Charity Number 1166697
A Charitable Incorporated Organisation (CIO)
Report and Unaudited Accounts Year ended 30 September 2021
The Ethos Foundation Report and accounts Year ended 30 September 2021
| Contents | Page |
|---|---|
| Company information | 1 |
| Trustees' report | 2 to 8 |
| Independent Examiner's report | 9 |
| Statement of Financial Activities | |
| (Including Income and Expenditure Account) | 10 |
| Cash flow statement | 11 |
| Balance Sheet | 12 |
| Notes to the accounts | 13 to 16 |
The Ethos Foundation Charity Information
Trustees
G E Gordon Chair B Gordon L Blythe L Gakic (appointed 28 June 2021)
Independent Examiner
Monika Hazelton FCCA Winston Hazelton & Co Ltd 34 Arlington Road London NW1 7HU
Principal address
18 Buckingham Palace Road London SW1W 0QP
Registered office
18 Buckingham Palace Road London SW1W 0QP
Charity number
1166697
Bankers
Barclays 1 Churchill Place London E14 5HP
Solicitors
Bates Wells 10 Queen Street Place London EC4R 1BE
1
The Ethos Foundation Registered Charity number: 1166697 Trustees report
The trustees present their report and accounts for The Ethos Foundation (the ‘Foundation’) for the year ended 30 September 2021.
This report incorporates the strategic report of the Foundation, including its achievements and plans for the future.
The trustees have adopted the provisions of the Statement of Recommended Practice (FRS 102 Charities SORP) on "Accounting and Reporting by Charities", effective 1 January 2019, in preparing the annual report and financial statements of the Foundation.
Structure, Governance and Management
Structure and organisation
The Ethos Foundation was incorporated on 22 April 2016 as a Charitable Incorporated Organisation (CIO) with the Charity Commission in England. The charity registration number is 1166697 and the CIO number is CE006474.
The Foundation is governed by its Constitution dated 22 April 2016.
The registered and the principal office are situated at 18 Buckingham Palace Road, London, SW1W 0QP.
The trustees who are also the members of the Charity have no liability to contribute to its assets and no personal responsibility for settling its debts and liabilities.
The number of trustees shall not be less than three. There is no maximum number.
The Foundation is under the overall control of the trustees who conduct the affairs of the charity. The trustees meet regularly to set the policy and overall direction of the Charity, to review its plans and to discuss the management of the charity's affairs.
The first trustees are the Founder Members, and they are G Gordon and B Gordon. The Founder Members must appoint at least one Independent Trustee, who must not be a member of the Founder Members' family or a connected person. Lucy Blythe was appointed as Independent Trustee in 2016.
Luka Gakic, the Founding Members son-in-law, was appointed trustee during the year. A former refugee and scholarship beneficiary, Luka is committed to upholding and advancing social mobility and compassion in British society.
The Foundation has implemented policies and procedures for the induction and training of both new and existing members.
Governance and operating principles
The Foundation has implemented policies and procedures for the induction and training of both new and existing members.
Trustees have continued to reflect broadly on the goals of the Foundation and how best to focus our efforts to fulfil our mission to promote the security and well-being of society.
2
The Ethos Foundation Registered Charity number: 1166697 Trustees report
Key management personnel
The trustees consider that they are the key management personnel of the Foundation in charge of directing, controlling, running and operating the charity on a day-to-day basis.
All trustees give their time freely and no trustee received remuneration in the year.
Details of trustees' expenses are disclosed in Note 4 to the accounts.
Objectives and Aims
Principal Objectives and Aims
The Ethos Foundation's vision is a society in which individuals and communities thrive. The Foundation's mission is to promote the security and well-being of society.
Our work is underpinned by our values:
-
Fairness - striving for greater equity and justice
-
Good citizenship – putting our responsibility to society first
-
Reflectiveness - building our knowledge and challenging ourselves
Our overarching goal is to support the United Nations Sustainable Development Goals (SDGs) and in particular:
-
SDG No. 1 No Poverty – leave no one behind
-
SDG No. 10. Reduce inequality within and among countries
The Foundation is currently focused exclusively on projects addressing societal issues in the UK.
