OpenCharities

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

2023-12-31-accounts

THE BARING FOUNDATION

REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

Company number 950696 Charity number 258583

THE BARING FOUNDATION

CONTENTS

Page
Trustees' Report 1 - 6
Independent Auditor's Report 7 - 9
Statement of Financial Activities 10
Balance Sheet 11
Cash Flow Statement 12
Notes to the Financial Statements 13 - 22

THE BARING FOUNDATION TRUSTEES' ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Status The organisation is a charitable company limited by guarantee, incorporated on 25 March The organisation is a charitable company limited by guarantee, incorporated on 25 March
1969 and registered as a charity on 31 July 1969.
Governing Document The company was established under a memorandum of association which established the
objects and powers of the charitable company and is governed by its articles of association.
Company Number 950696
Charity Number 258583
Registered Office and 8-10 Moorgate
Operational Address London
EC2R 6DA
Honorary officers Lucy de Groot CBE Chair
Shauneen Lambe Vice Chair (until June 2023)
Dr Rob Berkeley MBE Vice Chair (from June 2023)
Ashley Coombes Treasurer
David Cutler Secretary
Principal Staff David Cutler Director
David Sampson Deputy Director
Bankers Royal Bank of Scotland
Bolton Customer Services
P.O. Box 2027
Parklands
De Havilland Way
Bolton BL6 4YU
Solicitors Bates Wells
10 Queen Street Place
London
EC4R 1BE
Auditors Haysmacintyre LLP
10 Queen Street Place
London
EC4R 1AG
Investment Managers Baillie Gifford & Co. Charities Property Fund
Calton Square Savills Investment Management
1 Greenside Row 33 Margaret Street
Edinburgh EH1 3AN London W1G 0JD

THE BARING FOUNDATION TRUSTEES' ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

The trustees present their report and the audited financial statements for the year ended 31 December 2023. The trustees who served during the year and up to the date of this report were as follows:

Asif Afridi Chair of the Strengthening Civil Society Committee (until June 2023) Victoria Amedume MBE Chair of the Arts Committee Dr Rob Berkeley MBE Ashley Coombes Lucy de Groot CBE Chair of the Board and Chair of the Nominations Committee David Elliott (until June 2023) James Jenkins Chair of the Investment Committee Shauneen Lambe Chair of the Strengthening Civil Society Committee (from June 2023) Dipuo Virginia Magwaza Pontso Mafethe Chair of the International Committee Toby Nangle (from June 2023) Jillian Popkins Rhys Pullen Chair of the Audit Committee Judith Robertson Sam Thorne Emebet Wuhib-Mutungi

Reference and administrative information set out on page one forms part of this report. The financial statements comply with current statutory requirements, the memorandum and articles of association and the Statement of Recommended Practice, Accounting and Reporting by Charities (Second Edition, effective 1 January 2019), and the Companies Act 2006.

Purpose and values

The Baring Foundation was set up in 1969. It is a registered charity and company limited by guarantee governed by its memorandum and articles of association. It may use its capital and income to make grants "to such charities or for such charitable purposes" as trustees determine. The Foundation derives its income from a diversified investment portfolio.

The following purpose and values statement was adopted by trustees in December 2018:

We are an independent foundation which protects and advances human rights and promotes inclusion. We believe in the role of a strong, independent civil society nationally and internationally. We use our resources to enable civil society to work with people experiencing discrimination and disadvantage and to act strategically to tackle the root causes of injustice and inequality.

Structure, governance and management

The trustees of the charity are members of the Board of the Foundation and are directors under the Companies Act 2006. The current members appoint new trustees. Every three years trustees retire from office at the AGM but are eligible for reelection, currently subject to a maximum term of 12 years.

At the Board in June 2023 Toby Nangle was elected as a Member of the Board. In June 2023 David Elliott retired from the Board. At the AGM in September 2023 Asif Afridi, Victoria Amedume, Lucy de Groot, James Jenkins, Shauneen Lambe and Jillian Popkins retired by rotation and were re-elected as Members of the Board.

Trustees invite suitably qualified and experienced people to consider nomination as a trustee. A trustees' skills audit is undertaken from time to time to identify ways in which the Board could be strengthened. On appointment trustees are given an induction pack and are offered one or more briefing meetings with the Director and/or Chair.

Trustees are responsible for all decisions on the Foundation's policy and grants. In 2023 the Board had seven subcommittees; three for grant programmes, Investment, Audit, Remuneration and Nominations.

THE BARING FOUNDATION TRUSTEES' ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Structure, governance and management (con't)

All trustees give their time voluntarily and receive no benefits from the charity. Any expenses reclaimed from the charity are set out in note 6 to the accounts.

Trustees have carefully considered the Charity Governance Code, concluding that they satisfactorily comply with its advice overall though choosing to depart from it on two issues. Firstly, they retain a maximum board strength of 15 (rather than the recommended maximum of 12) as they believe the many different fields requiring expertise merit a larger board. Secondly, they retain an upper limit of 12 years tenure in renewable three year periods for trustees (rather than the recommended maximum of 9 years). This is due to the belief that the turnover on a large board is sufficient and the long time scale of our grant programmes and investment strategy benefits from this potential longevity.

