The Lbg Annual Review 2014

MAXIMUM IMPACT: THE LBG ANNUAL REVIEW 2014 1 What is LBG?

LBG is the global standard for measuring Corporate Community Investment (CCI). The LBG framework ensures a consistent approach to the measurement and benchmarking of CCI. The network of companies using LBG provides a platform to share experience, best practice and new ideas.

The LBG framework

Inputs: What’s contributed Outputs: What happens Impacts: What changes

The resources a company provides The activities delivered, numbers reached, The changes that happen to individuals, to support a community activity. funds raised and business-related activity organisations and the company, in resulting from the contributions made. the short or longer-term, as a result of the activity.

How: Community outputs: Community impacts: Cash, time, in-kind, management cost Numbers helped, activities held etc. Change in beneficiaries, organisations and/or society Why: Leverage: Charitable gift, community investment, Additional funds raised Business impacts: commercial initiative in the community Change in business performance Business outputs: What: Media coverage, awareness Issue addressed (education, health etc.) among customers, employees etc.

Where: Location of activity

Delivering impact

The following examples show how companies use the LBG framework to deliver maximum impact.

Linklaters — Learn for Work is the law firm’s global programme, raising the aspirations of young people in communities around its offices. Data on the UK programme shows:

What’s contributed ? What changes? What happens? £300,000 cash annually 6,380 young people across Of the young people benefiting: and £75,000 of time from 20 schools have benefited 80% reported a positive change in behaviour or attitude more than 100 employees from activities including 65% reported improved skills and personal effectiveness literacy festivals, debate 78% of teachers reported a positive influence on teaching practice training and mentoring Of the volunteers: 287 teachers received 100% developed their communication skills training and support 90% increased their pride in the firm 80% increased their commitment to Linklaters

Dentsu Aegis Network – GlobalGivingTIME is the communications firm’s global volunteering project running across 61 countries.

What’s contributed ? What changes? What happens? £87,000 in cash support 217 charity organisations Of the supported charities: and running costs received volunteer support 26% improved their communication capacity to help address a range of 24% increased their profile 573 employee volunteers issues including education, 15% were able to spend more time with beneficiaries contributed £15,000 social welfare and the of time Of the employees involved: environment 56% improved their job-related skills 83% increased their personal impact 89% made a positive change in behaviour or attitude

2 MAXIMUM IMPACT: THE LBG ANNUAL REVIEW 2014 Welcome

Twenty years ago, six pioneer Investment**, LBG has done more each member in control of their companies identified the need for than ever to demonstrate itself as data throughout its lifecycle a consistent and robust framework the global leading standard, helping from individual project to enable companies to measure companies to measure and report contribution and impact and benchmark their community their community contributions data to company-wide results. contributions. Over 200 companies and the impact they are making The LBG framework are now part of LBG’s worldwide in a concise and transparent way • Provide cross-company network. We should all be proud, as supported by robust principles. benchmarking analysis at members of LBG, of the collective the tips of member’s fingers. Inputs: What’s contributed Outputs: What happens Impacts: What changes contribution we have made in As a member-led network, LBG developing this framework to be the is founded on, and develops So our 20th year has probably been The resources a company provides The activities delivered, numbers reached, The changes that happen to individuals, leading global standard it is today. through, the practical experience our busiest yet and 2015 promises to support a community activity. funds raised and business-related activity organisations and the company, in of community investment to be our most exciting. As these resulting from the contributions made. the short or longer-term, as a result At a time when it has been reported professionals around the world. developments are rolled out, of the activity. that corporate giving is declining* LBG will be better placed than ever it’s great to see that LBG member This year we have used this to meet the needs of current and How: Community outputs: Community impacts: companies are sustaining their experience to: future company members, wherever Cash, time, in-kind, management cost Numbers helped, activities held etc. Change in beneficiaries, levels of giving and indeed they are in the world, that want to organisations and/or society reporting a 4% increase in the • Refresh the LBG impact make the maximum impact through Why: Leverage: number of employees engaged framework to enable a deeper the contributions they make. Charitable gift, community investment, Additional funds raised Business impacts: in volunteering in business time. assessment and understanding commercial initiative in the community Change in business performance Business outputs: It’s also encouraging to see that of the degree of change What: Media coverage, awareness the continuing trend towards programmes are achieving. Pam Webb Issue addressed (education, health etc.) among customers, employees etc. more strategic long term Chair of the LBG Steering Group community investment is also Produce integrated guidance Where: Location of activity • 4% up on last year. to better support the practical application of the LBG model. Also, when there have been calls * Directory of Social Change, for more consistency in the way • Develop a leading edge, on-line Company Giving Almanac 2013 that companies measure and data collection, analysis and ** Corporate Giving by the FTSE100, report their Corporate Community benchmarking tool that puts Charities Aid Foundation, 2014

