HEART OF THE CITY ANNUAL REPORT 2013/14

Transcription

1 HEART OF THE CITY ANNUAL REPORT 2013/14 Putting CSR at the heart of business

2 Heart of the City Annual Report 2013/14 Heart of the City of London Limited (A Company Limited by Guarantee) Directors-Trustees Report and Financial Statements for the year to 31 March 2014 Charity Number: Company Number:

3 Heart of the City Annual Report 2013/14 Contents 1 CONTENTS Reference and Administration Details 2 Message from the Chairman 5 Chief Executive s Statement 6 What we do 7 Objectives and Activities for the Public Benefit 8 Achievements and Performance 10 Future Plans 17 Structure, Governance and Management 18 Financial Review 20 The Financial Statements 21 Auditors Report 22 Statement of Financial Activities for the year ended 31 March Balance Sheet as at 31 March Notes to the Financial Statements 26

4 Heart of the City Annual Report 2013/14 Reference and Administration Details 2 REFERENCE AND ADMINISTRATION DETAILS CHARITY NAME Heart of the City of London Limited CHARITY NUMBER COMPANY NUMBER REGISTERED ADDRESS 6 St Andrew Street, 5th Floor, London, EC4A 3AE OPERATIONAL ADDRESS Economic Development Office, Guildhall, London, EC2P 2EJ COMPANY SECRETARY TMF Corporate Secretarial Services, 6 St Andrew Street, 5th Floor London, EC4A 3AE BANKER Lloyds TSB Bank plc, City Office, PO Box 72, Bailey Drive, Gillingham, Kent, ME8 OLS AUDITOR Deloitte LLP, 3 Victoria Square, Victoria Street, St Albans AL1 3TF DIRECTORS-TRUSTEES Harvey McGrath (Chairman) Richard Hardie (Deputy Chairman) Gill Parker Sushil Saluja Peter Sherratt Liz Skelcher Charlotte Cowley (appointed 17 October 2013) Matt Sparkes (appointed 7 May 2013) Gay Harrington (appointed 17 October 2013) Vicky Mirfin (resigned 10 December 2013) Ian Rodger (resigned 15 December 2013) Nina Kowalska (resigned 14 December 2013) CHIEF EXECUTIVE Carolyn Housman TREASURER City of London Corporation DIRECTORS-TRUSTEE DETAILS HARVEY MCGRATH Harvey McGrath is Chair of Big Society Capital, Chair of Governors at Birkbeck College, Deputy Chair of the London Enterprise Panel and a former Chairman of Prudential plc. He served as both Chairman and CEO of Man Group among many other senior roles, including Chairman of the London Development Agency, Chairman of London First, Director of Gateway to London and Chairman of the East London Business Alliance. He is a founding donor and trustee of New Philanthropy Capital, Chairman of the Prince s Teaching Institute, Chairman of icould, President of Children and Families across Borders (CFAB), and a trustee of the Mayor s Fund for London. RICHARD HARDIE Richard Hardie was COO of UBS Investment Bank, EMEA, until 2006 and was non-executive Chair of the Learning Trust in Hackney from He currently is the nonexecutive Chair of UBS Ltd and is a Governor of The Bridge Academy, Hackney, sponsored by UBS. Richard was named The Prince of Wales Business in the Community (BITC) Ambassador for London for 2007 and is BITC s London lead on education. He is an Honorary Vice- President of the Chartered Institute of Linguists. He is on the Governing Body of Lincoln College, Oxford and a member of the Circle of Patrons at INSEAD Business School.

5 Heart of the City Annual Report 2013/14 Reference and Administration Details 3 GILL PARKER Gill Parker is Managing Director at BDG architecture + design, part of the WPP Group. She is Chair of Trustees Board of the Whitechapel Mission a charity that cares for the homeless of London. SUSHIL SALUJA Sushil Saluja has over 25 years experience of consulting, outsourcing and business management across a variety of blue chip clients in Financial Services in the UK and globally. He works for Accenture, and is Senior Managing Director, Financial Services, working with blue chip clients across multiple geographies and regions, UK, Europe and Asia. He also serves on the board of TheCityUK, the promotion body for Financial Services in the UK. PETER SHERRATT Peter Sherratt is a Barrister and Independent Consultant in the financial sector who first got involved with Heart of the City by joining the Council of Members in While Vice Chairman and Chief Legal Officer of Lehman Brothers Europe, Middle East & Asia, he acted as Chair of Lehman Brothers European Charitable Foundation and established a reputable philanthropy programme. Currently, Peter is Chair of Oaklands Secondary School, Stebon Primary School, and was one of the founding Board members of the Tower Hamlets Education and Business Partnership. Peter is the Chair of the Lehman Brothers Foundation and also serves on the Boards of the KPMG Foundation, the Against Malaria Foundation, Camfed International, and the Oxford Said Business School. LIZ SKELCHER Liz Skelcher is Assistant Director of Economic Development at the City of London Corporation where she has led the development and management of comprehensive regeneration and community affairs programmes. CHARLOTTE COWLEY Charlotte Cowley is the Marketing Director at Columns and has worked in brand creation, communications and marketing for 24 years. Prior to joining Columns, she worked for Diageo, The Partners (the WPP owned brand consultancy) and 300million. MATT SPARKES Matt Sparkes is the Head of Corporate Responsibility at Linklaters, leading their collective responsibility approach to responsible business. Prior to this, Matt was at Groundwork where he set up and developed a new branch of this regeneration charity in Corby in the East Midlands. Matt is a founder member and director of the Institute of Corporate Responsibility & Sustainability (ICRS), an advisor to the Living Wage Foundation and is Trustee of several charities in London and Surrey. GAY HARRINGTON Gay Harrington is the Social and Economic Manager at Canary Wharf Group working with local companies to maximise business opportunities and the local community on a range of regeneration and community activities, including the local employment, Training and Education initiatives. She is also the Director of the East London Business Place, which is currently delivering Fit for Legacy, a procurement support programme part financed by the European Regional Development Fund and is about to begin delivery of a new two-year phase of the Ready to Supply the City procurement support programme aimed at bringing together City-based businesses/their supply chains and Small, Micro and Medium Enterprises (SMME) based in the City s neighbouring fringe boroughs.