The Foundation employs six staff who adopt a hybrid working approach working from office accommodation in central London generously provided pro bono by ING bank and home locations.

Objectives and activities

The Foundation agreed a total of 99 new grants during the year to the value of £4,251,063 (see note 8). These were: 22 Arts and Mental Health programme grants totaling £1,087,848; 11 International Development grants totaling £1,090,432; 10 Strengthening Civil Society programme grants totaling £1,228,149, 4 Strengthening Civil Society Human Rights grants (jointly funded with City Bridge Trust) totaling £224,659, 2 Shrinking Civic Space grant totaling £185,000 and one Strengthening Civil Society Racial Justice grant of £30,000. Two grants, which were outside the above-mentioned programmes, were made totaling £25,000. In addition to this the Foundation made 20 grants to existing grantees, over all the grant programmes, as an extra payment to cover costs relating to increasing inflation, totaling £64,881 and 27 grants at the behest of the Baring Family totaling £314,794.

Of those 99 grants agreed during 2023, £2,159,038 had been paid by the end of the year; a further £1,733,372 was paid as a result of grant decisions made in previous years.

The Foundation is a member of 360 Giving and a Living Wage Funder, as part of an ongoing review of our ways of working as a grantmaker.

Our approach to grant making is bespoke to each grant programme and the opportunities which we see as available in each field. These circumstances change over time and our approach will continue to evolve. This means that we do not have a default approach, such as always funding core costs or projects, short or long term, restricted or unrestricted, but carefully consider specific needs in liaison with civil society organisations. The main initiative we took this year was to make top up grants to current grantees now experiencing much higher rates of inflation than anticipated when we first funded their work. After the unwelcome interlude of Covid and lockdowns we welcomed being in more personal touch with grantees through visits including to Africa and events. We organised a three day residential for our Strengthening Civil Society grant partners and an all day gathering at the splendid new theatre, Brixton House for arts partners.

The main focus of our Arts programme continued to be people living with mental health problems (our programme starting in 2020). This is a complex field with many actors as well as differing systems and funding in the four nations. 38 grants that we made in 2021 and 2022 to address the under-representation of artists of Colour in this field continued their work along with a major new grant to Greater Manchester Integrated Care System for the same purpose. We added a third strategic funding partnership with the Arts Council Northern Ireland to our ongoing partnerships with Creative Scotland and the Arts Council Wales. We agreed to jointly fund a conference in Manchester in 2024 with the Arts Council England on creativity and young people’s mental health. Much of our funding in 2023 was devoted to grants to build good practice in specific area. These included a major grant to Counterpoint Arts following their report to us on arts with refugees with mental health problems. Our interest in work in museums following our research report in 2022 led to grants on good practice guidance to Tyne and Wear Archives and Museums as well as ones to Manchester Arts Gallery on the Trauma Informed Museum and with Whitworth Gallery where people recovering from addictions will become curators leading to an exhibition. Other areas of good practice have been varied such as guidance for work in choirs and even how magic can be used with children in Pupil Referral Units. Another area that has been raised with us is support for artists working in this area and we have previously made grants around this. This led in 2023 to a grant to support artists by the Wales Arts Health and Wellbeing Network.

Alongside this main programme we have continued some support for our legacy programme on creative ageing. This saw a major conference with the Arts Council England in Newcastle with two new publications on our Celebrating Age funding programme with them and a report on the future of creative ageing. In England too we continued to support the National Arts in Care Homes Day run by the National Activity Providers Association (NAPA) as well as the Creative Ageing Development Agency which we core fund.

Our International Programme since 2014 has focused on the rights of Lesbian Gay Bisexual Transgender and Intersex (LGBTI) people, especially women, in Africa. 2023 was a landmark year for our programme which in November at a summit in London announced a new fund for LGBTI activists in Africa and beyond.

THE BARING FOUNDATION TRUSTEES' ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Objectives and activities (con't)

The fund is the culmination of several years of research and advocacy driven by the Foundation and with support from many partners. In an important and welcome step the Foreign and Commonwealth and Development Office has committed £20 million combined with a further £5 million from ourselves and other independent funders. This constitutes the Equal Safe and Free fund. In common with our own approach to grantmaking it will make grants directly to LGBTI led regional grant makers in Africa, the Caribbean and the Pacific. The Fund will start in 2024 and is a significant act of solidarity by the Government with LGBTI activists at a time of growing attacks across the world. The Fund has cross party support.

Beyond this we have maintained our approach of making major multi-year grants to the three African LGBTI grant makers. We have combined this with a small number of grants to LGBTI organisations in South Africa on the grounds that the type of funding they need is not available regionally. This direct support to activists in Africa is combined with a much smaller amount of funding for research and advocacy taking place in the UK to support activists in Africa

As in previous years, our Strengthening Civil Society Programme has supported civil society organisations to use the law for positive change especially in tackling discrimination and disadvantage. 2023 saw a particular focus on collaboration in Scotland and Northern Ireland, with the Foundation awarding grants to the Corra Foundation for a new Human Rights Fund for Scotland and to the Community Foundation Northern Ireland for the continuation of the Northern Ireland Human Rights Fund. We also awarded a new grant to the Public Law Project for its work to increase access to Judicial Review and other public law remedies by Welsh civil society.

