _
 Total
2020
£
7,024
511,043
40,115
37,385
11,226
38,179
_
644,972
_
Total
2020
£
25,517
11,868
_
37,385
_
Total
2020
£
11,226
38,179
74,378
52,692
_		 Total
2019
£
107,683
416,969
465,288
54,878
11,290
38,180
_
1,094,288
_
Total
2019
£
43,178
11,700
_
54,878
_
Total
2019
£
11,290
38,180
40,268
168,336
_

9. Governance costs

10. Net income for the year

The net income is stated after charging:

22

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

11. Staff costs and employee benefits

The total staff costs and employee benefits were as follows:

Wages and salaries
Social security
Defined contribution pension costs		 Total
2020
£
1,208,028
129,191
29,565
__
1,366,784
__		 Total
2019
£
1,235,164
132,607
28,095
_
1,395,866
_

The number of employees who received total employee benefits (excluding employer pension costs) of more than £60,000 is as follows:

Number of employees
2020 2019
£60,001 to £70,000 1 3
£70,001 to £80,000 2 1

During the year, the charity paid £4,378 (2019: £3,035) under a defined contribution pension scheme on behalf of staff.

The average monthly number of employees during the year was as follows:

Staff Number of employees
2020
2019
31
34
_
_

12. Trustees’ and key management personnel remuneration and expenses

No trustees received any remuneration or reimbursement of travel expenses from the charity during the year (2019 – none).

The trustees consider the board of trustees, the Chief Executive Officer and the Deputy Chief Executive Officer as comprising the key management personnel of the charity in charge of directing and controlling the charity and running and operating the charity on a day-to-day basis.

The total amount of employee benefits received by key management personnel during the year was £168,660 (2019: £169,850).

13. Investments (Charity)

Cost 2020 2019
£ £
Investment in subsidiary 100 100
______ ______
100 100
______ _____

23

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

14. Intangible Fixed Assets (Group and Charity)

Cost Website Total
£ £
At beginning of year 152,717 152,717
Additions - -
Disposals - -
______ ______
At end of year 152,717 152,717
______ _____
Amortisation
At beginning of year 85,967 85,967
Charge for the year 38,179 38,179
Released on disposals - -
_____ _____
At end of year 124,146 124,146
_____ ______
Net Book Value
At 31 December 2020 28,571 28,571
______ _____
At 31 December 2019 66,750 66,750
______ _____

15. Tangible Fixed Assets (Group and Charity)

Plant & Office & IT
Cost machinery equipment Total
£ £ £
At beginning of year 424 58,528 58,952
Additions - 46 46
Disposals - - -
______ ______ ______
At end of year 424 58,574 58,998
______ ______ _____
Depreciation
At beginning of year 424 27,653 28,077
Charge for the year - 11,226 11,226
Released on disposals - - -
_____ _____ _____
At end of year 424 38,879 39,303
_____ _____ ______
Net Book Value
At end of year - 19,695 19,695
______ ______ _____
At beginning of year - 30,875 30,875
______ ______ _____

24

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

16. Debtors

Group
2020
2019
£
£
Trade debtors
636,001
285,469
Other debtors4,395
115,867
Prepayments and accrued income
123,280
233,722
Intercompany debtor
-
-
__
_
763,676
635,058

___
Creditors: Amounts Falling Due Within One Year
Group
2020
2019
£
£
Trade creditors
154,299
209,058
Social security and other taxes
144,681
53,144
Other creditors
138,869
114,686
Accruals and deferred income
1,254,036
823,904
Intercompany creditor
-
-
_
_
1,691,885
1,200,792
_
_
Deferred income:
Brought forward at 1 January 2020
Incoming resources deferred during the year
Amounts released from previous years
Carried forward at 31 December 2020		 Charity
2020
2019
£
£
636,001
224,058
4,395
62,356
123,280
233,722
27,677
57,411
__
_
791,353
577,547