The trustees confirm that they have referred to the information contained in the Charity Commission's general guidance on public benefit when reviewing the Foundation’s aims and objectives and in planning future activities and setting the grant-making policy for the year.
The trustees are satisfied that the objectives of the Foundation are met through supporting identified best-practice organisations invited to apply for grants. The Ethos Foundation does not accept unsolicited grant applications or proposals for funding.
Principal Activity, Review of Business and Achievements and Performance
The Ethos Foundation is a grant-making charity. The Foundation funds charitable causes and programmes selected by the trustees on the basis of alignment with the Foundation’s mission, and regularly monitors our grantee’s impact.
Achievements and performance
During the Foundation's financial year grants were made to 22 charities totalling £1,363,045 (2020: 31 grants totalling £1,028,563) representing a 34% increase in funding on the previous year.
3
The Ethos Foundation Registered Charity number: 1166697 Trustees report
Portfolio of principal charity partners
The Childhood Trust received £625,000 (2020: £640,000) in unrestricted funding. The Childhood Trust (the Charity) is London's child poverty charity, dedicated to alleviating the impact of poverty on children and young people living in the UK’s capital. The funding covered a proportion of the Charity's core costs as well as supporting the Charity's match funding campaigns. Trustees recorded their satisfaction with the performance of the Charity against a backdrop of continuing challenging circumstances for children and young people due to lockdowns and school closures.
Faced with the ongoing national emergency arising from the COVID-19 pandemic, the organisation delivered vital support for its partner charities fighting against the impact of child poverty in London. During their last financial year, the Charity raised £6.6 million for charitable projects primarily via the Christmas Challenge 2020 and Champions for Children 2021 summer campaign, consolidating the growth in funding that followed the outbreak of the COVID pandemic.
Over 290,000, or approximately 1 in 3 of the 800,000 children living in poverty in the capital, were supported through the Charity’s work to alleviate the worst economic, social and emotional effects of the pandemic. The Charity's advocacy work also intensified, further raising awareness of the devastating impact of the coronavirus epidemic on the capital’s most disadvantaged children giving them a voice.
The Cabrach Trust ('the Trust') received £230,000 in unrestricted grants (2020: £185,000). The Trust’s vision and long- term ambition is to foster sustainable regeneration within this small rural community in NE Scotland. In support of this aim the Trust’s mission is to provide economic and social development opportunities in the Cabrach, creating employment and attracting new visitors to the area to celebrate and protect the cultural heritage, wild landscape and history.
During the year sufficient match funding was secured by the Trust for the Ethos Foundation’s £2,000,000 capital pledge to be activated, although draw down had not yet commenced at year-end. The funding enabled final design and planning for the Cabrach Distillery & Heritage Centre to be carried out with construction expected to commence in 2022.
Thrive at Five is a new collective impact initiative to achieve sustainable improvements in terms of school readiness as measured in reception year. The overarching vision for Thrive at Five is a society that cherishes children’s development in the early years and where every child can thrive and achieve their full potential.
To develop the framework the organisation plans to run a number of place-based community pathfinders across the UK, the first of which is in Stoke on Trent in partnership with the Local Authority, focusing on two wards Bentilee and Abbey-Hulton. Thrive at Five, entered into a funding agreement with the Foundation and was granted £333,334 as first instalment of a £1 million threeyear unrestricted grant agreement with the new organisation.
4
The Ethos Foundation Registered Charity number: 1166697 Trustees report
Achievements and performance, cont.
The Foundation continued its long-term support for the Beacon Collaborative with the aim of building a stronger civil society by encouraging people to use a greater level of their private assets for public good. Beacon is an advocate for philanthropy as a force helping shape our society. An additional £20,000 was donated in 2021 (2020: £20,000).
The Foundation’s miscellaneous smaller grants totalled £154,711 in 2021 (2020: £127,313), supporting a variety of good causes. The increase in the Foundation’s smaller grant-making activity was largely in response to the COVID-19 epidemic and emergency appeals received from a range of charities to which we were able to respond in some cases, with grants which were mainly unrestricted.