In England, we started a new project in collaboration with the City Bridge Foundation to support civil society to use human rights based approaches in London and made a further grant to the Justice Together Initiative. The Foundation also developed a small cluster of grants focused on the planning system, as part of its strategy to enhance civil society’s use of a full range of legal tools. Alongside this work, we continued to develop our focus on racial justice in the criminal justice system through convening and commissioned research. Further grants in this area will be made in 2024 and beyond.

Towards the end of 2022, a historic and discrete donation by three members of the Baring family was converted into a spend down donor advised fund of £442,191 of which £314,794 was spent in 2023.

Full details of the Foundation's programmes and of the grants agreed during 2023 are published on the Foundation's website (www.baringfoundation.org.uk)

Achievements and performance in the delivery of public benefit

The trustees have referred to the Charity Commission's general guidance on public benefit when reviewing the charity's aims and objectives and in planning its future activities. In particular, the trustees consider how planned activities will contribute to the aims and objectives that have been set.

The Foundation has a broad social objective and employs a range of monitoring and evaluation techniques in an attempt to assess its impact. These range from a light touch self-assessment for a small grant to an independent expert assessment for large grants or programmes of grants. The results of all evaluations are reported to the trustees.

The trustees are satisfied from this information that the work funded by the Foundation remains highly in demand and serves important needs in strengthening voluntary organisations which support people experiencing discrimination and disadvantage.

In addition to the activities reported above, the Foundation seeks to be an engaged grantmaker by finding ways it can add value to the work of the organisations which it funds. The lessons derived through grantmaking are regarded as a major outcome in their own right. The Foundation frequently commissions or writes publications on areas relating to its grant programmes.

Financial review

The Trustees follow a total return strategy both for the management of the Foundation’s investment portfolio and for determining the amount available each year to fund the grants programmes and meet expenses. This amount includes both income arising from the portfolio and an element of capital growth. The objective is to at least sustain the real value of grant distributions and the long-term real value of the investment fund. To that end we budget income each year on the basis of a distribution from the portfolio equal to a percentage of the rolling average value of the investment funds over the preceding 12 quarters.

The Baring Foundation’s investment portfolio registered a year of better progress in calendar year 2023. The aggregate annual investment return of +9.7% exceeded both the Foundation’s long-term objective of CPI +4%, and the ARC Steady Growth peer group; however, relative performance compared to the strategic asset allocation (SAA) still lagged over the year, and also lagged over the past three years.

The MSCI All Country World posted a healthy rebound in 2023, rising 15.8% in sterling. This was led by a 19.7% sterling gain from the S&P 500 index in the US, which was driven in large part by a dramatic resurgence of interest in the largest global technology companies, and also by a sense that central bank policy was starting to get on top of inflationary trends.

THE BARING FOUNDATION TRUSTEES' ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Financial review (con't)

The strong performance of the so-called Magnificent Seven (Microsoft, Apple, Alphabet, Nvidia, Amazon.com, Meta Platforms and Tesla) was partly a reaction to having been oversold in the technology recession of 2022, partly due to the fact all companies launched cost reduction programmes, but mostly due to red-hot thematic interest around the growth and potential of artificial intelligence (AI). European and Japanese equities also performed strongly, posting sterling returns of 15.3% and 13.1% respectively, whilst again it was a relatively poor year for UK equities and Emerging market equities, which posted weaker gains of 7.9% and 4.1% respectively. However, equity markets generally performed very well into the end of the year as investors began to anticipate interest rate cuts given the continued improvement in inflation and comments from central banks suggested that further interest rate rises were unlikely as inflation was coming back under control. The weakest asset class through the year was UK property, which registered a 1.4% decline, but the Foundation’s exposure was lowered at the end of 2022, as this weakness was anticipated in light of the higher rate environment.

After a torrid proceeding year, the Foundation’s investment managers saw an improving trajectory of performance in calendar 2023. The Baillie Gifford portfolios posted a gain of 10.7% in sterling terms, but this double-digit gain still lagged their combined benchmark by 2.5%. The growth-tilted Positive Change and Paris-Aligned Global Alpha underperformed their benchmarks by 5.9% and 3.4% respectively, but this was partially mitigated by outperformance from Responsible Global Equity Income and Sterling Aggregate Bond of 0.5% and 1.1% respectively. The UK Alpha Fund was in-line to benchmark. The Charities Property Fund’s performance was flat over the year, outperforming its index by 1.4%, and continuing its good track record, with it now ahead of its benchmark by a ~1% p.a. over three and five years too.

Net assets at the 2023 year-end were £105.1 million (2022: £99 million).