6 Heart of the City Annual Report 2013/14 Reference and Administration Details 4 COUNCIL OF MEMBERS The Rt Hon. The Lord Mayor of the City of London President Heart of the City Governor Mark Carney President Heart of the City Harvey McGrath Chairman Heart of the City Richard Hardie Deputy Chairman Heart of the City, Chair of UBS Ltd. Inga Beale Chief Executive Officer Lloyd s of London Jeremy Bennett CEO EMEA Nomura International plc Mark Boleat Chairman, Policy and Resources Committee City of London Corporation Richard Chartres Bishop of London Church of England Tim Clement-Jones London Managing Partner DLA Piper UK LLP Simon Collins UK Chairman and Senior Partner KPMG David Cruickshank Chairman Deloitte LLP Robert Elliott Senior Partner Linklaters LLP John Griffith-Jones Chairman Financial Conduct Authority Sebastian Grigg Managing Director Credit Suisse Group AG Gerry Grimstone Chairman TheCityUK Will Lawes Senior Partner Freshfields Bruckhaus Deringer Simon Mackenzie-Smith Chairman of UK and Ireland, Corporate and Investment Banking William Maltby Senior Adviser, Investment Banking Deutsche Bank Ruby McGregor-Smith CBE ACA Chief Executive MITIE Bank of America Merrill Lynch Ian Powell Chairman and Senior Partner PricewaterhouseCoopers Antonio Simoes CEO UK & Head of Retail Banking and Wealth Management Europe for HSBC HSBC Bank plc Malcolm Sweeting Senior Partner Clifford Chance LLP Brian Winterflood Life President Winterflood Securities

7 Heart of the City Annual Report 2013/14 Message from the Chairman and the CEO 5 MESSAGE FROM THE CHAIRMAN A REFLECTION ON 2013/14 Trust in business to act responsibly whether in relation to its people, its customers, or its tax obligations - has been further damaged in 2013/14 by a string of disclosures and actions by the authorities. So our role as Heart of the City, helping drive responsible business practice across our network of members, is as relevant and important as ever. During the year, in a direct response to the continued levels of high youth unemployment, we launched our SchoolstoBusiness initiative to aid small businesses to better equip young people with the skills they need to get, and keep, a job. Our open-source platform helps small and medium-sized businesses connect with local schools in the area of employability education. Its success attracted national attention and in 2014 we will roll the platform out nationally. We also developed and strengthened services to our more than 500 graduated Newcomer businesses, through our Alumni membership programme. Our Alumni programme allows former Newcomers to continue their Corporate Social Responsibility (CSR) learning and to benchmark their work against peers. We partnered with the City Philanthropy initiative to help promote a culture of giving to the voluntary sector. The rally for support resonated with our businesses in the Newcomer programme; collectively these businesses gave nearly 3,000,000 to charitable causes in 2013/14. We conservatively estimate that 19,191 employee volunteer hours - or 11 years of work time - were given to the community through our Newcomers employee volunteering programmes. Our Newcomers enthusiasm for community initiatives is matched by their responsibility in other areas of CSR. More than half of our Newcomers reduced their energy consumption and 42% reduced their waste by recycling more. 61% saw improved staff behaviour change on environmental issues. Of our Newcomers which are involved in responsible procurement, 61% of sourced goods and services from local suppliers, helping to increase the multiplier effect to kick start the UK economy. 59% source from green suppliers. Moreover, I am pleased to report that 40% of our Newcomers introduced CSR as a consideration when developing new products and services. Our business members understand what it means to put responsibility at the heart of their business, which is why we have grown to be a 700-strong powerhouse of responsible business leaders, CR practitioners and change agents committed to sharing their experiences and their time with others in order to measurably improve our society here in the City of London, our City fringes and beyond. Harvey McGrath Chairman