List of charities funded in the year
| of charities funded in the year | |
|---|---|
| £ | |
| The Childhood Trust | 625,000 |
| The Cabrach Trust | 230,000 |
| Thrive at Five | 333,334 |
| Beacon Fellowship | 20,000 |
| Grants below £20,000 | |
| ACMS | |
| Ashoka UK | |
| Bail for Immigration Detainees | |
| Big Issue | |
| Braemar Community Limited | |
| City of London Sinfonia | |
| Distillers' Charity | |
| Durham University | |
| Focus on Labour Exploitation | |
| Grange Park Opera | |
| Opera Holland Park | |
| Quintessentially Foundation | |
| Royal Academy of Dance | |
| Royal Marsden Cancer Charity | |
| Royal Philharmonic Orchestra | |
| St John Ambulance | |
| Together TV |
Subtotal 154,711 Total Granted 1,363,045
5
The Ethos Foundation Registered Charity number: 1166697 Trustees report
Grant Making
The Foundation will normally apply most of its annual income to charitable causes selected by its trustees. Grant-making decisions will aim to honour and build upon the Foundation's historic philanthropic efforts, and to build positive impact going forward. The Foundation's giving is informed by a multi-generational family commitment to philanthropy.
From time to time, the Foundation may identify new focus areas and will conduct research and due diligence to identify the charities best placed to make a difference within the particular area of need. Those identified will be invited to apply for support. Upon invitation, potential grantees are formally invited to work with the Foundation in preparing grant materials for proposal development and review by the trustees.
Trustees assess all large grants made, with a particular focus on ensuring that charities supported by the Foundation are well governed and have sufficient reserves to provide for their financial sustainability following a set of guidelines as a framework for grant-making decisions.
Risk management
The trustees have a risk management strategy that comprises:
-
Regular review of the risks the Foundation may face and updates to the Risk Register
-
The establishment of systems and procedures to mitigate those risks identified
-
The implementation of procedures designed to minimise any potential impact on the Charity should those risks materialise.
-
Monitoring the impact of grants awarded
Conflict of interest
Conflict of interest is mitigated by keeping the conflict of interest register up to date and following procedures stated in the Constitution for trustees to abstain from certain decisions if this is deemed necessary. Founder Members or a member of the Founders' family shall not be considered to be in a position of conflict of interest merely by virtue of being a trustee of, or being otherwise connected with, a charity connected to a Founder Member or a member of the Founders' family including but not limited to: The Childhood Trust (Registered Charity No 1154032), Distillers' Charity (Registered Charity No 1038763), The Cabrach Trust (Scottish Charity no SC043771) and Thrive at Five (Registered Charity No: 1195059).
Financial Review
Review of Statement of Financial Activities (Including Income and Expenditure Account) Total income for the year was £999,999 (2020: £999,999) and total expenditure was £1,394,887 (2020: £1,037,739). The overall deficit was £394,888 (2020: Deficit of £37,740).
Reserves at the year-end were £168,487 (2020: £563,375) all of unrestricted funds.
Principal funding sources review
The Foundation’s principal source of funds was donations from the Founder Members' family trust. The family's trustees have been notified of the conditional capital grant pledged towards The Cabrach Trust. We are confident that the Foundation will continue to have sufficient funds to meet its grant obligations.
6
The Ethos Foundation Registered Charity number: 1166697 Trustees report
Reserves policy
The trustees seek to retain a prudent level of reserves.
The reserves policy of the Foundation accords with the Charity Commission's guidelines and comprises the following two elements:
-
To underpin the running of the Foundation with six month's running costs
-
Within the six months running costs identify those costs that will enable the Foundation to meet its obligations to staff and other stakeholders whilst removing unnecessary expenditure.
As of 30 September 2021, six months' running costs of the Charity as described above are approximately £10,000.
Unrestricted reserve levels are reviewed annually in line with an annual planning and budgeting process and monitored throughout the year.
Investment policy
The trustees take a very conservative view regarding the investment of surplus funds. Under the Constitution, the Foundation has power to make any investment which the trustees see fit after obtaining advice from a financial expert as the trustees consider necessary and permitted to do by the Trustee Act 2000.
The trustees have considered the most appropriate policy for investing funds and have decided funds invested in bank accounts currently meet their requirements.