Responsible Investment Policy

In 2022 the trustees revised their statement on this, retaining established principles but further elaborating on these in the interests of transparency. These are published in full on our website but the core of our approach is as follows: The Foundation takes a responsible and long-term approach to investment, investing predominantly through external investment managers. The Board of Trustees has overall responsibility for the Foundation's investment policy. It has an Investment Committee chaired by a Trustee with relevant experience. The majority of the endowment is invested through investment managers who have signed up to, and adhere to, the FRC UK Stewardship Code. We expect them to invest responsibly and to be proactive in considering environmental, social and governance issues. We aim to invest in responsible companies which operate with fairness and integrity, and companies that offer positive solutions to global challenges such as climate change, resource constraints and loss of biodiversity. We try to avoid exposure to underlying companies which are associated with human rights violations or engage in activities that cause social harm. We work closely with our investment managers to understand the underlying investment frameworks they use to help us monitor how well aligned their approach is with our values. We believe this approach will enable the Foundation to continue to generate attractive long-term returns and provide well-aligned liquidity for continuity of grant-making in real terms.

Reserves Policy

The Foundation’s reserves effectively correspond to its investment portfolio which is managed on a total return basis with the intention of providing an annual income that will enable the Foundation to at least maintain in perpetuity the real value of the annual grants it makes. To that end the aim is to achieve a minimum average annual return on investments of 4% plus CPI net of management fees. In addition to holding the major part of its investments in readily marketable quoted securities the Foundation aims to keep cash balances sufficient to meet short-term grant commitments and ongoing expenses. The Trustees consider that the current level of unrestricted funds of £104.6 million at 31 December 2023 meets this reserves policy.

Social investments

The Foundation holds a social investment in Charity Bank valued at £59,505 at 31 December 2023 (2022: £47,650)

Plans

In 2024 the Foundation will fund work in three fields: LGBTI civil society in Africa, and, in the UK, the use of the law by civil society for social change and arts and mental health. In addition, the Foundation will spend at least a further £600,000 focusing on racial justice through our Arts and Strengthening Civil Society programmes. The Foundation will discuss whether it should focus additional support to issues around shrinking civic space. Overall, the Foundation will seek to remain responsive to the needs of civil society and continue to develop our policies and approach in this regard. The SCS and Arts programmes will run open funding round. The Equal Safe and Free Fund with the FCDO will start operation. Trustees will also begin a scheduled review of the SCS programme. After almost five years of funding towards the end of 2024, an independent review of the Arts programme will be commissioned.

Risk assessment

During the course of the year, the trustees considered the major risks to which the Foundation is exposed and the systems which it has to mitigate them.

THE BARING FOUNDATION TRUSTEES' ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2023

Risk assessment (cont')

The following areas of risk are considered most important :

1. Return from investments falls short of targeted levels.

Investments are diversified between asset classes in line with professional advice from Stanhope who monitor performance of overall portfolio and individual managers. The Investment Committee routinely reviews the performance of investments and asset mix.

2. Programme strategies or funding criteria unclear.

Programmes are explained in detail on website and open round funding guidelines are put in place for each new call. Staff publicise funding opportunities and respond to queries from applicants.

The Foundation has policies, procedures and systems in place to address the identified risks.

Remuneration policy

The Foundation’s policy is to provide remuneration that will attract and retain able and suitably qualified and experienced individuals who will effectively deliver the Foundation's objects and supplemented where appropriate by independent experts on a consultancy basis. As far as is practicable, salaries are set by reference to the median pay for comparable positions within the charitable sector. The pay of each member of staff is reviewed annually by a committee of Trustees having regard to the financial resources and commitments of the Foundation, the impact of inflation on the real value of pay, and any recommendations of the Director. We have as a Board taken note of NCVO’s recommendations in their “Report of the Inquiry into Charity Senior Executive Pay and guidance for trustees in setting remuneration”. Our commitment to transparency is shown in disclosing the remuneration of senior staff in full in this report.

Fundraising policy

The Foundation's income is from its investment portfolio and partnerships with other grant makers. No fundraising activity is carried out by the charity.

Statement of trustees' responsibilities

The trustees (who are also directors of The Baring Foundation 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 Foundation and of the incoming resources and application of resources, including the income and expenditure, of the Foundation for that period. In preparing these financial statements, the trustees are required to:

The trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Foundation 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 Foundation and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

As far as the trustees are aware:

The trustees are responsible for the maintenance and integrity of the corporate and financial information included on the Foundation's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

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 at 31 December 2023 was 16 (2022 – 15). The trustees are the members of the charity. This entitles them only to voting rights. The trustees have no beneficial interest in the charity.

Approved by the trustees on 20 June 2024 and signed on their behalf by

......................................................

Lucy de Groot CBE - Chair Date 2nd July 2024

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF THE BARING FOUNDATION

Opinion

We have audited the financial statements of The Baring Foundation for the year ended 31 December 2023 which comprise the Statement of Financial Activities, the Balance Sheet, the Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

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 charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.

Other information

The trustees are responsible for the other information. The other information comprises the information included in the Trustees’ Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF THE BARING FOUNDATION

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Trustees’ Report (which incorporates the strategic report and the directors’ report).