Charity
2020
2019
£
£
154,299
209,058
144,681
53,144
138,869
57,175
1,254,036
823,904
100
100
_
_
1,691,985
1,143,381
_
_
£
684,442
1,136,550
(684,442)
_
1,136,550
______		 Charity
2020
2019
£
£
636,001
224,058
4,395
62,356
123,280
233,722
27,677
57,411
__
_
791,353
577,547


Charity
2020
2019
£
£
154,299
209,058
144,681
53,144
138,869
57,175
1,254,036
823,904
100
100
_
_
1,691,985
1,143,381
_
_
£
684,442
1,136,550
(684,442)
_
1,136,550
______
_

17. Creditors: Amounts Falling Due Within One Year

25

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

18. Fund reconciliation (consolidated)

Current Year
Balance as
at 1.1.20
£
European Commission (EuroPace)
-
UNDP – CAP
-
G & B Moore Foundation
4,488
Oak Foundation
-
Rockefeller Foundation – Rev303
-
Rockefeller Foundation – INF311
-
World Resources Institute (WRI)
-
FCO India
-
BEIS China
3,657
BEIS Columbia
(875)
BEIS Mexico
(4,911)
ECF ASEAN
4,216
Agora Foundation
-
ECF EU Taxonomy
-
ECF Tara
-
FSD Africa
-
GCA Standards
-
GIZ ASEAN
-
Growald Foundation
-
IPSF GIZ
-
_
Total restricted funds
6,575
_
General Funds
(108,416)
_
Total unrestricted funds
(108,416)
_
Total funds
(101,841)
 Income Expenditure
costs
£
£
9,473
(14,406)
20,445
(21,590)
163,028
(171,454)
216,252
(212,984)
13,494
(18,970)
-
(446)
98,610
(107,875)
6,858
(6,858)
94,084
(93,836)
278,014
(267,329)
76,941
(74,369)
14,883
(21,241)
23,161
(23,471)
123,944
(96,252)
120,317
(91,410)
6,887
(6,855)
49,202
(49,113)
9,578
(3,229)
77,286
(27,596)
79,604
(78,979)
_
_
1,482,061
(1,388,263)
_
_
2,162,213
(1,850,230)
_
_
2,162,213
(1,850,230)
_
_
3,644,274
(3,238,493)

 Balance as
Transfers
at 31.12.20
£
£
4,933
-
1,145
-
3,938
-
-
3,268
5,476
-
446
-
9,265
-
-
-
-
3,905
-
9,810
2,339
-
2,142
-
-
(310)
-
27,692
-
28,907
-
32
-
89
-
6,349
-
49,690
-
625
_
__
29,684
130,057
_
__
(29,684)
173,883
_
__
(29,684)
173,883
_
__
-
303,940

26

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

Prior Year
Balance as
at 1.1.19
£
European Commission (EuroPace)
-
UNDP – CAP
-
G & B Moore Foundation
-
Oak Foundation
-
Rockefeller Foundation – Rev303
-
Rockefeller Foundation – INF311
-
Hewlett Foundation
-
World Resources Institute (WRI)
-
FCO India
-
BEIS China
-
BEIS Columbia
-
BEIS Mexico
-
ECF ASEAN
-
_
Total restricted funds
-
_
General Funds
(169,143)
_
Total unrestricted funds
(169,143)
_
Total funds
(169,143)
 Income Expenditure
costs
£
£
58,617
(59,567)
4,884
(5,761)
327,630
(323,142)
147,981
(148,163)
86,382
(86,870)
674
(674)
9,841
(10,131)
46,833
(54,278)
-
(83)
172,388
(168,731)
207,685
(208,560)
92,853
(97,764)
218,542
(214,326)
_
_
1,374,310
(1,378,050)
_
_
2,262,120
(2,191,078)
_
_
2,262,120
(2,191,078)
_
_
3,636,430
(3,569,128)

 Balance as
Transfers
at 31.12.19
£
£
950
-
877
-
-
4,488
182
-
488
-
-
-
290
-
7,445
-
83
-
-
3,657
-
(875)
-
(4,911)
-
4,216
_
__
10,315
6,575
_
__
(10,315)
(108,416)
_
__
(10,315)
(108,416)
_
__
-
(101,841)

Purposes of Restricted Funds:

European Commission (EuroPace)

European Commission under its Horizon 2020 Programme funded the project “EuroPace – Developing, piloting and standardising on-tax financing for residential energy efficiency retrofits in European cities and regions” from March 2018 to February 2021 in a total amount up to €175,775.