Looking forward and plans for future
Following the financial year end the Foundation received donations from its Chair totalling approximately £48 million. The newly received capital constitutes the Foundation’s pool of charitable resources for future grant-making. The funds will provide increased opportunity for the Foundation to drive forward its mission to promote the security and well-being of society in the UK. In line with the wishes of the Founder Members, it is planned that these funds will be fully granted, in support of the Foundation’s mission, by 31st December 2035. The Foundation aims to spend down its endowment.
Fixed Assets
The Foundation has no fixed assets.
Trustees
The trustees of the Charity had no beneficial interest in the funds of the Charity and they were as follows:
G E Gordon Chair B Gordon L Blythe L Gakic (appointed 28 June 2021)
7
The Ethos Foundatlon
Reglstered Charity number.. 1166697
Trustses report
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The Ethos Foundation Statement of Financial Activities (Including Income and Expenditure Account) for the year ended 30 September 2021
| Notes Income Income from: Donations Total Income Expenditure Expenditure on: Charitable activities 2 Other expenditure 2 Total Expenditure Net movement in funds Reconciliation of funds: Total funds brought forward Total funds carried forward |
Unrestricted Funds 2021 £ 999,999 |
Restricted Funds 2021 £ - |
Total Funds 2021 £ 999,999 999,999 (1,383,322) (11,565) (1,394,887) (394,888) 563,375 168,487 |
Total Funds 2020 £ 999,999 |
|---|---|---|---|---|
| 999,999 | - | 999,999 | ||
| (1,383,322) (11,565) |
- - |
(1,034,785) (2,954) |
||
| (1,394,887) | - | (1,037,739) | ||
| (394,888) 563,375 |
- - |
(37,740) 601,115 |
||
| 168,487 | - | 563,375 |
Continuing operations
All of the above results in the current and comparative years are derived from continuing activities.
Other recognised gains and losses
There were no other recognised gains or losses other than those stated above.
Movements in funds
Movements in funds are disclosed in Note 8 to the Accounts.
Comparative figures
See note 15.
10
The Ethos Foundation Cash Flow Statement
for the year ended 30 September 2021
| Cash generated from operations Net movement in funds Adjustments for Decrease/(increase) in debtors Increase/(decrease) in creditors Net increase/(decrease) in cash Cash at bank and in hand less overdrafts at start of the period Cash at bank and in hand less overdrafts at end of the year Consisting of: Cash at bank and in hand at end of the period |
2021 £ (394,888) 494,933 792 100,837 100,837 60,001 160,838 160,838 |
2020 £ (37,740) (5,775) (5,116) |
|---|---|---|
| (48,631) | ||
| (48,631) 371,387 |
||
| 60,001 | ||
| 60,001 |
11
The Ethos Foundation Balance Shoot as at 30 September 2021 Chty Number 1166691 CIO No CECQ6474 Not•$ 2021 2020 Curr•nl 488ets Deblors Cash al bÈhk ond in hand 505,774 .001 565,775 160.838 171,679 Creditor¥: amounts lalllng due wilhln on¥ yq¥r 13.1921 12,400) Net curronl asset# 168,487 3,375 Nét 48••t• 168.487 3,376 Fund8 Unr¥slrided Funds Restricted Funds 168,487 3,375 Total funds 168487 583 375 ApprOY the S*3ned on ils behalf by.. G Gordon Foun1J Membrr 12
The Ethos Foundation Notes to the Accounts
for the year ended 30 September 2021
1 Accounting policies
Basis of preparation
The financial statements have been prepared under the historical cost convention (unless otherwise stated in the relevant policy or note) and 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) (effective 1 January 2019) - Charities SORP FRS 102, the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102) and the Charities Act 2011.
Public benefit entity
The Charity meets the definition of a public entity under FRS 102.
Going concern
The trustees consider that there are no material uncertainties related to event or conditions that cast significant doubt upon the Foundation's ability to continue as a going concern. The trustees have made this assessment for a period of at least one year from the date of approval of the financial statements. In particular the trustees considered the Charity's budget projection. The trustees made enquires and have concluded that there is a reasonable expectation that the Charity has adequate resources to continue in operational existence for the foreseeable future. The Charity therefore continues to adopt the going concern basis in preparing its financial statements.