8 Heart of the City Annual Report 2013/14 Message from the Chairman and the CEO 6 CHIEF EXECUTIVE S STATEMENT WHAT TO EXPECT IN 2014/15? The last five years witnessed a seismic shift in our economy and our society, requiring us to readjust our long-term strategy. Going forward, we will strengthen our distinctive positioning in the marketplace, ensure effective and efficient delivery methods to keep costs low for our members and continue to build our reputation within our community. This includes being recognised as the leading Corporate Social Responsibility (CSR) network for small business in the UK. With over 300 SMEs in our network, we are a major influence in helping to promote the difference that small businesses can make. Many smaller companies, accounting for 99.9% of UK private sector businesses, are still awakening to the risk and opportunities of a responsible business model. It is still an unfamiliar and challenging undertaking, with good intentions often limited by scarce resources. Many say that they find the CSR support services landscape confusing, so we must make it easy for our members to navigate the CSR marketplace to improve their programmes. Fortunately, feedback is that the team is very approachable and are always quick to respond to our members needs. In fact, two of our small business members recently won awards for their CSR work. K&M McLoughlin Decorating Ltd, with 90 employees, won a Dragon Award in 2013 for setting up an apprenticeship programme, retaining over 90% of qualified apprentices into the company. Sapphire Systems is another illustration of success. They started a community programme in 2010 and won a Dragon Award in 2012 with 50% of their 96 employees volunteering across projects including a school partnership championed by their CEO. There is still scope for us to improve on our links with the City and our strong Financial and Professional Business Service (FPBS) client base. The history and culture of Heart of the City is deeply entrenched in financial and related services. In addition to building more relevant FPBS CSR materials, we will continue to strengthen our relationship with TheCityUK through their Chairman s participation on our Council of Members and with the City Values Forum. With the Governor of the Bank of England sharing the helm with the Lord Mayor as co-presidents from 2014, we are well placed to support businesses in their pursuit of inclusive capitalism. THE GOODWILL THAT CONTRIBUTED TO OUR SUCCESS As a small charity, we could not achieve our success without the support of others. First and foremost, our Trustees led by our Chairman, Harvey McGrath provide sound advice and good governance to our work. Sitting above our Board, our Council Members are beacons of best practice and champions of our work. Two Council Members went above and beyond to lend us teams to support our diagnostic reporting and our SchoostoBusiness website. We are thankful to Ed Greig from Deloitte and to Andrew Pope and Rob Wilson from PricewaterhouseCoopers. We are particularly grateful to Adam Garfunkel, of Junxion Strategy, who is assisting us with taking our communications forward in At the foundation of our collaboration and success is unsurprisingly a passionate team. This includes our core, operational team as well as John Condon, a secondee from Groundswell. It also includes the wider team within which we sit the City of London Corporation. The finance team, particularly Ray Green and Geraldine Francis, have been hugely helpful in preparing this report. As Helen Keller so eloquently observed: Alone we can do so little; together we can do so much. Carolyn Housman Chief Executive

9 Heart of the City Annual Report 2013/14 What we do 7 WHAT WE DO Heart of the City is a network of responsible businesses, including senior leaders, Corporate Responsibility practitioners and change agents committed to sharing their experiences and their time with others in order to deliver long term benefits, impact and measureable outcomes of their business and wider community. Our learning programmes offer a way for every company and every individual to develop their Corporate Social Responsibility (CSR) initiatives. We focus our activities on: Our Newcomers programme offers a free programme for businesses new to CSR. Support is provided via a series of workshops, business mentoring, 100+ online resources and a dedicated project manager. The programme covers all areas of CSR including volunteering, reducing businesses environmental impact, improving employee wellbeing and sustainable procurement. Our Alumni programme is designed for our members who have successfully completed the Newcomers programme and who are looking for continuous support in order to progress their CSR initiatives. The programme offers packages for businesses in different phases of development and/or preferences for engagement to keep learning and sustaining best practices. Members have access to learning events throughout the year, an online platform which incorporates the latest CSR research, expert mentors, tailored advice and a combination of tools for tracking progress, health checks, benchmarking and sector analysis. Our SchoolstoBusiness intiative provides SMEs practical ways they can engage and equip young people with employability skills. Our online platform helps tackle youth unemployment by providing free of charge, lesson plans, resources and case studies to encourage and support SMEs to volunteer in schools. Our network Our Newcomers are businesses that are new to CSR and are participating in our Newcommers programme. Our Alumni are companies that have completed our Newcomers programme. Those who have graduated from the Newcomers programme and are continuing their CSR journey with us, are our Alumni members. Our Contributors are businesses with expertise in CSR which also have the capacity to give back. They share their knowledge, experience and resources to support Heart of the City to achieve its mission - to support businesses in our network to develop and embed best practice CSR businesses, including 55 Newcomers, 550 Alumni and 100 Contributors 350 financial and professional business firms 350 small to medium-sized businesses

10 Heart of the City Annual Report 2013/14 Objectives and Activities for the Public Benefit 8 OBJECTIVES AND ACTIVITIES FOR THE PUBLIC BENEFIT WHO WE ARE Heart of the City is a 700-strong network of responsible business leaders, Corporate Responsibility practitioners and change agents committed to sharing their experiences and their time with others in order to measurably improve our society. OUR PURPOSE Our purpose is to work with London businesses to develop and share effective and inspiring Corporate Social Responsibility (CSR) programmes. 8 London boroughs are eligible for membership: Camden, City of London, Hackney, Islington, Lambeth, Southwark, Tower Hamlets and Westminster 82% of the 2013 Newcomers developed a CSR strategy since joining the programme

