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GENEVA AGAPE FOUNDATION
ANNUAL CONFERENCE, “FAITHINVEST:
IMPACTFUL COOPERATION”.
VENUE: ECUMENICAL CENTRE,
GENEVA, SWITZERLAND
DATE: 16TH – 18TH, JANUARY, 2020
BY: DR. BRIGHT G. MAWUDOR, ACMA, CGMA, CA, MBA, PhD
AACC DEPUTY GENERAL SECRETARY
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TOPIC: FBOs and Investments In
Mission
Case of the All Africa Conference of
Churches (AACC)
PART 1: INTRODUCTION:
Quote: “ Wealth creation is rooted in God the
Creator, who created a world that flourishes with
abundance and diversity. We are created in God’s
image, to co-create with him, to create products and
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services for the common good. Wealth creation is a
holy calling, and a God-given gift, which is
commended in the Bible”. Lausanne Movement
TOPIC: THE SEVEN ANCIENT PILLARS
& PRINCIPLES OF INVESTMENT
• Pillar One: Principles of Semper Fidelis –
Luke 16:10 - “He that is faithful in that
which is least is faithful also in much and he
that is unjust in the least is unjust also in
much”.
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• Pillar Two: Principle of Cold and Hot - Genesis
8:22 - “While the earth remaineth, seedtime and
harvest, and cold and heat,….shall cease”.
• Pillar Three: Diversification - Ecclesiastes 11:2 - “
Divide your portion to seven or even eight for you
do not know what misfortunes may occur on earth”.
• Pillar Four: Principle of Consistency –
Ecclesiastes 11:6 - “In the morning sow your seed
and at evening withhold not our hand; for you do
not know which will prosper, this or that, or
whether both alike will be good”.
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• Pillar Five: Principle of Multiplication – Luke 19:
12 – 26 - “Parable of Talents”.
• Pillar Six: Principle of Watching over your
Investment – Proverbs 27:23 - “Be though diligent
to know the state of thy flocks and look well to they
herds”.
• Pillar Seven: Principle of Tithing – Malachi 3:10
– “Bring the whole tithe into the storehouse, that
there may be food in my house. Test me in this,"
says the LORD Almighty, "and see if I will not
throw open the floodgates of heaven and pour out
so much blessing that there will not be room
enough to store it”.
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PART 2:
• The development history of all Sub-
Saharan Africa has in many ways hinged
on the roles played by Churches and their
related organisations over the last 50 years.
• Churches built hospitals, schools,
agricultural stations as part of their mission
work.
• Research by CORAT – Africa in 2008
shows that most CROs are barely surviving
or in crisis.
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• In 2009 the mega-rich Trinity Church in New York
commissioned six African Anglican Bishops to
explore the possibilities of rendering the Anglican
Communion in Africa financially sustainable.
• In 1996, the AACC in response to its 173 member
Churches held a conference in Nairobi on
“Sustainability of the Church in Africa”.
• For the greater part of its nearly 60 years in
existence, the AACC relied heavily (almost 80%)
on grants from its overseas partners for its
programme delivery with little in-built mechanism
or strategy for financial independence.
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• By 2002, the organization was in financial
crisis for various reasons including: weak
financial management/ strategy, dwindling
donor funding, weak delivery in
programmes, waned loyalty to the AACC as
a brand, lack of innovation, etc.
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PART 3:
AACC TURNAROUND STRATEGY:
By 2003 the leadership of the organization
developed a “Turn-Around Strategy” which
included:
• Re-branding the organization
• Financial Sustainability Strategy (Appendix A)
• Reduce dependence on “partner” funding
and cover core overhead costs
• Ambitious plan to make the organization a
“donor” organization by 2025 (Appendix B)
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AACC RECOVERY ROADMAP:
1. Undertook organizational audit and health
check (governance, mandate, organisational
systems and structures, resources, asset
mapping and valuation, management, market
survey etc.
2. Reviewed systems and developed policies
manuals (viz Financial regulations and
procedures, procurement and HR manuals etc).
3. Developed Business continuity plan.
4. Budget and cash flow forecast.
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5. Developed a Roadmap to Financial
Sustainability.
6. Established “Strategic Business Unit” (SBU)
the Investment / Business wing of the AACC.
Profit from the Unit should be used to support
the mission and programmatic work of the
AACC.
7. Registration of “AACC Investment Trust
Limited” to run the Business wing (SBU) with
its own Board.
8. Launched “Campaign for African Dignity” –
“One dollar per member”.
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8. Guiding principles:
• Regular risk mapping and analysis.
• The “3Es” Concept:
Economy (prudence of minimizing costs at all
opportunities)
Efficiency (resources achieving maximum results
with minimal waste)
Effectiveness (organisation meeting its objective as
completely as possible)
• Ensuring “Value for Money” Concept in all
expenditures.
