Annual Report 2020 the Church Commissioners the Church Annual 2020 Report the Church Commissioners Annual Report 2020
Total Page:16
File Type:pdf, Size:1020Kb
Supporting the work and mission of the The Church Commissioners for England Church of England Annual Report 2020 The Church Commissioners Annual Report 2020 Annual The Church Commissioners The Church Commissioners Annual Report 2020 Supporting the work and mission of the Church of England Presented to Parliament pursuant to section 12(2) of the Church Commissioners Measure 1947 Copyright © 2021 THE CHURCH COMMISSIONERS FOR ENGLAND Any enquiries about this report should be send to the Church Commissioners’ Secretariat at their registered office: Church House Great Smith Street London SW1P 3AZ [email protected] Registered Charity Number 1140097 This document is available for download at: cofe.io/CCAnnualReport2020 Overview Foreword by the Archbishop of Canterbury and the First Church Estates Commissioner 02 The Church Commissioners at a glance 03 Aims and objectives 04 Looking forward – letter from the Chief Executive 08 Supporting the Church of England Supporting dioceses and the local church 09 Bishops’, Archbishops’ and Cathedrals’ ministry 14 Parish reorganisation and Church property 16 Investing for the Future Investment policy and investment objectives 18 Social, environmental and ethical considerations in our Responsible Investment policy 22 List of larger holdings, property and equity 24 Financial Review A review of our 2020 financial activity 26 Long-term financial strategy 27 Going concern and carbon reporting 28 Risk Management Statement 30 Governance How the charity is constituted 36 Organisational structure and staffing 38 Board of Governors and Trustees 40 Trustees’ Responsibility Statement 44 Distribution Information Money available resolution and summary report from the independent actuaries 45 Financial Statements Independent Auditor’s Report 47 Consolidated statement of financial activities 49 Commissioners’ statement of financial activities 50 Balance sheets 51 Consolidated cash flow statement 52 Notes to the financial statements 53 Cover image: Portsmouth Cathedral. Church Commissioners Annual Report 2020 01 Foreword by the Archbishop of Canterbury and the First Church Estates Commissioner It is with real gratitude that we are able operational and governance frameworks In 2020 we moved towards our goal of a net to report on the work of the Church and bring cathedrals within the ambit of zero carbon portfolio by 2050 by engaging Commissioners at the end of 2020, Charity Commission legislation, ensuring with companies and policy makers and a year which challenged us all. The alignment with best practice elsewhere in through joining the Net-Zero Asset Owner Commissioners continued to show the third sector. Alliance. The Church Commissioners also leadership and support for dioceses, began to develop a framework with cathedrals and churches whilst upholding Providing support for the Church is only independent specialists, which we will use the good stewardship of the historic assets possible because of the positive financial to assess the ESG aspects of our real estate entrusted to them. returns we have achieved. The holdings. This ESG framework will underpin Commissioners’ investments beat their management of our development land and The Commissioners stepped in with 2020 target despite the volatility and ensure it is used in the most sustainable financial support as people looked to the uncertainty in the markets. Our longer-term way possible. Church during this time of tremendous results also remained strong, with spiritual and practical need. At the same performance over five, ten and 30 years all We extend our thanks to Bishop David time, the Church itself was challenged by ahead of our target returns. We extend our Walker for his excellent chairing of the the impact of the COVID-19 pandemic, not thanks to those in the Investment division Commissioners on Justin’s behalf, to least by its acute consequences on finances for their excellent management of the fund. Andrew Brown for his long and dedicated at the local, diocesan and national level. service as CEO until his retirement in January As signatories to the United Nations-backed and to Gareth Mostyn for a tremendous first In March, the Church Commissioners, in Principles for Responsible Investment, year as Andrew’s successor. partnership with the Archbishops’ Council, we are committed to integrating ESG announced liquidity measures to assist (environmental, social and governance) Our colleagues showed exceptional dioceses and cathedrals whose finances considerations into the stewardship of assets commitment in 2020, especially given the were adversely affected by the pandemic. across our portfolio. Being Responsible extraordinary circumstances and added