11 Heart of the City Annual Report 2013/14 Objectives and Activities for the Public Benefit 9 OUR CHARITABLE OBJECTS We promote the voluntary sector for the benefit of the public by: promoting charitable giving by companies and organisations and encouraging individuals to participate in voluntary work providing education and training on subjects relevant to the efficiency of the voluntary sector assisting in the provision of financial, technical and other resources to the voluntary sector the Directors-Trustees having due regard to the Charity Commission s public benefit guidance when setting objectives and planning activities Our four key Objectives in 2013/14 that enabled us to fulfil our Charitable Objects: 1. To inspire businesses that are new to the area of CSR to start their own programmes. 2. To provide practical support to these businesses as Newcomers and thereafter through our Alumni work to help them embed sustainable programmes. 3. To raise awareness of the effectiveness of community engagement and environmental responsibility programmes for the public benefit by showcasing models of good practice. 4. To maximise the reach and impact of our programme for the benefit of the public by inspiring the ongoing commitment of current and future funders, and our business volunteers. The Activities we undertook in 2013/14 to meet these objectives: 1. Inspiring and educating 61 businesses on our 2012 Newcomers programme to contribute positively to their surrounding communities and environment. Of our intake, 77% were small to medium sized enterprises (SMEs) and 45% were financial and professional business service firms (FPBS). 2. Expanding our online tools to help businesses avoid unnecessary development effort and to enable them to spend more time and money on embedding sustainability in community engagement programmes. 3. Working in partnership with more charities to provide more effective referrals and co-hosting more events to expand our offering to members. 4. Engaging with senior leaders to illustrate the importance of our work by inviting them to major leadership events, such as Mansion House, The Senior Leaders Breakfast. 5. Profiling best practice within our network through case studies, speaking opportunities at events and features in our monthly newsletters. 6. Building on the pilot phase of SchoolstoBusiness to increase uptake, and devising a communications and marketing campaign to further engage SMEs in employability education to help address growing youth unemployment. 7. Amplifying our communications and engagement, ensuring sustainable growth of our business network year on year, and positioning Heart of the City in the CSR intermediary market and amongst wider audiences. 8. Providing continuous learning and development opportunities for our Alumni network through our membership programme, by bringing together businesses who want to take their CSR to the next level and become leaders in responsible business through their positive impact on society. TOP 3 Newcomers report that the top 3 benefits of setting up CSR are: Improved staff morale (96%), Improved employee skills (89%) and Raised brand profile (83%) 76% of Newcomers established a CSR policy demonstrating the importance of the programme, forming a robust CSR strategy aligned with core business

12 Heart of the City Annual Report 2013/14 Achievements and Performance 10 ACHIEVEMENTS AND PERFORMANCE Last year we indicated that in order for companies to establish successful CSR programmes, a key focus for us would be to ensure that our Newcomers programme continues to be efficiently run and well-regarded and that our plans are successfully carried out to generate revenue to cover the costs of our operational team. The section below illustrates how we met these objectives by supporting our business network through our Newcomer and Alumni programmes. a. HELPING BUSINESSES TO DEVELOP EFFECTIVE CSR PROGRAMMES We strive every year to improve both the quality of our Newcomers programme and the efficiency with which we deliver it. In 2013, as we focused on increasing communications, engagement and our value proposition, we continued to enhance our performance. Specifically, we provided the following services: We ran three half-day CSR workshops involving 61 Newcomers and 30 Contributors acting as table discussion hosts and/or speakers. We held 280 face-to-face meetings with Newcomers and Contributors to monitor their progress and the effectiveness of our work. 53% of Newcomers required a Contributor mentor, and we met those requirements. We updated our entire library of online CSR best practice tools (100+ tools) and added new ones, including Interesting environmental stats, London Living Wage, Employee wellbeing self-assessment, Employee volunteering impact report, and Dragon Awards guidance - timeline and top tips. We compiled CSR progress reports with all participants in the Newcomers programme. We delivered two high-profile leadership events both held at Mansion House, The Senior Leaders Breakfast for potential Newcomers with 136 attending, and our Annual Network Reception for Contributors, Alumni and 2013 Newcomers with 142 senior leaders attending. The table below shows participants ratings of our Newcomers programme. We displayed particular strengths in 1:1 support from the Project Managers, networking, workshop delivery and the CSR materials we provided. These are also the parts of the programme most NEWCOMERS PROGRAMME SERVICE RATINGS Overall Excellent Content and delivery of e-bulletin 1:1 mentoring/advice from Contributors 1:1 support from the Project Managers Networking Workshops Very good Good Average Poor Not used Materials and templates