How companies use LBG

Rolls-Royce annual report, our sustainability First Group progress through benchmarking; report, Better Future, and our comparing companies against each “We are serious about delivering completion of indices such as DJSI. “Through our targeted support for other and using this knowledge to shared value to both the We also use the data collected long term charitable partnerships, share expertise and best practice. communities in which we operate to report back into the business and by mobilising our 117,000 and our business (including our about activity in a particular employees, we’re using our global Ultimately, LBG provides a customers & supply chain). LBG business unit or geography. scale and expertise to deliver consistent framework for asks the questions and provides shared value for our business collection and measurement that the answers to help us determine As we continue our journey in and for our local communities. allows us to direct our support if we do deliver. measuring the impact on the to the most impactful areas.” communities we reach, and on Our charitable programmes LBG provides a framework against our existing and future employees, focus on those areas where which we can critically assess LBG will help us to review the we believe we can deploy our Katie Smart, what we are doing around the questions we are asking and scale and expertise to achieve CR and Community Manager world, its impact and strategic validate the data our process the greatest impact. LBG helps relevance to our business and how produces. It also enables us to us to understand the business it compares to others within our share best practice with, and and community benefits of our sector and outside. It ensures that learn from, other companies partnerships which in turn informs we are able to state, with some who have tackled, or are tackling, our strategy for the future. confidence, how we are performing these challenges.” against key targets, such as Our programmes all link back to reaching 6 million people through our vision – to provide solutions STEM education initiatives. Paul Broadhead, for an increasingly congested Head of Community Investment world, keeping people moving The data collected through and Education Outreach and communities prospering, so application of LBG supports our we also use LBG to assess our

MAXIMUM IMPACT: THE LBG ANNUAL REVIEW 2014 3 LBG’s vital statistics 2014: Contributions LBG’s vital statistics 2014: Achievements

Total contributions Why members contribute How members contribute Sources of additional funding (leverage) % A company’s community investment includes Other organisations e.g. government 111 companies participated in LBG’s Motivation matters. A company’s CCI is % annual benchmarking exercise making driven by different factors. Contributions different types of contributions. The LBG Members continue to be a catalyst for driving Customers a total contribution of £1.6 billion, can be reactive one-off payments, proactive framework outlines four different types of funding from other sources, and so boosting equivalent to an average contribution and strategic community investments or contribution that companies can make: cash the contribution from their own resources. contributions, employee time, any donations Employees through payroll of £352 for each employee. business-related activities that deliver This additional funding is called ‘leverage’. % Leverage community benefits. of in-kind (products, services and pro bono) and the management costs taken to run the Other employee donations corporate community investment programme. Average leverage per member Other sources e.g. general public % 59% Community investment 56% Cash .m .m .m % Average Contribution

.m .m .m 27% Charitable gifts 29% In-kind

14% Commercial initiatives 8% Time in the community How do people benefit?* How do organisations How do employee 7% Management costs benefit?* volunteers benefit?* Total Contribution Using the LBG impact map of three broad categories of change, members Support provided by companies can benefit Companies increasingly strive to measure can identify the impact on beneficiaries charitable organisations in a number of the value of CCI to the business and its . BN as a result of their programme. different ways – from long term capacity employees. The LBG model measures the building to ad hoc financial support. impact on employees across three key . BN The range of impacts is shown below. areas of benefit. . BN

Supported Total beneficiaries organisations Employees involved

What members support m , , Through the LBG framework companies can map Average contribution per employee their contributions across eight broad focus areas: .% Average contribution as % of pre-tax profit Total where impact measured Total where impact measured Total where impact measured % .% Economic million , , Average contribution as % of turnover % development % Other support , Health 66% Positive change in behaviour /attitude 43% Improved existing /delivered new services 62% Changed behaviour/attitude Employees participating in paid company time % Arts and 43% Improved quality of life 31% Increased their profile 35% Improved job-related skills . million culture Working hours contributed 22% Developed new skills or increased 25% Reached more people or spent more 32% Improved life skills personal effectiveness time with clients % % % Social Education Environment welfare 14% Took on more staff or volunteers

% Emergency relief 7% Improved management systems

* The impact data on this page represents achievements by those companies capturing LBG impact data on their programmes, currently 60% of members. Percentages for impact categories do not amount to 100% as beneficiaries often experience a number of benefits as a result of an activity and therefore could be included in more than one category – although are not double counted in the overall total beneficiaries