The first package totalled £75m of liquidity Investors is essential to managing the pressures of working from home, caring support, and the second was a £35m Church’s assets and our efforts achieved duties and social isolation. We remain diocesan sustainability fund. Together with external recognition in 2020 with several grateful to them and appreciate the resilience the Cathedral Sustainability Fund, which industry awards. Our approach to they have demonstrated. was replenished during 2020 with an Responsible Investment (‘RI’) includes and additional £10m on top of the originally goes beyond ethical exclusions to It is our prayer for the future, as we emerge budgeted allocation, these were prioritised encompass stewardship of climate change from the COVID-19 pandemic, that we share to give short-term assistance to dioceses impacts, proactive company engagement the good news of Jesus Christ through the and cathedrals in 2020 and 2021. on other issues of concern, impact investing work of the Church with the support of the and collaboration with other asset owners. Church Commissioners. Aside from this emergency backing, supporting the work and mission of We and our National Investing Bodies Justin Welby England’s cathedrals has always been a colleagues restricted investment in nine Archbishop of Canterbury priority for the Church Commissioners. companies that fail to meet our climate Our thanks go especially to Eve Poole, the standards, while 12 companies made Loretta Minghella Third Church Estates Commissioner, who changes to stay off the restricted list. This First Church Estates Commissioner played a pivotal role in preparing the way for was the first time investment was restricted the safe passage and implementation of the in companies that fall short of specific Cathedrals Measure, which gained final carbon emissions standards, and approval from General Synod and is on demonstrated our commitment to delivering track for Royal Assent in 2021. The on our 2018 agreement with Synod. Cathedrals Measure is set to strengthen 02 Church Commissioners Annual Report 2020 The Church Commissioners at a glance 2020 2019 Overview £162 .5m £117. 5 m Total charitable expenditure Total charitable expenditure excluding clergy pensions obligation* excluding clergy pensions obligation* 10.4% 10.0% Total return 2020 Total return 2019 9.5% 8.5% Supporting the Church of England Total return (30 years) Total return (30 years) £99.1m £59.4m Supporting dioceses Supporting dioceses and the local church and the local church Investing for the Future Financial Review Financial £42.5m Governance Bishops’ and Archbishops’ ministry £37.9m Bishops’ and Archbishops’ ministry £20.0m Information Distribution Cathedrals’ ministry £10.5m Cathedrals’ ministry £5.5m £5.1m Other activities Other activities £118 . 9 m £120.1m Statements Financial * Total cash paid on * Total cash paid on clergy pensions in 2020 clergy pensions in 2019 Investment fund: £9.2bn Investment fund: £8.7bn Church Commissioners Annual Report 2020 03 Aims and objectives Our strategic priorities The Church Commissioners’ strategic focus is to support the Church of England’s ministry, particularly in areas of need and opportunity. Aims Strategic objectives 2020 achievements 2021 priorities 1. Supporting Church’s Help to ensure the Commissioners’ funding — New governance arrangements established — Work in partnership with the Archbishops’ is intentionally used for mission and growth for fund distribution, including new grant Council to ensure diocesan funding streams ministry through funding streams. continue to be deployed in line with agreed effective use of — Contributed substantial emergency COVID-19 criteria and in accordance with need, Commissioner liquidity and funding support to Church. reflecting ongoing impact of COVID-19. funding — Helped Archbishops’ Council establish — Manage replenished Cathedral Sustainability new social impact investment portfolio. Fund to address strategic priorities and — Completed Lambeth Palace Library COVID-19-related support. construction within budget. — Complete the move into and open the new Lambeth Palace Library, realising the vision to collect, preserve and make accessible the collections so they can be explored and enjoyed by all. 2. Supporting Support different parts of the Church to — Cathedrals Measure received final approval — Implement new Cathedrals Measure and Church’s ministry enhance their use of resources to advance at General Synod. establish co-regulation function with the mission and growth — Maintained effective operation of adjudicatory Charity Commission. through practical functions, providing additional support to — Ensure continued fairness in adjudicatory guidance and diocesan teams during lockdown period. functions under the Mission and Pastoral effective processes — Issued guidance