UNDP – CAP

UNDP funded the project “Climate Aggregation Platform for Developing Countries (CAP)” from June 2017 to June 2020 in a total amount up to $881,000.

G & B Moore Foundation

G & B Moore Foundation funded the project “Driving the Development of Green Agri Bonds in Brazil” from December 2017 to December 2020 in a total amount up to $1,100,516.

Oak Foundation

Oak Foundation funded the project “Growing the Global Green Bonds Market” from September 2016 to July 2019 in a total amount up to £502,178.

Rockefeller Foundation – Rev303

Rockefeller Foundation funded the standards project “Climate Bonds Standards and Definitions to Support Market Confidence” from August 2017 to May 2020 in a total amount up to $400,000.

Rockefeller Foundation – INF311

Rockefeller Foundation funded the policy project “Green Aggregation and Securitization in Emerging Markets and Developing Countries” from November 2015 to June 2017 (extended to June 2019) in a total amount up to $510,000.

World Resources Institute (WRI)

WRI funded the project “Growing the resilience of bonds market supporting climate resilience actions in developing countries” from July 2018 to October 2018 in a total amount up to $5,672.

27

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

FCO India

FCO (UK Foreign and Commonwealth Office) funded the project “Using Green Bonds to Raise International Capital for India’s Transition to a Low-Carbon and Climate Resilient Economy Phase –(II)” from January 2018 to July 2018 in a total amount up to £57,717.

BEIS China

The Secretary of State for Business, Energy and Industrial Strategy has funded the project entitled "Sustaining the Growth of China’s Green Bond Market and Facilitating Inter-Country Green Capital Flows" (February 2019 – November 2020) with £300,000.

BEIS Colombia

The Secretary of State for Business, Energy and Industrial Strategy has funded the project entitled "Scaling up Green Finance and establishing building blocks for scalable and low carbon investment in Colombia" (July 2019 – October 2020) with £485,699.54.

BEIS Mexico

The Secretary of State for Business, Energy and Industrial Strategy has funded the project entitled "Building a foundation for a sustainable and scalable low carbon future in Mexico - from Green Bonds to a Greener Ecosystem " (July 2019 – September 2020) with £181,622.

ECF ASEAN

The International Forum for Energy (IFE), an initiative of the European Climate Foundation (ECF), has funded this project to grow green infrastructure investment opportunities and the green bond market in ASEAN in order to facilitate capital flows into green infrastructure in ASEAN countries (April 2019 - April 2020) with $150,000.00.

Agora Foundation

SEFEP GmbH Agora Energiewende funded CBI with a grant for working in the context of "CRUX Policy Centre Power" with the objective of enabling the energy transition in South Africa by building capacity for green bonds (June 2020 - January 2021) with €70,000.. SEFEP (Smart Energy for Europe Platform) received the grant funding from the Aspen Global Change Institute (AGCI).

ECF EU Taxonomy

The European Climate Foundation funded this project to step up engagement and capacity building activities with key stakeholders, such as Member States, around EU green taxonomy developments and future plans. Also, it continues CBI’s technical engagement with EU on next iteration of taxonomy. (April 2020 - March 2021) with €155,619.

ECF Tara

The European Climate Foundation has funded this project to build capacity for Central Banks in the ASEAN ‐ that will enable a “green” POST Covid-- 19 response. (July 2020 - October 2021) with $299,937

FSD Africa

The Financial Sector Deepening Africa (FSDA) has funded this project to CBI to act as the lead consultant in the Nigerian Green Bonds Programme. CBI has provided support for Green Bond Issuance, which involves issuance of guidelines and listing requirements for green bonds, developing a pool of Nigeria-based Licenced verifiers, developing a pipeline of green investments, developing an international collaboration, and developing a debt capital market reform agenda to support green bonds under the Debt Capital Markets Development. (April 2018 - June 2021) with £110,320.