4 MAXIMUM IMPACT: THE LBG ANNUAL REVIEW 2014 LBG’s vital statistics 2014: Contributions LBG’s vital statistics 2014: Achievements

.m .m .m 27% Charitable gifts 29% In-kind

Supported Total beneficiaries organisations Employees involved

% Emergency relief 7% Improved management systems

MAXIMUM IMPACT: THE LBG ANNUAL REVIEW 2014 5 Like-for-like trends 2012-2014

Comparing consistent data across years is one of the key benefits of using LBG. The data How members contribute 2011-2013 here is calculated on a like-for-like basis, using information from the 75 companies who have Cash In-kind Time Management (inc. pro-bono) costs reported data for the past 3 years. 50% 50% 49%

34% 34% 35% Total contributions as a percentage of pre-tax profit

9% 9% 2014 1.4% 8% 8% 7% 7% 2013 1.4% 2012 2013 2014 2012 2013 2014 2012 2013 2014 2012 2013 2014 2012 1.1%

Contributions per employee What members support 2011-2013 2014 £440 / $688 / €519 Health Education Social Economic Environment Arts & Emergency Other 2013 £438 / $693 / 540 € welfare development culture relief support 2012 £415 / $666 / €478 43% 42%

31%

Since 2012, total contributions from these 23% 18% 20% 19% 15% 12% 12% companies have remained steady at around 10% 8% 8% 7% £1.1 billion. The contribution as percentage 6% 4% 5% 5% 3% 3% 3% 1% 1% 1% of pre-tax profit in 2014 has remained the same over the last two years. ’12 ’13 ’14 ’12 ’13 ’14 ’12 ’13 ’14 ’12 ’13 ’14 ’12 ’13 ’14 ’12 ’13 ’14 ’12 ’13 ’14 ’12 ’13 ’14

The trend towards more strategic, longer term community investment is maintained Why members contribute 2011-2013 as companies seek to align community giving with corporate responsibility strategies Community investment Charitable gifts Commercial initiatives 60% in the community reflected in 60% of contributions classified 57% 56% as community investment.

The data shows an overall increase in health- 31% 31% 29% related contributions across these companies.

This is largely due to greater health-related 14% 13% contributions by pharmaceutical companies. 9% The trend across other sectors actually shows

education programmes receiving the biggest 2012 2013 2014 2012 2013 2014 2012 2013 2014 proportion (26%) of contributions.

Employee participation 24% 39% Employees are getting more and more made by employees through payroll giving Percentage of employees Companies matching involved in the community activity of and other donations account for 32% of undertaking paid-time Companiespayroll giving matching their company from offering their time additional funds leveraged in 2014. voluntary activity, payroll giving to volunteer, to contributing financially compared on a like-for-like to the company’s community initiatives The increasing number of employees basis with 20% in 2013, through payroll giving or fundraising participating in community initiatives and 17% in 2012 62% activity. The like-for-like comparison reflects the effort of companies to Companies matching over the last three years shows that the engage employees in activities in their employee fundraising percentage of employees undertaking local communities. This is also reflected paid-time volunteering increased from in company policies such as paid time off 17% to 24% (this increase is due to a to volunteer, with about two-thirds (63%) combination of higher volunteer numbers of members offering an annual allowance 24% and lower employee numbers overall amounting to 23 hours per employee Companies matching across these companies). Contributions on average. employee volunteering

6 MAXIMUM IMPACT: THE LBG ANNUAL REVIEW 2014 The global picture

LBG’s membership base is global and so our In addition to the founding group, whose results use the LBG Framework through participation in data reflects community activity in Europe, the are reported here, local LBG benchmarking LBG benchmarking groups to share and drive best Americas, Middle East, Africa and Asia-Pacific groups also operate in Australia and New Zealand, practice in CCI. (the map below shows how contributions are Czech Republic, Poland, Romania, Spain and spread across these regions). Many members Asia-Pacific. The LBG International network In the US, our partnership with ACCP (Association are multinational companies that use the LBG brings these groups together to develop LBG as of Corporate Contributions Professionals) in the framework to measure and report on extensive the international standard for measuring and Measurement Academy (www.accprof.org/events/ma) global community investment programmes, managing corporate community investment. This has brought major US companies such as FedEX, sometimes across more than 100 countries. means that over 200 companies around the world Hasbro, ConAgra Foods and BD into the network.

+ % % countries covered Europe members reporting by LBG data international contributions

% North America % Asia & Pacific

% South America

% Middle East & Africa

What’s next?

