3.5.3.3 The participatory governance of Stratford PLCIC

According to Stratford PLCIC, the community may acquire ownership both formally and indirectly if represented by a community benefit society (hereafter ‘BenCom’), or formally and directly by purchasing Stratford’s PLCIC shares. As such, either the community or the community’s representatives could be in a position to participate formally and directly in the decision-making processes of the CIC. Participation can also take place indirectly represented by a BenCom with a competence to decide the way in which energy production and the income generated by the energy trade should be managed and distributed for the benefit of the community. However, the transfer of the company’s shares to the community was not realised as of April 2017. Hence, the CIC’s revenue (£185,135) and profit (£18,972) recorded in its first operating year (2015 – 2016) could not be directed back to the community in the form of paid or proposed dividends (Stratford PLCIC Annual Accounts 2016: 6). Moreover, the community was not eligible to participate in either a formal and/or a direct way in the decision- making activities of Stratford PLCIC concerning the way in which the CIC’s revenue could be distributed back to the community.

Nonetheless, a voluntary supporting scheme for local and community charity groups was initiated by Anesco and Stratford PLCIC, according to which, part of the revenues from the sale of the energy produced by the CIC was provided directly, in the form of donations, to selected local community projects and charities, namely the Stratford Hospital Appeal and the Welford-on-Avon Primary School (Anesco public announcement 2016).1

Furthermore, the participation of the community in membership and decision- making may contribute to the development of various schemes of community investing. Stratford’s PLCIC annual accounts revealed that the CIC was already partly financed by community investors in the development phase of the Drayton Manor Farm Project. Stratford PLCIC auctioned £3.4 million CIC solar bonds to the local community (Stratford PLCIC Annual Accounts 2016: 16). Accordingly, the community was invited to purchase the CIC’s solar bonds in order to finance the development of the solar panel arrays. The solar bonds, according to Stratford PLCIC, could yield a 5% annual gross return to community investors, with a specified interest paid every 6 months for 3 years (Anesco public announcement 2016).2 The interest paid to community investors was subject to the Regulator’s imposed interest cap. The raise of capital through solar bonds was reflected in the company’s annual accounts and report of 2016. Crowdfund Insider also reported that the bonds were offered and purchased by community investors through a crowdfunding platform named Trillion Fund using the crowdfunding service ‘Your Brand Crowdfunding’. The crowdfunding platform enabled Stratford PLCIC to crowdfund on its own website (Crowdfund Insider 2016).3

The transfer of Stratford’s PLCIC ownership to the community could also allow for the participation of the community into the membership of the organisation and accordingly in the decision-making processes of the CIC in a formal and direct way. Following Article 22(3) of Stratford’s PLCIC AoA, each member of the company could become a director. At Stratford PLCIC, the directors could be appointed either by members and/or by a board’s decision. The directors could decide collectively by a majority of votes either when board meetings were held, or unanimously in the event that the board decides without a directors’ meeting (Arts. 12, 16, 18 and 22, AoA). Accordingly, the community could have the competence to contribute to the decision-making processes. This could be done through the exercise of voting following various governance models: (i) a democratic model in which decisions could be made through equal voting by either the representatives of community constituents and/or community members; (ii) a stakeholder model in which stakeholder representatives could be elected or appointed by stakeholder groups that could participate in decision-making with one or more (equal) votes; and (iii) a stewardship model, in which appointed experts (directors) could make decisions to improve the CIC’s performance by serving the community benefit objectives and interests.

However, there were no provisions found in Stratford’s PLCIC AoA that permit the participation of community stakeholders or third-parties other than directors and members in the decision-making processes of the CIC’s governing bodies. Reference to third-party participation in decision-making was only made in Article 11 of the company’s AoA, which allowed for the delegation of director’s powers and/or their day-to-day implementation to third parties, i.e. individuals or committees. The delegation could be exercised to such an extent that directors think as ‘fit’ in their powers and in accordance with the CIC’s objectives for the benefit of the community. However, as of April 2017 the community did not yet own Stratford PLCIC as it was still owned by Anesco.

As such, its board of directors comprised only three directors who represented the sole shareholder, i.e. Anesco. The annual accounts of 2016 of Stratford PLCIC mention that the company has no employees other than the active directors (Stratford PLCIC Annual Accounts 2016). Those directors did not receive any remuneration for the provision of their services (Stratford PLCIC Annual Accounts 2016). However, Stratford PLCIC is a young organisation that has not yet fulfilled its aspiration of becoming a community owned company.