13 Heart of the City Annual Report 2013/14 Achievements and Performance 11 utilised by members. We need to improve the newsletter delivery and content, and the organisation and delivery of mentoring. We have already implemented some ideas to do so, and are looking at how to assist Newcomers further with challenges in developing their CSR programmes from lacking/ having a small budget to setting up a programme from scratch and operating without CSR colleagues. Community engagement strategies and Environment strategies The above ratings are about inputs; the real value of our work is measured on the Newcomers who have completed our programme through the effect on the companies behaviour and level of community engagement. Were they really inspired by our programme to step up their CSR activities? How effective were their efforts to make a difference in their communities and/or environment? We monitor the activities of our Newcomers carefully and maintain statistics on performance indicators, of which the following are, in our view, key. In : Our Newcomers gave an estimated total of 19,191 employee volunteer hours, the equivalent of 11 years of work time, to projects in their communities. 47% of these Newcomers have developed formal volunteering time-off policies to help ensure that their companies efforts will be sustainable. The top three causes they supported were education and young people, health and environment. 44% of our Newcomer businesses started making charitable donations and 50% developed intiatives to support staff fundraise during work time. For this cohort of Newcomers, we found that, for every 1 invested in Heart of the City, 11 was given by Newcomers to charitable causes. Compared to the previous year the figure is slightly lower, however this cohort gave more in both volunteering and gifts in kind. Environment stategies Our periodic survey of Newcomers in recent years has revealed a strong commitment among small companies to reduce their impacts on the environment. We continue to provide guidance through our tools and engage with some of our most sophisticated Contributor businesses and experts in our network to provide templates, workshops and mentoring in this increasingly important area. We monitored the effects of these initiatives for : We saw a reduction of 21% on average in carbon emissions amongst those Newcomers which measured their footprint.

14 Heart of the City Annual Report 2013/14 Achievements and Performance 12 Of the Newcomers that were not already undertaking the below items before joining Heart of the City, we saw the following improvements. 61% put in place initiatives aimed at changing staff behaviour change 56% developed energy consumption reduction programmes 42% developed waste reduction and recycling activities 34% started to purchase from sustainable sources/suppliers We believe that the indicators above demonstrate that Heart of the City s work is having a large impact on the SMEs environmental footprint and on their communities in and around the City of London. We believe that our focus on SMEs and our policy of offering the programme without charge to those companies which lack the resources, knowledge and time to start their environmental initiatives, and more widely their CSR programmes, is a compelling formula. b. HELPING BUSINESSES TO FURTHER DEVELOP CSR PROGRAMMES As our Newcomers graduate, we continue to support them as they take their CSR to the next level. Our Alumni programme provides access to networks and insight to help businesses evolve and improve their CSR initiatives. The programme includes access to intermediate to advanced CSR insight through online and offline platforms at very accessible membership fees which are tiered by company sizes. The revenue generated by the Alumni programme contributes towards maintaining our core team. In 2013/14, we added to our service offering to assist our members who wanted to do more within their CSR programme and embed it further into their businesses demonstrating a real commitment to improve society over the long term. We initiated the design of a Benchmarking tool enabling our members to compare their CSR programme based on businesses of similar size and sector. c. SCHOOLStoBUSINESS The SchoolstoBusiness initiative was piloted in June and July 2013 with 15 SMEs focusing on the boroughs of Southwark and Islington. Over 700 young people were supported with the development of their employability skills during the initial pilots. During the pilot phase we had 11 other SMEs and 19 schools outside of the pilot region express their interest in the initiative. The initial pilots in selected areas of London were a great success and we have had positive feedback from the businesses and schools which were involved. Since the SchoolstoBusiness website was launched in May 2013 and during the period up to March 2014, the platform has had 2,098 visits and the resources have been downloaded 997 times. The website has attracted attention in cities around the UK such as Manchester, Cardiff, Norwich. In 2013/14, our initiative feedback had been positive from those who had participated in the pilot phase. SMEs found the resources to be straightforward and easy to amend to reflect their businesses and how they operate. Schools found that the initiative raised the aspirations of the students as they were given the opportunity to meet and speak with professionals from various backgrounds such as law and accountancy, which many may have thought were careers out of their reach. The success of the pilot phase highlights the desire of SMEs to engage with schools in respect of employability education, helping to decrease the number of unemployed youths and prevent the growth of young people Not in Education, Employment or Training (NEETs). With the huge interest shown in the pilot boroughs and outside the pilot region, the next phase is for SchoolstoBusiness to be rolled out nationally in d. CONNECTING OUR NETWORK TO ACHIEVE MORE In order to ensure that our supporters are sufficiently engaged in our programme and understand its value, we engage senior leaders and encourage collaboration across our network. All Heart of the City businesses are encouraged to receive and share their CSR knowledge and experience, and to provide support to each other to create more impactful CSR programmes. This included: Partner Leadership Events We invited over 70 businesses to attend the Lord Mayor s 26th Dragon