• Transparency in all transactions.
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PART 4:
YEAR 2013 YEAR 2014 YEAR 2015 YEAR 2016 YEAR 2017 YEAR 2018
YEAR 2019 (8 months
Unaudited)
AMOUNT IN KENYA SHILLINGS
Total Operating Income
431,272,598
328,245,681
315,757,958
315,088,574
326,183,586
340,313,054
252,698,510
Operating Expenditure
(350,655,377)
(266,654,320)
(280,201,478)
(309,983,727)
(314,816,307)
(377,679,956)
(225,473,826)
Net Operating Surplus 80,617,221 61,591,361 35,556,480 5,104,847 11,367,279
(37,366,902) 27,224,684
Extra-ordinary items -
1,177,285,717 -
125,913,591
90,000,000 - -
Total Comprehensive
Income
80,617,221
1,238,877,078
35,556,480
131,018,438
101,367,279
(37,366,902)
27,224,684
Equivalent in US$ 806,172 12,388,771 355,565 1,310,184 1,013,673 (373,669) 272,247
SOURCE OF
INCOME
2013 %age 2014 %age 2015 %age 2016 %age 2017 %age 2018 %age 2019 %age
KES KES KES KES KES KES KES
Grants from
partners 232,690,206 76% 133,114,476 71% 109,407,325 58% 112,890,632 65% 129,175,820 40% 147,284,810 43% 96,981,890 38%
Membership
contribution 2,871,805 2% 2,822,028 2% 2,917,555 1% 2,306,454 1% 2,963,365 1% 4,364,333 1% 1,716,645 1%
Strategic
Business Unit 184,602,889 17% 191,135,132 18% 201,879,667 28% 198,751,091 33% 193,344,881 59% 177,147,548 52% 152,635,467 60%
Other income 11,107,698 2% 1,174,045 9% 1,553,411 13% 1,140,397 1% 699,520 0% 11,516,363 3% 1,364,507 1%
TOTAL
INCOME 431,272,598 100% 328,245,681 100% 315,757,958 100% 315,088,574 100% 326,183,586 100% 340,313,054 100% 252,698,510 100%
TOTAL OPERATING INCOME BY CATEGORY
FINANCIAL RESULTS: CONSOLIDATED STATEMENT OF INCOME AND EXPENDITURE (2013 – 2019)
REAL ESTATE
YEAR INCOME EXPENDITURE OPERATING
SURPLUS
SUPPORT TO
MISSIONS &
PROGRAMMES
NET SURPLUS
KES KES KES KES KES
2013
76,841,784
(25,735,822)
51,105,962 (9,443,586) 41,662,376
2014
72,460,089
(23,702,825)
48,757,264 (18,689,730) 30,067,534
2015
76,732,195
(23,899,515)
52,832,680 (36,283,213) 16,549,467
2016
83,534,609
(32,707,080)
50,827,529 (49,535,787) 1,291,742
2017
89,815,698
(41,588,125)
48,227,573 (38,263,238) 9,964,335
2018
91,790,642
(30,898,862)
60,891,780 (48,713,424) 12,178,356
2019 (8 months
unaudited)
72,142,550
(23,560,605)
48,581,945 (29,190,879) 19,391,066
CUMULATIVE
TOTAL
399,384,375
(147,633,367)
251,751,008 (152,215,554) 99,535,454
Equivalent in
US$
3,993,844
(1,476,334)
2,517,510 (1,522,156)
995,355
STRATEGIC BUSINESS UNIT RESULTS
CONFERENCE CENTRE
YEAR INCOME EXPENDITURE OPERATING
SURPLUS
SUPPORT TO
MISSIONS &
PROGRAMMES
NET SURPLUS
KES KES KES KES KES
2013
107,761,105 (73,152,002) 34,609,103 (2,360,897) 32,248,206
2014
118,675,043 (86,974,109) 31,700,934 (4,672,432) 27,028,502
2015
125,147,472 (97,771,155) 27,376,317 (9,070,803) 18,305,514
2016
115,216,482 (100,760,405) 14,456,077 (12,383,947) 2,072,130
2017
103,529,183 (88,812,711) 14,716,472 (9,565,810) 5,150,662
2018
85,451,244 (89,873,413) (4,422,169) - (4,422,169)
2019 (8 months
unaudited)
80,492,917 (71,100,005) 9,392,912 (2,348,228) 7,044,684
CUMULATIVE
TOTAL
736,273,446 (608,443,800) 127,829,646 (40,402,117) 87,427,529
Equivalent in
US$
7,362,734
(6,084,438)
1,278,296 (404,021)
874,275
STRATEGIC BUSINESS UNIT RESULTS
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PART 5:
CHALLENGES:
• Changing the mind-set of the top leadership /
Governing organs of the organization that
strategic investment in mission is possible.
• How to separate and run the business wing
from the normal programmatic work of the
AACC.