GCA Standards

The Global Centre on Adaptation funded this project with an overall goal to help advance common understanding of resilience investments and opportunities in the bond market, through bespoke research, guidance preparation, and stakeholder engagement (Sep. 2020 - March 2021) with €64,763.

GIZ ASEAN

GIZ ( Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH) funded this project to assess the “EU Sustainable Finance Action Plan to Finance a Green Corona Recovery” in the ASEAN Region (Dec 2020 - Aug 2021) with €447,147.

Growald Foundation

The Growald Foundation has funded this project to deliver: (i) Green infrastructure investment opportunities report and investor forum for GBA, (ii) Market education and trainings to relevant stakeholders in GBA* on green bonds, (iii) Guidelines on green transition finance for China with a focus on Guangdong/GBA (July 2020 - October 2021) with $100,000.

( * GBA is the Greater Bay Area of China comprising Hong Kong and neighbouring Chinese cities)

28

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

IPSF GIZ

GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH) has funded this project to support the International Platform on Sustainable Finance (IPSF), an initiative of the EU’s DG FISMA (June 2020 - April 2021) with €175,716.

19. Analysis of net assets between funds

Current Year
Restricted Funds
Unrestricted funds
Total funds
Prior Year
Restricted Funds
Unrestricted funds
Total funds		 Fixed
Assets
£
-
48,266
_
48,266
_
Fixed
Assets
£
-
97,625
__
97,625
 Current
Creditors
due within
assets
one year
£
£
130,057
-
1,817,502
(1,691,885)
_
_
1,947,559
(1,691,885)
_
_
Current
Creditors
due within
assets
one year
£
£
6,575
-
994,751
(1,200,792)
_
_
1,001,326
(1,200,792)

 Total
£
130,057
173,883
_
303,840
_
Total
£
6,575
(108,416)
__
(101,841)

20. Reconciliation of net income to net cash flow from operating activities

Net movement in funds for the year
Bank interest
Depreciation and amortisation
(Increase) in debtors
Increase in creditors
Net cash provided by operating activities		 2020
£
405,781
(101)
49,405
(128,618)
491,093
__
817,560
__		 2019
£
67,302
(30)
49,470
(275,734)
95,523
_
(63,739)
_

29

CLIMATE BONDS INITIATIVE

NOTES TO THE FINANCIAL STATEMENTS AT 31 DECEMBER 2020

21. Related Party Transactions

During the year, the daughter of the Chief Executive, Sean Kidney, was paid £490 (2019: £947) for services provided to the charity on an arm’s length basis.

22. Prior year Statement of Financial Activities

Unrestricted
Notes
Funds
£
Income from:
Donations
14,685
Charitable activities
1,949,905
Investment income
Other trading income
30
297,500
_
Total Income
2,262,120
_
Expenditure on:
Charitable activities
Trading activities
1,904,022
287,056
_
Total expenditure
2,191,078
_
Net (expenditure) / Net movement in funds
Transfer between funds
Net movement between funds
71,042
(10,315)
_
60,727
Reconciliation of Funds:
Total funds brought forward
(169,143)
_
Total funds carried forward
(108,416)
__		 Restricted
Funds
£
-
1,374,310
-
-
_
1,374,310
_
1,378,050
-
_
1,378,050
_
(3,740)
10,315
_
6,575
-
_
6,575
__		 Total
2019
£
14,685
3,324,215
30
297,500
_
3,636,430
_
3,282,072
287,056
_
3,569,128
_
67,302
-
_
67,302
-
(169,143)
_
(101,841)
__

23. Operating lease commitments

Total future minimum lease payments under non-cancellable operating leases are as follows:

Within one year 2020
£
-
__
-
__		 2019
£
42,276
_
42,276
_

30