Community Investment for a Changing World

LBG Annual Review 2015 Community investment for a changing world

www.lbg-online.net @LBG_CCI A global network Our framework A simple vision

We believe that effective measurement aids more effective community investment. Simplifying impact measurement So our vision is simple; we look to a world where every business measures its LBG’s measurement framework is the global standard for measuring the totality of corporate community investment. community investment and shares this in The model enables companies to consistently manage, measure an open, transparent and consistent way. and benchmark their contributions, helping them to strategically progress their community programs. LBG’s wide use is rooted in its simplicity, inclusivity and flexibility: any company at any point of the measurement journey More than 220 companies around the world share this vision and can apply the model, whether at the beginning of recording make up LBG’s network, which provides a platform for companies contributions or in the advanced stage of assessing impacts. to work with each other, and with their partners in the community, The framework is integrated into investor ratings like DJSI to improve measurement and make a greater difference. and supports reporting standards like GRI. Practitioner-led, and steered by representative companies from the network, LBG has pioneered measurement so enabling companies to move forward from asking How much do I give? to What difference do I make? Inputs What’s contributed; the resources a company provides to support a community activity.

LBG’s geographic spread How: Cash, time, in-kind, management cost

Companies in the network are headquartered across more Why: Charitable gift, community investment, than 20 countries. They operate in, and apply LBG assessment commercial initiative in the community across, more than 100. What: Issue addressed (education, health etc.)

Where: Location of activity

Outputs What happens; the activities delivered, numbers reached, funds raised and business-related activity resulting from the contributions made.

Community outputs: Numbers helped, activities held etc.

Leverage: Additional funds raised

Business outputs: Media coverage, awareness among customers, employees etc.

What do we mean by community investment?

LBG measures companies’ voluntary contributions to community organizations or activities. Different terms are often used to Impacts What changes; The changes that refer to such activity: Social investment, corporate citizenship, happen to individuals, organisations philanthropy, company giving, social programs, and strategic and the company, in the short or philanthropy are just a few. For LBG’s purposes community longer-term, as a result of the activity. investment is the term that is used to cover all such activity. Community impacts: Change in beneficiaries, organisations and/or society

Business impacts: Change in business performance

2 Measurement is about Companies in the LBG network recognize that measurement supports the management and more than numbers effectiveness of the community program; it is not something to be done for its own sake but is a valuable business tool that can drive strategy, improve program delivery and strengthen communications. Like other areas of business performance, you can better manage what you measure.

Inputs Outputs Impacts Measurement Using the LBG framework Benchmarking

ensures consistent measurement of provides essential means you know where you stand contributions, results and impacts. management information. in comparison to your peers and best practice.

Strategy and objectives Management and delivery Communication and engagement Measurement provides the context Measurement identifies the results for setting strategic objectives and achieved for the community and Data strengthens reporting, associated targets and KPIs. It can the returns to the business. improves performance in external inform a new strategy or assess This can inform and improve indices, demonstrates commitment progress in an existing one. project delivery, energize to external stakeholders and can employees and make the case enhance the employee proposition. for greater investment.

Embedding LBG significantly improves impact measurement and therefore helps businesses move from the “how much” to the “so what”. — Pam Webb, Head of Zurich Community Trust and LBG Chair

3 The power of benchmarking Spanning different countries and sectors; LBG enables businesses to compare like for like, gauge 'what good looks like' and set meaningful and measurable goals for the future. — Chloe Keen, Senior Citizenship Manager, Nationwide