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

Responsibilities of trustees for the financial statements

As explained more fully in the Statement of Trustees’ Responsibilities statement set out on page 6, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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:

Based on our understanding of the charitable company and the environment in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to data protection legislation and employment (including taxation) and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006, the Charities Act 2011, SORP 2019 and other factors such as tax and payroll.

We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls). Audit procedures performed by the engagement team included:

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF THE BARING FOUNDATION

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 noncompliance. 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.

Use of our report

This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company's members those matters we are required to state to them in an Auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's members, as a body, for our audit work, for this report, or for the opinions we have formed.

Siobhan Holmes (Senior Statutory Auditor) For and on behalf of Haysmacintyre LLP, Statutory Auditors

10 Queen Street Place London EC4R 1AG

Date: 3 July 2024

THE BARING FOUNDATION

STATEMENT OF FINANCIAL ACTIVITIES (INCORPORATING AN INCOME AND EXPENDITURE ACCOUNT) FOR THE YEAR ENDED 31 DECEMBER 2023

Notes
INCOME FROM:
Donations
- Contributions to programmes
2
- Donated services
3
Investments
4
Total income
EXPENDITURE ON:
Raising Funds
- Investment Management
Charitable Activities
- Strengthening Civil Society programme
- Arts programme
- International Development programme
- Special initiative
- Other charitable work
Total expenditure
5
Net income/(expenditure) before investment gains
Net gains/(losses) on investments
10, 11
Net income/(expenditure) and
17
net movement in funds
Total funds brought forward
Total funds carried forward		 Restricted Unrestricted
Funds
Fund
£
£
1,540,000
-
-
84,508
-
2,424,834
1,540,000
2,509,342
-
467,568
224,659
1,725,283
40,000
1,259,315
-
1,225,840
-
411,797
-
92,553
264,659
5,182,356
1,275,341
(2,673,014)
-
7,469,899
1,275,341
4,796,885
-
99,025,514
1,275,341
103,822,399		 Total
2023
£
1,540,000
84,508
2,424,834
4,049,342
467,568
1,949,942
1,299,315
1,225,840
411,797
92,553
5,447,015
(1,397,673)
7,469,899
6,072,226
99,025,514
105,097,740		 Total
2022
£
400,000
101,702
1,956,154
2,457,856
457,088
1,365,128
1,279,736
1,257,903
86,570
83,460
4,529,885
(2,072,029)
(23,681,971)
(25,754,000)
124,779,514
99,025,514

All of the above results are derived from continuing activities. There were no other recognised gains or losses other than those stated above. Movements in funds are disclosed in note 16 to the financial statements.

The statement of financial activities includes the income generated by the assets held in the investment portfolio and the net gains or losses on those investments.

All Income and expenditure in prior year was unrestricted.

THE BARING FOUNDATION

COMPANY NUMBER 950696

BALANCE SHEET AS AT 31 DECEMBER 2023

Note
FIXED ASSETS
Investments
10
Social investments
11
CURRENT ASSETS
Cash at bank and on deposit
Debtors
12
LIABILITIES
Creditors: amounts due within one
year
13
NET CURRENT ASSETS
TOTAL ASSETS LESS CURRENT
LIABILLITIES
Creditors: amounts due after more
than one year
14
NET ASSETS
16
FUNDS
17
Restricted funds
Unrestricted funds
- Revaluation fund
- General funds
Total funds		 2023
£
2,268,055
1,561,000
3,829,055
(2,567,205)		 £
104,570,385
59,505
104,629,890
1,261,850
105,891,740
(794,000)
105,097,740
1,275,341
49,903,465
53,918,934
105,097,740		 2022
£
£
95,409,261
47,650
95,456,911
6,411,911
100,000
6,511,911
(1,909,539)
4,602,372
100,059,283
(1,033,769)
99,025,514
-
42,891,164
56,134,350
99,025,514

Approved by the trustees and signed on 20 June 2024 on their behalf by:

...................................................... ............................................... Lucy de Groot CBE Ashley Coombes Chair Treasurer

THE BARING FOUNDATION STATEMENT OF CASH FLOWS YEAR ENDED 31 DECEMBER 2023

2023 2022
£ £
Cash used in operating activities (4,865,609) (4,331,258)
Cashflows from investing activities
Dividends and interests 2,424,834 1,956,154
Purchase of investments (12,023,406) (5,883,495)
Proceeds from sale of investments 10,320,325 11,615,229
Net cash provided by investing activities 721,753 7,687,888
Change in cash and cash equivalents in the reporting period (4,143,856) 3,356,630
Cash and cash equivalents at the beginning of the reporting 6,411,911 3,055,281
period
Cash and cash equivalents at the end of the reporting period 2,268,055 6,411,911
NOTES TO THE CASH FLOW STATEMENT
2023 2022
£ £
Reconciliation of net expenditure to net cash outflow from
operating activities
Net Income/(Expenditure) for the reporting period 6,072,226 (25,754,000)
(Increase) in debtors (1,461,000) -
Increase/(decrease) in creditors 417,898 (303,075)
Dividends and interest (2,424,834) (1,956,154)
(Gains)/Losses on investments (7,469,899) 23,681,971
Net cash (used in) operating activities (4,865,609) (4,331,258)
Analysis of cash and cash equivalents
Cash at bank and on deposit 2,268,055 6,411,911
2,268,055 6,411,911
Changes in net debt At 1 January Cash Flows At 31
December
2023 2023
£ £ £
Cash at bank and on deposit 6,411,911 (4,143,856) 2,268,055

THE BARING FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

1 Principal Accounting Policies

The principal accounting policies adopted, judgements, and key sources of estimation uncertainty in the preparation of the financial statements are as follows:

(a) Basis of accounting

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice for Charities (Second Edition, effective 1 January 2019), and the Companies Act 2006.