New opportunities for data management

Collecting data is one of the biggest practical challenges in applying LBG. To better support members in addressing this challenge we are launching a new online data portal.

This facility puts community managers at the heart of their data, enabling them to record, measure and manage their community programmes in one place. They can view a live picture of their achievements and compare against previous years, sector trends and LBG averages.

The portal will be rolled out to members, according to their needs and interest, over coming months.

MAXIMUM IMPACT: THE LBG ANNUAL REVIEW 2014 7 Who’s using LBG?

Professional Services: Pharmaceuticals: Financial Services: • The Royal Bank Utilities & Services: • Accenture • Abbott • Access Bank of Scotland Group • Centrica • Deloitte & Touche • AbbVie • Allianz Group • UBS • Deutsche Post DHL • KPMG • AstraZeneca • Arab African • UniCredit • EDP • PwC • GlaxoSmithKline International Bank • Zurich • Electricity North West • Aviva • Galp Energia Travel & Hospitality: Industrial & Energy: • AXA UK Consumer Goods: • National Grid • British Airways • BAE Systems • Bank of America • 3M • npower • First Group • Jaguar Land Rover Merrill Lynch • AkzoNobel • Port of Tyne • Go Ahead • Johnson Matthey • Barclays Decorative Paints UK • Royal Mail • Manchester Airport Group • Michelin • Capital One • Bacardi • Scotia Gas Networks • Thomas Cook • Rolls-Royce • Citibank • British American Tobacco • ScottishPower • Shell UK • Deutsche Bank AG London • Britvic • Severn Trent Retail: • Siemens • Friends Life • Clarks • Terna • Asda • Wood Group • ING • Coca-Cola Enterprises • Thames Water • Home Retail Group • Intesa San Paolo • Coca-Cola Hellenic • United Utilities • Jeronimo-Martins Property, Construction, • Investec Plc • Diageo • John Lewis Partnership Housing & Facilities: • IPF (International • Heineken Media: • Marks & Spencer • BAM Construct UK Personal Finance) International B.V • BSkyB • Sainsbury’s • British Land • Nationwide • JTI • Dentsu Aegis Network • The Boots Group • Carillion • Novo Banco S.A. • McDonalds • Experian • The Co-operative Group • Hammerson • Old Mutual Group • Mondelez • Hibu • Intu Properties plc • Provident Financial • L’Occitane • Liberty Global Europe Tech & Telecoms: • ISS UK • Prudential • L’Oreal • Pearson • Alcatel-Lucent • JLL UK • Rothschild • Philip Morris • Reed Elsevier • ARM • Land Securities • RSA Group International Management • BT • Lend Lease • Santander UK • Procter & Gamble UK Legal: • Deutsche Telekom AG • L&Q Housing Group • Schroders • Ricoh UK • Freshfields Bruckhaus • Intel Corporation • Sanctuary Housing Group • Standard Chartered • SABMiller Deringer • Portugal Telecom • Shaftesbury • Standard Life • Unilever • Linklaters • STMicroelectronics • The Crown Estate • Olswang • Willmott Dixon • Wragge & Co

Why join the network?

Being part of the LBG network brings a host 3 Driving best practice in 6 Events, news and networking of benefits and services to support companies community investment • Regular events for members, including Participation in on-going improvement introductory workshops, webinars 1 Global framework in community investment management and sector groups (over 30 this year) Using a consistent international benchmarking and the opportunity to learn from and • Members’ newsletters, with news framework for managing and measuring share international best practice on measurement topics, company corporate community investment, which reports and forthcoming events helps companies to assess consistently what 4 Personal support resources they commit and the results achieved Sustainability consultant from Corporate • Annual conference Citizenship as account manager with 2 Data for benchmarking, consultancy time to help apply the 7 LBG branding analysis and reporting LBG model to your programmes Use of the LBG logo and the right to cite Use the information to benchmark your use of the model in external publications community investment performance against 5 Tools and guidance sector peers and use in major corporate Access to members-only section of the LBG responsibility indices (DJSI, GRI, CR Index), website with full guidance on implementing as well as for internal management the model, case studies, all member data decisions and external communications and examples of reporting

Contact LBG

Corporate Citizenship 5th Floor Holborn Gate, 26 Southampton Buildings, London WC2A 1PQ LBG is managed by Corporate Citizenship, a global corporate responsibility UK +44 (0) 20 7861 1616 US 1 212 226 3702 Singapore +65 6836 9098 consultancy with offices in London, New York and Singapore [email protected] www.lbg-online.net www.corporate-citizenship.com