Financial summary 2021

Throughout 2020/21 and into 2021/22, IIED has been closely monitoring the delivery of its projects, including the ability of partners to carry out research.

Although COVID-19 did impact the delivery of some projects, these delays have not been significant. The primary COVID-19 related impact was the loss of UK Research and Innovation funding to two major programmes, but one was approaching closure and adapted its final-year programme, and the other has already had some success in generating alternative income to continue the majority of its work.

Income was very slightly lower than the previous year, GBP£18.2 million against £18.4 million recorded in 2019/20, while the average number of employees increased to 140 (2019:133), with further expansion in the institute's research activity (core staffing remained static).

Payments to collaborating entities increased from £3.6 million in 2019/20 to £4.6 million in 2020/21.

Supporting employees

At the beginning of the year, IIED established a coronavirus response team to monitor and respond to internal and external risks and issues. Other than a brief return to the office in autumn 2020, staff spent the majority of the year working at home, but with a programme to move all data and core systems to the cloud, the impact was minimal. Instead, IIED focused on supporting employees: working groups for health and safety and wellbeing were set up, and a furlough policy agreed with the union.

The identified strategic risks of being unable to travel internationally to support research and policy engagement activities, and a reduction in aid budgets both materialised. Despite this, the institute maintained financial and operational stability.

Prior to the pandemic, the institute had planned to extend its London office lease for a further five years. Instead, IIED left in December after 10 years, moving to serviced offices with a contract through to mid-2023. During 2022 the institute will review its overall office requirements.

IIED has no fundraising activity and is not a grant making organisation; instead it works in collaboration with its partners, resulting in no fundraising activity and grant making disclosures being given.

Reserves policy

IIED’s reserves policy is aligned with its five-year strategy launched in April 2019. To protect the organisation and its charitable programme against the risks of funding loss through income shortfalls and other unexpected financial losses, the policy sets a target for total unrestricted reserves of approximately four months of operating costs and staff salaries less liabilities from employee benefits.

This is around £2.2 million: trustees have therefore set the target range of free reserves (being total funds less restricted and designated funds) at between £1.9 million and £2.5 million.

The total funds at 2020/21 year end were £2.5m (2020: £2.6m). The total free reserves have decreased to £2.2m (2020: £2.4m), within the target range endorsed by the board.

Investment policy

IIED invested its cash in fixed-term deposits during 2020/21. This policy produces an acceptable rate of return while giving the institute flexibility to access funds.

Related parties

Some IIED trustees are also trustees of other charities or directors or senior officers in other organisations IIED works with as a normal part of its research activities. Where such work involves payment, they enter into arm’s length contracts and any payments related to these contracts are detailed in the notes to these accounts. The board operates a conflict of interest policy.

Looking ahead

Key cross-cutting institutional initiatives for 2021/22 include:

• The COP26 climate and COP15 biodiversity conferences, which will be focal points for our policy influencing
• Support for the newly-established IIED-Europe office in Amsterdam, building new partnerships and working on new projects
• Internal discussion about culture and strategy, with the findings of the race and racism working group feeding into the vision for a future IIED, and 
• As the institute settles into serviced offices, IIED will be able to more clearly identify any London office requirements beyond 2023 to support our strategy and reduce our carbon footprint.

The trustees' report and accounts for the year ended 31 March 2021 contains detailed financial information, including a breakdown of all income received by IIED above £10,000.

Value for money statement

Demonstrating value for money is ever more important for organisations using public funds. With aid budgets under pressure, development organisations need to show that they are efficient, that poor people's lives are actually improving, and that the environment is protected. Read our value for money statement on our Publications Library.

Previous reports

See the financial summaries from previous years: 2020; 2019; 2018; 2017; 2016; 2015; 2014; 2013

2020/21 financial summary