In its CIC report of 2016, Stratford PLCIC remarked its intention to work closer in consultation with its community stakeholders. In fact, at the time of research the CIC was already accountable to its community stakeholders. It maintained an ‘open dialogue’ between its community stakeholders and the company ‘at all times’ with the objective to minimise the impact of the solar farm’s activities on the surrounding community stakeholders and the natural environment (Stratford PLCIC CIC Report 2016). For instance, community stakeholders had – on an ad hoc basis – an active and direct consulting role in the development of the solar farm through consultation processes that were formally required by the regional regulatory framework. Consequently, Anesco and thereby Stratford PLCIC were obliged to acquire permission from the local council to develop land in the area of Stratford-upon-Avon. They were also obliged to acknowledge the impact of the solar panel farm and its operation on the natural environment, which could be disturbed by the establishment of the solar panels (Stratford PLCIC CIC Report 2016; Environmental Report 2015).

The development of the farm was realised by Anesco in partnership with RSPB, a charity that was established to deal with nature protection consulting and conservation to ensure sustainability. RSPB and Anesco developed a joint project in which the sites of solar farms could be used to replicate and improve the natural habitat of threatened local wildlife (Anesco public announcement concerning RSPB 2016).4 Anesco – in consultation with RSPB, suggested the protection of the local wildlife in the Drayton Manor Farm by providing a safer environment to the local and native animal species to live (Environmental Report 2015: 37-41).

Anesco and Stratford PLCIC were obliged to acquire permission from the local council to develop land in the area of Stratford-upon-Avon, also in relation to the impact this development could cause to the local populations in the vicinity and surroundings of the site. Consequently, Stratford PLCIC and Anesco took into consideration the impact of the solar panel farm to the surrounding community stakeholders (Stratford PLCIC Report 2016; Environmental Report 2015). Such an impact comprised the visual, physical and noise impact of the solar farm to the landscape, and the impact to community life. Subsequently, the farm was developed following a formal, ad hoc and direct consultation process by the local council, which involved various third- parties and the community, e.g. local and administrative councils, such as the Stratford and Drayton Parish Council and the UK Department for Communities and Local Government; environmental, urban development, archaeology and other expert groups; and various NGOs and expert individuals, such as the Stratford Friends of the Earth and Ramblers Association, amongst others (Council Report 2015).

In these consultation processes, certain concerns were raised from the community and the involved stakeholders (Council Report 2015). In response to the claims, a variety of measures were developed by Anesco and Stratford PLCIC to assess and mitigate the impact of the solar farm on rural and local views, and on the dominating visual effect of the development on the landscape (Environmental Report 2015: 28-34).

Stratford PLCIC, in its CIC Report of 2016, also remarked its intention to maintain its communication with its community stakeholders. Certain types of community stakeholders received regular but informal information regarding the development of the Drayton Manor Farm project. The stakeholders included the landowners of the Drayton Manor Farm. As such, Stratford PLCIC was in direct communication with the landowners of the Drayton Manor Farm Project.

Stratford PLCIC, in its CIC report confirmed that the landowners of the Drayton Manor Farm were regularly updated regarding the progress of the development. Regular communication was justified on the fact that other than the development of the solar panel farm – which could be a source of income for the landowners of the Drayton Manor Farm – a second type of renewable energy activity was undertaken by the landowners in the premise of the farm (Stratford PLCIC CIC Report 2016; Council Report 2016). The second activity delivered a portion of renewable energy from short rotation willow coppice harvested for biofuels. Accordingly, a small part of the willow coppice was maintained in the farm by the landowners and processed by them into biofuels, whereas the biggest part was diversified to accommodate the solar panels.

Regular communication also took place with the community investors who partly funded the farm’s development. As such, Stratford PLCIC reported that continuous and direct communication was undertaken with the community investors who were regularly informed regarding the developments of the installation and operation of the solar panel arrays (Stratford PLCIC CIC Report 2016). The communication also comprised information regarding the farm’s initial performance and expected returns since March 2016, which is the date the farm initiated its full operation (Stratford PLCIC CIC Report 2016).