15 Heart of the City Annual Report 2013/14 Achievements and Performance 13 Awards dinner at Mansion House. At this prestigious event, businesses with excellent corporate community involvement (CCI) programmes in London are recognised. This demonstrated the significance of CCI to our businesses at the start of their CSR journey and revealed what success could look like. One of our Newcomers, K & M McLoughlin Decorating Ltd. won an award for their five week pre-apprentice/ employability training course at a local college (a case study of their work is provided on page 14. Knowledge Sharing We spread CSR knowledge within our internal and external networks by: Sending them a monthly newsletter with over 1,200 receipients. Every month we introduce a new theme, publish exemplary case studies on how our network is changing communities for the better, including CSR articles, events and career opportunities. Extending our communication channel to include Twitter. Referring businesses to existing partner resources via our website, such as Inspiring the Future which helps businesses find volunteering opportunities with their local schools. These communication and marketing channels are to increase our engagement capacity and impact within our network and wider stakeholder group, as well as to foster further collaboration efforts. Collaboration Other activities we undertook were: Stimulating our City-based businesses to develop their employee volunteering programmes by referring to City Action, the City of London s free volunteering brokerage service. We also invited our Newcomers to join the City Action community tours, on which businesses visit charities and hear first-hand about the value of volunteering and how they can help. Where we were unable to offer assistance, we referred businesses to other organisations which were interested in supporting employee volunteering programmes, such as Tower Hamlets EBP and Camden Volunteering Centre. Collaborating with King & Wood Mallesons SJ Berwin, TheCityUK and the Charities Commission to host a leadership event for the Alumni programme. Sharing expertise by forming relationships between Contributors and Newcomers. A case study with Dovetail Furniture Company (Newcomer) and BDG architecture + design (Contributor) on page 15 highlights the positive impact of these relationships. Strengthening the delivery of our collaborative business-led intiative -SchoolstoBusiness, which aims to increase SME engagement with schools and help tackle youth unemployment by equipping youths with employability skills, we continued to engage with several intermediaries in the Advisory panel. Referring a number of our Newcomers to other organisations to assist with implementation of their community work. To help the Newcomers understand other organisations work and how they address community needs with business support, we held charity advice surgeries. These sessions enabled us to amplify our engagement opportunities if there was an alignement between the charity and our network which would enhance their impact. Also they acted as a communication platform to showcase charities good work by including them in our newsletter and mapping tools, thereby raising awareness of community partnerships. Over the year, we referred our businesses to over 350 charitable and intermediary organisations that could help with the delivery of their community programmes.

16 Heart of the City Annual Report 2013/14 Achievements and Performance 14 CASE STUDY: K&M MCLOUGHLIN DECORATING LTD BACKGROUND K&M McLoughlin Decorating Ltd (K&M) is a family owned business and one of the largest painting and decorating companies in London and the Southeast. Over the last 20 years, they have been running the K&M School Apprenticeship College, an apprenticeship programme. As part of the Heart of the City s Newcomers programme in 2012 they won a Dragons Award for their Introduction to Work programme in The company felt the Newcomers programme helped them develop their initiative, highlighting in particular, the amount of support provided by project managers as well as the opportunity to network with businesses on a similar journey. K&M found the commitment to the programme to be easily manageable given the length of the programme and the Mansion House recruitment event as an invaluable experience, where knowledge and experience of CSR was shared. They have since joined the Alumni membership programme as it provides continuous support with no dedicated CSR department to keep them focused on their CSR goals and ability to measure the effects of their work. THE PROJECT The Introduction to Work preapprenticeship course aimed to give locals aged 16-24, free practical and employability skills upon entering the workforce. From their apprenticeship programme, K&M identified that the drop out of new starters was extremely high since many apprentices did not have the practical skills or work ethic required for employment. The company identified ways it could improve employment skills and genuine interest in the construction industry. Subsequently, the preapprenticeship and employability programme was created in partnership with Islington Best Team and City and Islington College. The programme provides mentoring from skilled K&M tradespersons and trainers. Students are taught the importance of punctuality, commitment, teamwork, and rules and regulations. They are given training in painting and decorating and the opportunity of gaining a CSCS card so that by the end of the course, each student will be able to go on site work-aware and ready for further training in the Construction Industry. There are systems of measuring targets and performance indicators during the course displaying attendance and punctuality records, painting skills and positive attitudes which students can view and track their own performance. THE IMPACT Of the 205 students that have attended to date, 95 have been deemed employable and of these currently 88 have secured full-time work. K&M Training has resulted in a significant increase in the company s profile. They now work closely with local councils, Trade & Industry bodies and government officials to support and promote training programmes. The company has secured many high profile and prestigious contracts with the likes of TFL London Underground and an Interserve FM programme of works that deals with the employment and training of the local residents as part of the contract.