The charity meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy notes.

(b)

Donations and donated services

Income from donations is included in full in the statement of financial activities when receivable. Donated services and facilities are recognised as income where the benefit to the Foundation is quantifiable and measurable, and are valued at the estimated cost the Foundation would pay for an equivalent service or facility in the open market. Donated premises and facilities are received from ING Bank N.V. London Branch.

(c) Investment income & grants Received

Income from investments is included in the financial statements when it becomes receivable.All income is included in the statement of financial activities when the charity is legally entitled to the income, the amount can be measured with reasonable accuracy and its receipt is probable.

(d)

Grants payable

The full costs of grants are included in the statement of financial activities in the year in which they are approved. If grants that are approved during the year are payable by instalments or have not been paid, in part or in full, by the end of the year, any unpaid amounts are included as creditors in the balance sheet if the conditions attached to the grant are accepted by the beneficiary before the accounts are signed.

This policy reflects the Foundation's experience that it is highly probable that any further instalments will be paid as it is unlikely that circumstances will arise in which conditions attached to such grants are not met. The trustees consider that the Foundation has a constructive obligation in respect of such unpaid grants and therefore believe it prudent to treat these commitments as liabilities.

(e) Other expenditure Support and governance costs consist of those office and administration costs which are not directly attributed to a grant programme. The majority of these are the estimated costs of the premise and facilities donated by ING Bank N.V. London Branch. (See note 1b). The Governance percentage has doubled since 2020 because it was agreed that some types of work should moved from the “Other charitable expenditure” category to the “Governance” category.

Total support costs are allocated to the main grant programmes based on the estimated percentage of time spent by the staff on each activity. In 2023, on this basis, the support costs were apportioned as follows:

apportioned as follows:
2023 2022
Governance 12% 14%
Investment management 4% 4%
Strengthening Civil Society programme 29% 34%
Arts programme 25% 24%
International Development programme 16% 13%
Other charitable work 13% 11%
Special Initiatives 1% -

(f) Restricted funds

Restricted funds are to be used for specific purposes as laid down by the donor. Expenditure which meets these criteria is charged to the fund together with a fair allocation of management and support costs.

THE BARING FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

  1. Principal Accounting Policies (continued)

  2. (g) Unrestricted funds

Unrestricted funds are income receivable or generated for the objects of the charity.

The trustees consider that there are no material uncertainties regarding the charity's ability to continue as a going concern.

In the application of the Charity’s accounting policies, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from those estimates. The estimates, along with their underlying assumptions, are continually reviewed. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

The following critical judgement has been made in the process of applying the Charity’s accounting policies and that has the most significant effect on the amounts recognised in the financial statements:

Expenditure allocations: Expenditure is apportioned where it relates to more than one cost category as detailed within accounting policy (e).

The following is the key area of estimation uncertainty identified by management:

Valuation of donated services as detailed within accouting policy (b).

The revaluation reserve represents the difference between the historical cost of investments and their current market value.

Short-term debtors are measured at transaction price, less any impairment.

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.

The charity only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments, including trade and other debtors and creditors are initially recognised at transaction value and subsequently measured at their settlement value.

The charity recognises employee redundancy and termination costs in full on the date the redundancy or termination is confirmed.

Fixed asset investments are continuously revalued at bid price value and the value at the balance sheet date is the bid price value, as determined by the investment managers. The net gains or losses for the period are taken to the statement of financial activities.

(p) Foreign currencies

Monetary assets and liabilities denominated in foreign currencies have been translated into sterling at the relevant rates of exchange ruling at the balance sheet date, or where appropriate, the rates of exchange fixed under the terms of the relevant transaction.

THE BARING FOUNDATION NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

1. Principal Accounting Policies (continued)

(q) Pension costs

Staff from the Baring Foundation receive a pension from the ING UK Pension Fund. For historic reasons one of the staff was an admitted member of a defined benefit scheme. The liability of the scheme is with ING Bank N.V. and not the Baring Foundation.

The pension cost represents contributions payable under the scheme by the Foundation to the fund. The Foundation has no liability under the scheme other than for the payment of those contributions.

(r) Grants received

Grant income is accounted for as the charity earns the right to consideration by its performance. Where the grant is received in advance of performance its recognition is deferred and included in creditors. Where entitlement occurs before the grant is received, it is accrued in debtors.