Our annual benchmarking exercise is core to LBG. The benchmark About the inputs: About the outputs: About the impact: It enables companies to How we invest in communities What happens with our investment The changes our investments make compare their top-line This year’s data combines information across LBG’s international network and so provides the deepest set of benchmark data yet. This depth of coverage helps us to better identify Companies are getting smarter about the Measuring outputs means determining what Measuring impact is about understanding achievements with their trends in community investment and see how the companies that lead the field are taking management of their community programs. happens as a result of community change. LBG enables, and challenges, on new approaches and measurement processes. LBG’s rich input dataset shows how, and to contributions. It’s an opportunity to take the companies to establish how they effect peers as well as within and what extent, things are changing. From the temperature of engagement and see some change in the people and the organizations across sectors. The insight basics of how companies contribute through results. The numbers of people reached, that they help, as well as the employees that the drivers for community activity and on to the organizations supported or the support their programs. As a result, the they obtain puts them in a new ways of delivering benefit; the data additional funds brought to community culture is changing, with more companies stronger position to make highlights where LBG members are pushing programs from sources such as employees assessing their programs to establish where the dial forward. or customers are all markers by which and how they are having a genuine impact. strategic decisions about % companies in LBG can assess their progress. their community programs. $ Some highlights from the How the contribution breaks down Reaching the people that need support Changing lives for the better 2014-15 benchmark are of beneficiaries made positive people have directly benefited shared here. 67% cash changes in behavior, from the contributions of 21% improved their well-being 93m companies in the LBG network 41% 20% in-kind and 13% acquired new skills

7% time Companies Combined Countries where actively revenue of companies in 173 participated in $2.3t companies in the 130+ the network $ 6% management costs the benchmark benchmark are making contributions

Making strategic contributions Supporting the non-profit community

of inputs support strategic organizations have been A global contribution community investment supported by the LBG network % projects or commercial 260k through one-off donations or Building the capacity of 80 long-term partnerships Measurement begins by assessing what’s contributed to the community. Collectively, the initiatives in the community community organizations LBG network contributed more than $3.6 billion (£2.2 billion, €2.7 billion) to community projects around the world in 2014/15. This substantial sum equates, on average, to more than $21 million for each reporting company. of supported organizations $3.6B raised their profile, TOTAL 2014/15 However, LBG isn’t just for companies with big budgets. With total contributions across Mobilizing the workforce 28% improved their services, CONTRIBUTION companies ranging from $90,000 to over $350 million, any company with any size community 30% 23% reached more people budget can use the LBG framework to assess the contribution it makes. employees have been actively Using key comparators to ‘normalize’ data, such as contribution as a percent of pre-tax engaged in community activity profit (1.1%), or contribution per employee ($639, £387, €479), means that, whatever their size, 600k during paid-working time companies can make sensible comparisons. € Companies in the LBG network, listed by sector on the back of this document, have the added advantage of being able to drill down to sector and company-specific data to make $ The company is a catalyst more direct comparisons. $ $ additional funding is raised by companies from sources Average percent Contributions Companies’ total 15% like governments, customers of pre-tax profit equate to an $90k to contributions and employees £ contributed 1.1% $639 average of $350m range from less by companies $639/£387/€479 than $100,000 Tackling crucial issues Making companies great places to work to community per employee to hundreds activity of millions of contributions support of employees improved education (35%) or health (22%). their job-related skills 57% Social welfare, arts and economic 48% through involvement in development are also widely £$€ the community supported Note: Not every company in the LBG network reports data against every indicator. Therefore the results presented here are based on those companies that report against a particular indicator. Financial data is presented primarily in US$. 4 For the period covered by this report $1.00 is equivalent to approximately £0.60 and €0.75 respectively 5 Spanning different countries and sectors; LBG enables businesses to compare like for like, gauge 'what good looks like' and set meaningful and measurable goals for the future. — Chloe Keen, Senior Citizenship Manager, Nationwide

About the inputs: About the outputs: About the impact: How we invest in communities What happens with our investment The changes our investments make

Companies are getting smarter about the Measuring outputs means determining what Measuring impact is about understanding management of their community programs. happens as a result of community change. LBG enables, and challenges, LBG’s rich input dataset shows how, and to contributions. It’s an opportunity to take the companies to establish how they effect what extent, things are changing. From the temperature of engagement and see some change in the people and the organizations basics of how companies contribute through results. The numbers of people reached, that they help, as well as the employees that the drivers for community activity and on to the organizations supported or the support their programs. As a result, the new ways of delivering benefit; the data additional funds brought to community culture is changing, with more companies highlights where LBG members are pushing programs from sources such as employees assessing their programs to establish where the dial forward. or customers are all markers by which and how they are having a genuine impact. companies in LBG can assess their progress.