17 Heart of the City Annual Report 2013/14 Achievements and Performance 15 CASE STUDY: DOVETAIL FURNITURE CONSULTANCY BACKGROUND Dovetail is a contract furniture dealership with a long-established reputation for creating interiors optimised for human interaction, productivity and comfort. The company has always been focused on ecological responsibility and this has brought significant benefits, including important commercial advantages. When, for instance, a client requires sustainability criteria to be met, Dovetail can demonstrate a long track record of excellence and expertise in the field. Helen Bamber Foundation (HBF) is a charity that specializes in providing therapeutic care, medical consultation, legal protection and practical support for the victims of unimaginable violence, through torture, human trafficking, domestic abuse and slavery. THE PROJECT Heart of the City (HOTC) paired 2012 Newcomer Dovetail furniture consultancy, with HOTC Contributors BDG architecture + design to help create a new and inspirational working environment, with the clients needs at its heart. The space comprises traditional work space with comforting consulting rooms, as well as flexible therapy space. Together they turned a dilapidated and depressing wreckage of a building into a welcoming, attractive, safe haven for the victims of some of the world s worst forms of cruelty and abuse. Director of Dovetail, Steve Fitch, realised the priceless assets at the company s disposal: trusting, long-term relationships with a wide range of furniture and interiors suppliers. The support from Dovetail and its suppliers totalled up to 300,000 THE IMPACT In October 2013, the Helen Bamber Foundation officially opened their new Camden offices, fully renovated with the help of Dovetail furniture consultancy. Now the offices host approximately 150 people each week for individual and group therapies, Mind-Body programme, medico-legal assessments, as well as Creative Arts Programmes. Gill Parker, Managing Director at BDG architecture + design, commented: The Helen Bamber Foundation (HBF) is an amazing organisation and it s been a delight to work with such talented and caring people. The space has been transformed from an unloved and dilapidated state into a safe haven for HBF clients and staff. The support from the contract furniture industry has been fantastic and helped us to realise our vision for this unique space. Steve Fitch, Director of Dovetail Furniture was largely responsible for galvanizing the furniture market into action, he said: The response from my peers in the industry has been amazing and truly heartening. Companies of all sizes have donated generously and wholeheartedly.

18 Heart of the City Annual Report 2013/14 Achievements and Performance 16 Our 2012 Newcomer graduates: 40% consider CSR when developing products and services The Bank of England, notably through former Governor Lord George, has a long history of involvement with Heart of the City, and I am delighted to continue that tradition of support by serving as Co-President alongside the Lord Mayor. Lord George rightly believed that firms must recognise their responsibility for the broader system. Such a sense of the systemic is necessary in order to build and maintain social capital and contribute to inclusive capitalism. Heart of the City plays an important role in this regard, helping firms large and small to develop their corporate social responsibility programmes. I encourage all businesses to become part of its network and take full advantage of its broad range of resources and support. 50% developed intiatives to support staff to fundraise during work time 2,732,078 in chartable contributions were made by our graduating Newcomer business, with 44% of these businesses making contributions for the first time Mark Carney, Governor of the Bank of England and Co-President of Heart of the City

19 Heart of the City Annual Report 2013/14 Future Plans 17 FUTURE PLANS Having undergone important strategic changes, building on our brand and increasing our network engagement opportunities in the past year, we look forward to consolidating our successes. Our priorities going forward are to enhance our members journey by: Deliver a high-quality Newcomers programme to businesses looking to start or grow CSR programmes. Amplify the uptake of the Alumni membership programme to maintain the momentum of their CSR programmes. Build on the expertise of our Contributors to share CSR best practices and collaboration with our network. Generate content and resources to magnify our marketing activities and engagement with our wider stakeholder group. Reinforce our operational capacities to pursue future business development and financial stability. Our continued work with fee-paying Alumni members ensures the CSR programmes of our Newcomers continue to grow whilst subsidising the learning of the next generation of Newcomer businesses. Our delivery plans for are framed by six overarching objectives: Our Newcomers programme continues to be efficiently run and well-regarded. Our Alumni membership is successfully carried out at the highest standard and generates revenue to continue the Newcomers programme. Our funders and stakeholders are attracted to the size, composition and quality of our network. Our ability to recruit new businesses of appropriate size and sector to join our Network. Our supporters are sufficiently engaged in our programme and understand its value. Our governance framework is robust and enables us to achieve our mission Year by which we hope our fringes Newcomers programme is self-funded 720 Number of Newcomers we believe will have graduated by our 10 year anniversary (2015)

20 Heart of the City Annual Report 2013/14 Structure, Governance and Management 18 STRUCTURE, GOVERNANCE AND MANAGEMENT Part of our objectives include ensuring our governance framework is robust and enables us to achieve our mission. This section explains how we achieve this. GOVERNING DOCUMENT Heart of the City is a company limited by guarantee, incorporated on 20 October 2006 and registered as a charity on 11 December The company was established under a Memorandum of Association which established the objects and powers of the charitable company and is governed under its Articles of Association. In 2010, we combined both documents and updated them in accordance with the Companies Act In the event of the company being wound up, Members are required to contribute an amount not exceeding 10. RECRUITMENT AND APPOINTMENT OF THE BOARD The Directors of the company ( the Board ) are also charity DirectorsTrustees for the purposes of charity law and under the company s Articles are known as the directors. SELECTION PROCESS FOR BOARD MEMBERS Recruitment of Director-Trustees is carried out primarily as a result of nominations from existing Board members, together with advice from Council members and other organisations with which we are involved. A Nominations Committee reviews applications for membership before making recommendations to the Board. Nominations are made to ensure that any gaps in skills required at Board level are filled. Appointment is undertaken through a vote of the existing directors and a resolution reflecting the vote is signed by the Chairman. The City of London Corporation nominates one Director-Trustee. BOARD INDUCTION AND TRAINING As part of their selection and subsequent induction, our potential/ new Board members are invited to meet our Chief Executive, Chairman and other Directors-Trustees to talk through the role and responsibilities of Directors-Trustees, the work of the Charity and its governance structures. New Board members are given the business plan and other information including stakeholder perception measurement, promotional materials and funder reports. Where Directors have previously been closely involved in helping deliver the Charity s programme, e.g. by mentoring a Newcomer or supporting its