2. Contributions to programmes

City Bridge Foundation - Restricted

£1,500,000 (2022 : Nil), joint funding, over five years, to develop and deliver a programme supporting Londonbased civil society organisations to use human rights-based approaches to address discrimination and disadvantage.

Arts Council England - Restricted

£40,000 (2022 : Nil), joint funding towards a national symposium on the power of creativity in the lives of young people with mental health problems.

3. Donated Services

Services donated by ING Bank NV:
Premises and facilities
4.
Income from Investments
Income from investments
Bank interest		 2023
£
84,508
84,508
2023
£
2,382,203
42,631
2,424,834		 2022
£
101,702
101,702
2022
£
1,943,053
13,101
1,956,154

THE BARING FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

  1. Total Expenditure - 2023
Total Expenditure - 2023
Investment Strengthening
Arts		 International Special Other Governance Support Total 2023
Management Civil Society Programme Programme Initiative charitable Costs
programme work
£ £ £ £ £ £ £ £ £
Staff costs (note 7) - - - - - - - 490,761 490,761
Grants payable (note 8) - 1,668,108 1,074,348 1,090,432 404,677 - - - 4,237,565
Investment managers’ fees 398,574 - - - - - - - 398,574
Auditors’ remuneration (note 6) - - - - - - 16,800 - 16,800
Other support costs - 64,416 46,981 21,497 - - - 129,905 262,799 *
Investment consultants’ fees 40,516 - - - - - - - 40,516
439,090 1,732,524 1,121,329 1,111,929 404,677 - 16,800 620,666 5,447,015
Allocated support costs 24,827 179,992 155,167 99,307 6,206 80,687 74,480 (620,666) -
Allocated governance costs 3,651 37,426 22,819 14,604 914 11,866 (91,280) - -
Total expenditure 467,568 1,949,942 1,299,315 1,225,840 411,797 92,553 ** - - 5,447,015

THE BARING FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

5 a. Total Expenditure - 2022

Total Expenditure - 2022
Investment Strengthening
Arts		 International Special Other Governance Support Total 2022
Management Civil Society Programme Programme Initiative charitable Costs
programme work
£ £ £ £ £ £ £ £ £
Staff costs (note 7) - - - - - - - 451,398 451,398
Grants payable (note 8) - 1,021,389 1,076,599 1,149,682 86,570 - - - 3,334,240
Investment managers’ fees 392,163 - - - - - - - 392,163
Auditors’ remuneration (note 6) - - - - - - 14,880 - 14,880
Other support costs - 100,430 36,213 17,804 - - - 145,652 300,099 *
Investment consultants’ fees 37,105 - - - - - - - 37,105
429,268 1,121,819 1,112,812 1,167,486 86,570 - 14,880 597,050 4,529,885
Allocated support costs 23,882 197,027 143,292 77,617 - 71,646 83,586 (597,050) -
Allocated governance costs 3,938 46,282 23,632 12,800 - 11,814 (98,466) - -
Total expenditure 457,088 1,365,128 1,279,736 1,257,903 86,570 83,460 ** - - 4,529,885

THE BARING FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

Net Expenditure for the Year
This is stated after charging:
Trustees' reimbursed expenses
Auditors' remuneration
- For audit of the financial statements
- Other services
2023 Audit Fee £16,800 (gross of VAT), £14,000 (net of VAT).		 2023
£
5,831
16,800
18,900		 2022
£
2,511
14,880
18,000

Trustees' reimbursed expenses represent the reimbursement of travel and subsistence costs of £5,831 (2022: £2,511) relating to attendance at meetings (6 trustees). No trustees have been remunerated for their role.

7.
Staff Costs and Numbers
Staff costs were as follows:
Salaries and wages
Social security costs
Pension contributions		 2023
£
388,749
43,970
58,042
490,761		 2022
£
356,171
42,119
53,108
451,398

Key management and salary pension

The following staff comprise key management and their remuneration is as follows: £100,000 - £110,000 - David Cutler - Director salary £109,166 (2022: £100,250), employer's NI £13,809 (2022: £13,507) and pension £19,104 (2022: £17,544).

£80,000 - £89,999 - David Sampson - Deputy Director salary (4.5 days per week) £82,873 (2022: 76,104), employer's NI £9,976 (2022: £9,780) and pension £10,359 (2022: £9,513).

The average number of staff during the year was: 6 (2022: 6). The number of staff earning over £60,000 in the year was 3 (2022: 2).

8.
Grants Payable
The grants payable figure in 2023 comprises:
Grants made in the year
Grants cancelled/written back		 2023
£
4,251,065
(13,500)
4,237,565		 2022
£
3,334,240
-
3,334,240

All grants were made to institutions.

There is a full list of the grants made during the year on the Baring Foundation's website (www.baringfoundation.org.uk).

9. Taxation

The charitable company is exempt from corporation tax as all its income is charitable and is applied for charitable purposes.

