Rainforest Alliance

CharityWatch's rating of Rainforest Alliance (RA) includes the financial activities of the RA "branches and affiliates in various countries" included in the RA audited consolidated financial statements for the year ended December 31, 2022.

According to the Rainforest Alliance (RA) 2022 consolidated audit (Note 1, Organization and Nature of Activities):

"Rainforest Alliance...is an international non-profit organization, which was organized in 1987 in the State of New York with branches and affiliates in various countries. ... All the activities of its branches and affiliates are included in these [audited] consolidated financial statements. RA conducts the majority of its activities throughout North America, Central America, South America, Africa, Europe and Southeast Asia."

[All significant intercompany accounts and transactions have been eliminated in the audit consolidation.]

According to the Rainforest Alliance (RA) consolidated audit of December 31, 2022 (Note 9, In-Kind Contributions), RA received in-kind contributions during 2022 on which it placed a total value of $1,474,607. Of the total value, $1,181,607 consisted of in-kind legal services.

[Note: CharityWatch generally excludes the value of in-kind (non-cash) donations of goods and services from its calculations of Program % and Cost to Raise $100. More information on how grades are calculated and the treatment of in-kind donations can be found on the Our Process page.]

According to the Rainforest Alliance (RA) consolidated audit of December 31, 2022 (Note 17, Sale of RA-Cert and Discontinued Operations):

"During 2018, RA sold its assets in connection with its RA-Cert line of business. This sale represented a strategic shift in RA's operations and as such was recorded as a discontinued operation in the consolidated statement of activities and changes in net assets. As part of the sale, RA was entitled to a percentage of annual revenue. Effective December 31, 2021, the sale agreement was amended to terminate the agreement and all remaining liabilities were settled and a final payment of $750,000 was made to RA in 2022. RA recognized a gain from discontinued operations of approximately $1,259,000 for the year ended December 31, 2021."

According to the Rainforest Alliance (RA) consolidated audit of December 31, 2022 (Note 18, Related Party Transactions):

"During the year ended December 31, 2022, RA contributed approximately $12,864,000 to Stichting Rainforest Alliance, its affiliate through common ownership. RA made no contributions to Stichting Rainforest Alliance during the year ended December 31, 2021. 

"RA and Stichting Rainforest Alliance share employees and other costs. These costs are evaluated at least annually, and the amounts are due to or from the entities to cover for the costs being incurred. RA had a receivable due from Stichting Rainforest Alliance in the amount of $2,301,251 and $2,187,162 at December 31, 2022 and 2021, respectively."

According to the Rainforest Alliance (RA) consolidated audit of December 31, 2022 (Note 14, Commitments and Contingencies - Government Grants and Contracts):

"RA receives funding from various federal and foreign agencies under grants and contracts, many of which have commitments spanning multiple years. RA has available funding under federal agency contracts through March 2027 of approximately $29,531,000. RA's costs incurred under its government grants and contracts are subject to audit by government agencies. Management believes that disallowance of costs, if any, would not be material to the consolidated financial position or changes in net assets of RA."

According to the Rainforest Alliance (RA) consolidated audit of December 31, 2022 (Note 12, Paycheck Protection Program Loan Payable):

"On May 1, 2020, RA issued an unsecured promissory note (the "PPP Loan") for $1,782,710 through programs established under the Coronavirus Aid, Relief, and Economic Security Act and administered by the U.S. Small Business Administration (the "SBA"). The PPP Loan was guaranteed by the SBA. The PPP Loan may be forgiven, in whole or in part, if RA was eligible for the PPP Loan at the time of application, used the loan proceeds for eligible expenses within the defined 24 week period, and otherwise satisfied PPP requirements. The loan was for a two-year term bearing interest at 1.00% per annum. On August 27, 2021, RA was informed that its application for forgiveness of $1,782,710 of the PPP Loan was approved. Accordingly, RA recorded it as forgiveness of debt in the accompanying consolidated statement of activities and changes in net assets for the year ended December 31, 2021."

According to the Rainforest Alliance (RA) consolidated audit of December 31, 2022 (Note 10, Retirement Plans and Foreign Severance Payable):

"RA has a qualified tax-deferred annuity plan under Section 403(b) of the Internal Revenue Code for eligible employees in the United States. RA offers all eligible employees working more than 20 hours per week a matching contributory retirement plan. Employees can begin making contributions immediately upon hire and are eligible for a discretionary employer-matching contribution of up to 5% of salary after on year of employment. RA made matching contributions totaling approximately $514,000 and $539,000 for the years ended December 31, 2022 and 2021, respectively."

"RA has recorded an obligation for foreign severance payable in accordance with the laws in the locations for employees working in certain foreign jurisdictions of approximately $2,646,000 and $2,651,000 at December 31, 2022 and 2021, respectively, which is included in foreign severance payable in the consolidated statement of financial position. the foreign severance reserve is an estimate that is based on the laws of each foreign jurisdiction but generally is computed based on the years of employment for each employee, as well as other factors, and varies based on the individual laws within the foreign country. The obligation is required to be funded when an employee's employment with RA terminates."