Following the guidance from the Charities SORP Committee on the implications of the COVID-19 epidemic on control measures and charity financial reporting, the Trustees considered the charity's sustainability in the light of COVID-19 and concluded that it had adequate reserves at present and that the principal sources of core cost funding were not under threat.
Fund accounting
Unrestricted funds comprise income receivable or generated for the furtherance of the objects of the Charity without a specified purpose and are available as general funds. Expenditure which meet these criteria are charged to the funds, together with a fair allocation of support costs. Accumulated surpluses are available for use at the discretion of the trustees.
Restricted funds are used for the specific purposes laid down by the donor (if any). Expenditure which meet these criteria are charged to the funds.
Income
Total income is included in the Statement of Financial Activities. Income comprises principally donations to further the charities objectives. Donations are brought into income when the Charity has entitlement to the funds, any performance conditions attached to the income have been met, it is probable that the income will be received and that the amount can be measured reliably.
Expenditure
Expenditure is recognised once there is a legal or constructive obligation to make a payment to third party, it is probable that the settlement will be required and the amount of the obligation can be measured reliably. Expenditure includes attributable VAT which cannot be recovered. Expenditure which is directly attributable to specific activities will be included in the relevant activity.
Support costs
These are management and administrative costs and comprise expenditure not directly attributable to the generated funds, charitable or fund raising activities of the Charity, but relate to furtherance of the Charity's objectives. They are therefore allocated to the relevant category of resources expended based on estimates of the time devoted to each activity.
13
The Ethos Foundation Notes to the Accounts for the year ended 30 September 2021
Accounting policies, cont.
Cash at bank and in hand
Cash at bank and in hand includes bank balance held in a current account.
Creditors
Creditors and provisions are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally recognised at their settlement amount after allowing for any trade discounts due.
Taxation
The Charity is not liable to corporation tax as it is a Registered Charity.
The Charity is not VAT registered and can therefore not recover input tax on goods and services purchased.
2 Analysis of expenditure
| Analysis of expenditure | |||||
|---|---|---|---|---|---|
| Charitable donations Support to Thrive at Five Charity platforms administrative charges Accounting-Independent Examiner Legal fees Travel and subsistence Bank charges Consultancy costs Social media strategy costs General expenses Subscriptions Charitable activities Grants Support costs Other expenditure Support costs Total expenditure |
Raising funds £ - - - - - - - - - - - |
Charitable activities £ 1,363,045 11,354 35 - - - - - - - - |
Support costs £ - - - 2,880 7,698 - 136 2,667 3,997 405 2,670 |
2021 2020 Total Total costs costs £ £ 1,363,045 1,028,563 11,354 - 35 1,239 2,880 2,400 7,698 - - (495) 136 181 2,667 3,209 3,997 151 405 - 2,670 2,491 |
|
| - Restricted funds: - - |
1,374,434 Unrestricted funds: 1,374,434 8,888 |
20,453 (8,888) (11,565) |
1,394,887 | 1,037,739 1,029,802 4,983 |
|
| - | 1,383,322 | 1,034,785 | |||
| 11,565 | 2,954 | ||||
| - | 11,565 | (20,453) | 2,954 | ||
| - | 1,394,887 | - | 1,037,739 |
Support costs include all expenditure not directly related to the charitable activity. These are allocated to the relevant activity based on estimates of time devoted to each activity.
All grants given were to institutions. Details and reconciliations of material grants given are presented and reconciled in the Trustees' Annual Report.
3 Net movement in funds
Net movement in funds 2021 2020 £ £ This is stated after charging: Independent examination 2,880 2,400
14
The Ethos Foundation Notes to the Accounts
for the year ended 30 September 2021
- 4 Analysis of staff costs, trustee remuneration and expenses, and the cost of key management personnel
| Travel cost | 2021 £ - |
2020 £ (495) |
|---|---|---|
The trustees did not receive any remuneration for services to the Charity during the year.