THE BARING FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

10.
Investments
Market value of investments at 1 January
Disposals at market value
Additions at cost
Net gain/(Losses) on investments
Market value of investments at 31 December
Historical cost of investments at 31 December
Pooled Investments comprise
UK
Non UK
11.
Social Investments
Opening carrying value
Net gain on investments
Closing carrying value
Held as:
Investments		 2023
£
95,409,261
(10,320,325)
12,023,406
7,458,043
104,570,385
101,268,519
2023
£
104,564,097
6,288
104,570,385
2023
£
47,650
11,855
59,505
59,505		 2022
£
124,827,316
(11,615,229)
5,883,495
(23,686,321)
95,409,261
100,810,922
2022
£
95,394,053
15,208
95,409,261
2022
£
43,300
4,350
47,650
47,650

£59,505 is invested with Charity Bank. Charity Bank provides loans to charities, social enterprises and community organisations to facilitate social change whilst earning a financial return.

12. Other Debtors and Accrued Income

Other Debtors and Accrued Income
Accrued contributions to programmes and income in investment funds
Dividend Accrual		 2023
£
1,425,000
136,000
1,561,000		 2022
£
100,000
-
100,000

THE BARING FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

13. Creditors: Amounts due within one year

13.
Creditors: Amounts due within one year
Grants authorised but not yet paid
Other creditors
14.
Creditors: Amounts due after more than one year
1-2 years - grants authorised but not yet paid		 2023
£
2,414,707
152,498
2,567,205
2023
£
794,000
794,000		 2022
£
1,766,287
143,252
1,909,539
2022
£
1,033,769
1,033,769

15. Related party transactions

As is usual in a grantmaking foundation, a number of the trustees, staff and advisers of the Baring Foundation are involved in other charities, either as staff or volunteers. The charity holds a record of all conflicts of interest and where trustees, staff and advisers have a conflict of interest they have no part in the decision-making process. The following trustees had conflicts of interest in 2023.

Fiona Bawdon, business partner of Trustee, Shauneen Lambe, was commissioned by the Baring Foundation to run a communications workshop for all grantees.

Trustee, Shauneen Lambe, is a Director of Youth Justice Legal Centre. Existing grantee, Youth Justice Legal Centre are scoping work related to policing in schools, an area which the Committee agreed to focus on in the coming two years.

Trustee, Judith Robertson, was involved in research work related to the establishment of the Independent Human Rights Fund for Scotland, but has not been involved with it since, nor going forward. A grant of £300,000 was made to the Corra Foundation for the establishment of the Independent Human Rights Fund for Scotland.

THE BARING FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021

16. Analysis of Net Assets Between Funds - 2023

Investments
Net current assets
Creditors: amounts due after more than one year
Net assets at the end of the year
Analysis of Net Assets Between Funds - 2022
Investments
Net current assets
Creditors: amounts due after more than one year
Net assets at the end of the year
17.
Net Movement in Funds - 2023
Restricted funds
Strengthening Civil Society
Arts Council
Total restricted funds
Unrestricted funds
Revaluation reserve
General funds
Total unrestricted funds
Total funds		 Restricted
Fund
£
-
1,275,341
-
1,275,341
Restricted
Fund
£
-
-
-
-
At the start
of the year
£
-
-
-
42,891,164
56,134,350
99,025,514
99,025,514		 Revaluation
Fund
£
49,903,465
-
-
49,903,465
Revaluation
Fund
£
42,891,164
-
-
42,891,164
Income
£
1,500,000
40,000
1,540,000
-
2,509,342
2,509,342
4,049,342		 General
Fund
£
54,726,425
(13,491)
(794,000)
53,918,934
General
Fund
£
52,565,747
4,602,372
(1,033,769)
56,134,350
Expenditure/
gains on
investments
£
(224,659)
(40,000)
(264,659)
7,012,301
(4,724,758)
2,287,543
2,022,884		 Total
2023
£
104,629,890
1,261,850
(794,000)
105,097,740
Total
2022
£
95,456,911
4,602,372
(1,033,769)
99,025,514
At the end
of the year
£
1,275,341
-
1,275,341
49,903,465
53,918,934
103,822,399
105,097,740

The revaluation reserve represents the difference between the historical cost of investments and their current market value.

THE BARING FOUNDATION

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021

17. Net Movement in Funds - 2023 (con't)

Purposes of restricted funds

City Bridge Foundation

Joint funding, over five years, to develop and deliver a programme supporting London-based civil society organisations to use human rights-based approaches to address discrimination and disadvantage.

Arts Council England

Joint funding towards a national symposium on the power of creativity in the lives of young people with mental health problems.

18 Net Movement in Funds - 2022

Net Movement in Funds - 2022
At the start Expenditure/
At		 the end
of the year Income losses on
of		 the year
investments
£ £ £ £
Restricted funds
Strengthening Civil Society - 400,000 (400,000) - -
Total restricted funds - 400,000 (400,000) -
Unrestricted funds
Revaluation reserve 65,202,745 - (22,311,581) 42,891,164
General funds 59,576,769 2,057,856 (5,500,275) 56,134,350
Total unrestricted funds 124,779,514 2,057,856 (27,811,856) 99,025,514
Total funds 124,779,514 2,457,856 (28,211,856) 99,025,514