21 Heart of the City Annual Report 2013/14 Structure, Governance and Management 19 marketing work, the induction is modified accordingly. Directors also have access to this and previous Annual Reviews and Reports. Board members are invited to attend the Charity s events and workshops and receive updates on the Charity s work via the Chief Executive s report which is presented as a key agenda item at each Board meeting. MANAGEMENT FRAMEWORK Board and the Council are all Members of the Company. The Council, which comprises the Lord Mayor, the Chair of the City of London Corporation Policy Committee, ex-officials, and senior business leaders, meets once every six months, and its members attend Heart of the City events, participate in community visits etc. The Council members are ambassadors for the project, championing, through their engagement, the growth of effective CSR within their own businesses and, at a senior level, in Newcomer businesses. The Board meets quarterly and is responsible for determining Heart of the City s major strategic, financial and other policies. At present the Board has ten members from a variety of professional backgrounds relevant to the work of the charity. Day-to-day responsibility for the provision of the services rests with the Chief Executive and her team. The Chief Executive is responsible for ensuring that the charity delivers the specified programme and that key performance indicators are met. She also undertakes individual supervision and appraisal of the team, ensuring that they continue to develop their skills and working practices in line with good practice and the Heart of the City Business Plan. CONFLICT OF INTEREST The Directors-Trustees receive no remuneration. No Director-Trustee expenses were claimed during the year. The Board has revised and adopted the Charity s Memorandum and Articles of Association to reflect the provisions of the Companies Act 2006 relating to the Directors- Trustees duties to avoid situations in which they have or can have a direct or indirect interest that conflicts or may possibly conflict with the interests of the Charity. RELATIONSHIP WITH THE CITY OF LONDON CORPORATION The Chief Executive and her team are housed by the City of London Corporation ( CoLC ) and, in addition to core funding, receive considerable practical support from the CoLC in the shape of human resources advice, financial processing and other administration. Heart of the City staff are employed by the CoLC and seconded by the CoLC to the Charity. Health and Safety, Employment Policy and Internal Audit are integral parts of the administration provided by the City of London Corporation. The terms of a Service Level agreement between CoLC and Heart of the City help the directors to satisfy themselves that their own responsibilities in these areas are met. RISK MANAGEMENT The Board reviews the major risks to which the charity is exposed on a quarterly basis. Identified risk falls broadly into five categories: governance, operations, finance, external and regulatory. The Board has established systems or procedures to mitigate these as far as possible. Whilst these procedures can mitigate major risks, the Board is aware that systems can only provide reasonable and not absolute assurance that key risks have been adequately identified and managed. The internal control procedures are designed, inter alia, to highlight the progress being made towards achieving the Company s mission, to maintain expenditure within the limits of available income and to safeguard the Company s assets. An annual budget is set each year in line with the goals and targets of the business plan. Performance against this budget is reviewed monthly by the Chief Executive and quarterly management accounts are produced. In addition regular reforecasting exercises are undertaken to address changes in the economic environment and respond to changes in income expectations. A set of key performances indicators has been established to focus on the major targets of the business plan covering both financial and non-financial measures.

22 Heart of the City Annual Report 2013/14 Financial Review 20 FINANCIAL REVIEW INCOME Our total income was 563,453 as opposed to 594,164 for 2012/13; this included grants from the charitable company s founding and primary funder, the City of London Corporation, funding from the City Bridge Trust, fees for Alumni membership and donations from a number of businesses, together with in-kind support. Expenditure of 527,843 compares with 480,709 for 2012/13. The net surplus for the period was 47,134 compared with 113,455 that was noted in the 2012/13 Annual Report. RESERVES POLICY The charitable company s policy is not to accumulate restricted reserves as its two main funders provide resources for the furtherance of the Charity s activities and not for sums to be held in reserve other than for wind-down and contingency operational purposes. Unrestricted funds may be carried forward to be spent in future years in line with charitable activities. We currently hold 265,233 in free reserves which is above our target level of reserves in order to account for an anticipated funding shortfall in 2015/16. DONATIONS POLICY If there are concerns about the reputation of the donors or the extent of influence over the organisation sought by the donor, the executive will consider the matter with the chair of the board. They will specifically include in their consideration whether there is a threat to the reputation of the Charity, or to its independence. INVESTMENT POLICY Most of the charitable company s funds are to be spent in the short term so there are no funds for long term investment. An investment policy is therefore not considered by the Directors- Trustees to be appropriate for the time being. GOING CONCERN The Directors-Trustees consider the Trust to be a going concern. Please see note 1(b) to the financial statements.