DRAFT NSUN risk management and exit strategy May 2011

Having established NSUN as a viable organisation and agreed a five year strategy, it is responsible and essential to have a clear exit strategy. It is perfectly reasonable for NSUN to outline alternative funding options if they do not secure grants that ensures minimum disruption and damage to employed staff, volunteers, NSUN members and stakeholders. Making an exit or succession plan is vital when reliant on short term funding This exit strategy is essentially a plan setting out what will happen, once initial funding ends. It illustrates how NSUN intends to maintain funded activities. This may be achieved by locating fresh sources of funding, diversifying or contracting within the public sector or becoming self-sustaining, securing income through chargeable services, scaling back a project or closing it altogether. Work that has been undertaken to militate against the risk of closing NSUN altogether: 1. Business planning support from Pilotlight 2. Five year strategy produced and business planning support from Pilotlight received 3. NSUNs funding strategy identifying multiple funding streams that overlap in timescale 4. Continued sourcing of financial support, through grants, loans, donations and/or subscriptions 5. Exploration of developing chargeable products and services through the National Involvement Partnership 6. Ensuring that all specified requirements of funders have been met 7. Exploring the potential for work to progress beyond the point at which funding runs out 8. Consideration of close down and the legal and ethical responsibilities and association actions The London Development Agency Readiness Assessment Tool recommends four possible routes to successful succession or managing closure effectively. Step 1 self-assessment Step 2 succession routes 1. Mainstreaming 2. Further funding 3. Enterprise 4. Closure NSUN conducted a members survey July 2010 and Comic Relief commissioned an independent evaluation of NSUN September 2010. Both covered a range of stakeholder opinions on past experience and future potential of NSUN. Evidence of NSUN activity and impact of work is collected on a quarterly basis. Closure of NSUN If core funding is not secured then the worst case scenario NSUN may face is to close temporarily or permanently. The exit strategy will be implemented following: 1. Investigation of every other option thoroughly. This would include, being absolutely sure that a regular funder wont help, that a contract cant be renegotiated, that a bridging loan cant be sought or that making some redundancies would not enable work to continue. 2. Accurate cash flow and forecasting, to work out what is left and what will need to be spent month by month until funds run out. 3. Identifying the spent-up point to calculate when the windup process needs to start, issue redundancy notices etc. 4. Planning what surplus to leave in case of unexpected liabilities. If funds are left at the end it will go to another charity, 5. Ensuring the possibility of exposing Trustees to liability is avoided. 6. Calculating the actual level of what the liability might be and plan for the worst possible scenario.

DRAFT Timetable NSUN will plan out what needs to happen, and in what order. For example, transferring any remaining assets to the beneficiary decided by trustees before the wind-up papers are sent in to Companies House. Planning sessions will be held to talk through the implications and plan actions. Who will see the process through? The Chair and Manager will have the responsibility of managing the process. As any staff member under notice of redundancy may leave at any time, responsibilities for action in the wind-up plans need to be assigned to named staff with consideration to backup. This will include preparation of the trustees/board regarding the skills and information to complete the wind-up? Assets and debts Assets will be sold to raise as much money as you possibly. Debts will be paid with consideration given to every eventuality. NSUN has limited liability so trustees will not be personally liable unless closure is proven to be down to irresponsible or irregular governance practice. The key to doing this properly is to be clear about the balance between NSUNs assets and liabilities. NSUN Trustees and Manager monitor this through the regular financial management oversight. In the event that NSUNs assets do not meet the liabilities NSUN is legally obliged to take immediate action. Protection and support of NSUN people The process of closing down will cause worry and distress to the board, staff and volunteers, and members and partners. As soon as closure is confirmed as the only option contact with other suitable organisations, will be made, to start the process of negotiating the transfer of key projects. Funders will be contacted in plenty of time to let them know what is planned and see if transfer of grants (if relevant) would be acceptable to them. If no area of NSUN work can be saved effort will be made to signpost people to other services and sources of support. NSUN will endeavour to keep everyone informed and help them to understand how this situation has come about and be clear that there was no other option. NSUN will ensure there is a graceful exit programme for all staff with a 3 month wind-down period and thoroughly explore suitable support packages e.g. Penna provide 1000 training/coaching advice on CVs, or offering individuals gardening leave. Employment opportunities within the sector will be explored. The planning will pay particular attention to minimising disruption and distress. Legacy planning NSUN will consider whether there are different scales of operation that could be undertaken with a reduction in funding e.g. what posts are mission critical and what would be necessary to keep in order for the bare minimum for the organisation to function. Areas of work or some projects could become independent and have a new start on their own. NSUN will have a legacy to leave in terms of ideas, information and experience; this will be passed on as well as surplus cash. NSUN will make a note of the top 3 people/organisations (who align most with member values) that the website could be hosted with. There will be planned time in the wind down process to actively engage with these individuals to manage this process (with a minimum 2 week hand over to whoever agrees to take over the management of the site). In all of this risk management, process targets will be reviewed every couple of months so the NSUN team has a good handle on the organisations position. If well managed there should be a positive legacy and on-going momentum built on the five years of funded work.