• Management of businesses and operational
risks associated with running the business wing
(SBU)
• Ensuring ethical values in our investments as
well as maintaining high rate of return on
investments.
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PART 6:
LESSONS LEARNT:
• Doing business with a human face is
possible.
• The AACC’s experience demonstrates how
an FBO can do investment with religious
values as well as economic values for a better
world – i.e to help the economy to serve the
common good.
• Between 2013 and 2019 total support from
SBU to programmes was almost $ 2.0m.
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PART 7:
ECONOMIC AND SOCIAL IMPACTS:
• Empowerment of 230 young women and youth
via entrepreneurship training for wealth creation.
• Empowerment of 680 newly elected Bishops /
Church leaders in leadership and diaconal
management, advocacy and resource mobilization.
• Support to 32 Churches across Africa on
widowhood rights/programmes.
• Asset value increased from Ksh 1,186,099,
533(equivalent US$ 13.5 million) to Ksh
2,600,326,442 (equivalent US$ 25.7 million)
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• Revival/Restructuring of Mindolo Ecumenical
Foundation, Zambia.
• Mini-project with minimum of $2,000.00 per project
to support women initiatives across Africa.
• Promotion of African Union Agenda 2063 and SDG
2030.
• Collaborated with Globethics to empower Real
Estate Officers on Asset Management (ACAP).
• African patriotism campaign among the youth,
“Africa My Home, My Future”.
• Migration and Human trafficking programmes.
• $ 30,000 support to South Sudan refugee
programme in Nothern Uganda
• Support for Ebola victims in Sierra Leone and
Liberia during the Ebola crisis.
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Promote women’s rights and elimination of sexual
and gender based violence (SGBV).
Enabled Launch of AACC’s campaign for the
“Plight of Widows” during the International
Widows’ Day on 23rd June, 2019, out of which we
have developed a documentary to facilitate the
campaign through social media.
Development of Women, Peace and Security
(WPS) Framework and an implementation matrix
to enhance women’s engagement in peace
processes.
Development of AACC Gender Strategy.
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Resulted in influencing gender justice at the policy level
through engagement with the AU Women, Gender and
Development Directorate (AUC WGDD); UN Women
(East and Southern Africa Region); UNFPA (United
Nations Population Fund) among others.
Enabled AACC to do High Level Advocacy in Global
forums, showcasing the role of the Church/Religion in
promoting gender justice. Examples are: Participation
at The Commission on Population and Development
(CPD51 and 52) meetings at the UN Head Quarters in
New York; the Nairobi Summit (ICPD+25) held in
Nairobi on 12-14, 2019; International Conference on
Family Planning (ICFP) held in Kigali, Rwanda in
2017, among others.
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PART 8:
FUTURE STRATEGY AND EXPECTATIONS:
• Install solar panels in rental properties to cut on
electricity cost which is about $ 6,000 per month (or $
72,000.00 per annum).
• Look for grant or a soft loan to implement the solar
project.
• Partnership to develop our properties in Nairobi.
• Reduce donor dependency to zero; but partner with
donors on programmes of mutual interest.
• Channel substantial part of surplus funds into poverty
reduction and social impact programmes in Africa.
• Be role model to Churches in Africa about investments
as a driver to missions.
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PART 9:
CONCLUSION:
• Financial sustainability and stewardship of
resources are ever present issues for FBOs
as they seek to balance their mission with
financial responsibility.
• There is a growing tendency for FBOs to do
“investment in mission” where expected
return is commensurate with the market
rate of return.
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• We must work and use our talents to create
Wealth; “if a man will not work, he should
not eat”, St. Paul’s letter the Thessalonians.
AACC PROPERTY DEVELOPMENT STRATEGY 2009 to 2025
FLOW OF FUNDS CHART (Currently Under Review)
Development of Ngong View Apartments
Construction of 2NO. Mugumo
Villas 2009
All Debts Paid AACC as a ‘donor’
Organization
Land Bank and other investments
Dennis Pritt Rd-Serviced Apartments 2009 - 2010
Waiyaki Way - Office Block
Debt Repayment
Support to AACC Administration (from
2011)
Tigoni Rd – Office Block 2009-2010
Tigoni Towers Office Block
Surplus –land plus profit USD 3.45M to be utilized as follows:- a) USD 0.41M for repayment of old
loan for Waiyaki Way Office Block
b) Equity injection of USD 1.28M for
construction of Waiyaki Way
office Block
c) USD 1.75M for repayment of
Dennis Pritt serviced Apartments
Loan
Rental Proceeds USD 0.37M
Construction of 2No. Villas –USD
0.51M
Profit plus Land Equity –USD 1.25M
2008
2009
2011
2012 - 2020
2020
2025
USD 1.75M
Rentals
USD 3.62M
USD 1.41M
APPENDIX B
THANK YOU
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