The Charity had no employees during the period, and therefore staff costs were nil.
| 5 Debtors Funds to which entitlement conditions have been met Other debtors Prepayments 6 Creditors: amounts falling due within one year Deferred income Other creditors 7 Unrestricted Funds At the beginning of year Donations incoming Resources outgoing At the end of the year 8 Analysis of net assets between funds 2021 Unrestricted Funds Current assets 171,679 Creditors: amounts falling due within one year (3,192) 168,487 |
5 Debtors Funds to which entitlement conditions have been met Other debtors Prepayments 6 Creditors: amounts falling due within one year Deferred income Other creditors 7 Unrestricted Funds At the beginning of year Donations incoming Resources outgoing At the end of the year 8 Analysis of net assets between funds 2021 Unrestricted Funds Current assets 171,679 Creditors: amounts falling due within one year (3,192) 168,487 |
2021 Restricted Funds - - |
2021 £ - 10,194 647 |
2020 £ 499,999 - 5,775 |
|---|---|---|---|---|
| 10,841 | 505,774 | |||
| 2021 £ 312 2,880 |
2020 £ - 2,400 |
|||
| 3,192 | 2,400 | |||
| 2021 £ 563,375 999,999 (1,394,887) |
2020 £ 601,115 999,999 (1,037,739) |
|||
| 168,487 | 563,375 | |||
| 2021 Total Funds 171,679 (3,192) |
2020 £ Funds 565,775 (2,400) |
|||
| 168,487 | - | 168,487 | 563,375 |
9 Charity information
The Ethos Foundation is a Charitable Incorporated Organisation (the CIO) which has a principal office in England. Principal address and registered office is 18 Buckingham Palace Road, London, SW1W 0QP.
15
The Ethos Foundation Notes to the Accounts for the year ended 30 September 2021
10 Presentation currency
The financial statements are presented in Sterling.
11 Transactions with trustees
There was a donation received of £312, inclusive of gift aid, from the Chair of the Foundation, G. Gordon in strict support of The Distillers’ Charity 350th anniversary. The appeal for the funds took place in December 2021 and therefore the £312 donation was included in the deferred income. Also some legal costs of a charitable nature were met by the Foundation. On examination of these costs, it was established that they should have been paid by the Founders trustees instead. The amount of £10,194 is therefore included in other debtors and it was repaid back to the Foundation after the year end.
12 Liability of members
The members of the Charity (being the Charitable Incorporated Organisation, the CIO) have no liability to contribute to its assets and no personal responsibility for settling its debts and liabilities on wounding up.
13 Connected charities
Some of the Trustees of the Charity are also Trustees of the following (but not limited to) organisations: The Childhood Trust (Registered Charity 1154032), The Cabrach Trust (Scottish Charity SC043771) and Thrive at Five (Registered Charity 1195059) that received material donations as noted in the Trustees' Annual Report.
14 Accounting period
30 September continued to be a preferred date to report the achievements of the Charity.
- 15 Statement of Financial Activities (Including Income and Expenditure Account) for the year ended 30 September 2020 (comparative figures)
| Notes Unrestricted Funds 2020 £ Income Income from: Donations 999,999 Total Income 999,999 Expenditure Expenditure on: Charitable activities 2 (1,034,785) Other expenditure 2 (2,954) Total Expenditure (1,037,739) Net movement in funds (£37,740) Reconciliation of funds: Total funds brought forward 601,115 Total funds carried forward 563,375 |
Notes Unrestricted Funds 2020 £ Income Income from: Donations 999,999 Total Income 999,999 Expenditure Expenditure on: Charitable activities 2 (1,034,785) Other expenditure 2 (2,954) Total Expenditure (1,037,739) Net movement in funds (£37,740) Reconciliation of funds: Total funds brought forward 601,115 Total funds carried forward 563,375 |
Restricted Funds 2020 £ - |
Total Funds 2020 £ 999,999 |
|---|---|---|---|
| 999,999 | - | 999,999 | |
| (1,034,785) (2,954) |
- - |
(1,034,785) (2,954) |
|
| (1,037,739) | - | (1,037,739) | |
| (£37,740) 601,115 |
- - |
(£37,740) - |
|
| 563,375 | - | (37,740) |
16