How the contribution breaks down Reaching the people that need support Changing lives for the better

of beneficiaries made positive people have directly benefited 67% cash changes in behavior, from the contributions of 21% improved their well-being 93m companies in the LBG network 41% 20% in-kind and 13% acquired new skills

7% time

$ 6% management costs

Making strategic contributions Supporting the non-profit community

of inputs support strategic organizations have been community investment supported by the LBG network % projects or commercial 260k through one-off donations or Building the capacity of 80 long-term partnerships initiatives in the community community organizations

of supported organizations Mobilizing the workforce raised their profile, 30% 28% improved their services, 23% reached more people employees have been actively engaged in community activity 600k during paid-working time

$ The company is a catalyst

$ $ additional funding is raised by companies from sources 15% like governments, customers and employees Tackling crucial issues Making companies great places to work

of contributions support of employees improved education (35%) or health (22%). their job-related skills 57% Social welfare, arts and economic 48% through involvement in development are also widely £$€ the community supported 5 LBG in action LBG is a practical, useful tool that not only LBG changes the way corporations and organizations think about community drives discipline and transparent reporting, investment. It ensures effective assessment and enables the definition of targets. but also helps build a stronger case for — Eduardo Moura, Principal Sustainability Consultant, EDP (Energias De Portugal) corporate community investment. — Stefan Rissi, Director Community Investment, JTI

Using the LBG Opposite left: Playing Shakespeare with Deutsche Bank is a Born to Be framework enables project, which has benefited Deutsche Bank General Mills Ferrovial 70% of state schools in London Jaguar Land Rover Pearson ANZ companies to assess Youth development Education Water & sanitation Humanitarian relief Literacy Financial capability/savings Opposite right: General Mills individual projects employees have provided in a consistent e-mentoring to more than 300 students fashion and so Deutsche Bank helps communities Global food company, General Infrastructure company Automotive company Jaguar Education company Pearson, In 2014 ANZ, the international and economies to prosper and Mills aims to advance community Ferrovial combines its corporate Above: Jaguar Land Rover Partners Land Rover (JLR) aims to create aims to improve literacy levels bank, contributed over draw together build social capital wherever the nutrition and food security, responsibility and business with the Red Cross in projects opportunities for 12 million through its community activity. $14m (AUD 17.6m) to the program-wide Bank operates around the world. improve education outcomes strategies to achieve its financial, across several countries people by 2020 through its In 2014 it committed $25m (£15m) community, benefiting 300,000 It invested more than $100m and strengthen communities social and environmental Global CSR Program; over 40 of cash and other resources people. Its strategy focusses on results. Here are Right: Pearson’s Read for (€80m) in community projects through its activity. In 2014 it objectives. In 2014 it contributed My School has reached more innovative projects that support (including books and employee social and economic inclusion some examples of in 2014, helping 5.8 million contributed $150m to community $9m (€6.9m) in resources than 200,000 schoolchildren education and talent, time) supporting 18,000 through financial literacy programs. beneficiaries through 3,000 projects, benefitting more than reaching more than 400,000 humanitarian and health issues organizations and helping more Saver Plus is a financial the overall results supported organizations. 1.7 million people. people and supporting more or technological innovation for than 2 million people. education and matched savings A core element of its In one project it partners than 650 organizations. social good. In 2014, it One way Pearson addresses program, developed with the that members have community activity is Born to Be; with BestPrep, an educational A core element of its contributed more than $20m literacy is through Read for My non-profit Brotherhood of St been able to achieve a global youth engagement non-profit, in an e-mentoring activity is its social infrastructure (£12m) of cash, time and in-kind School (RFMS), an online reading Laurence in Australia. It helps program, which tackles barriers partnership. General Mills program: Drinking Water & support and reached more competition open to primary and people on lower incomes to along with examples to employment through projects employees share their business, Sanitation in Development than 1.7 million people through secondary schools in England. improve financial capability and of the specific aimed at encouraging young career and financial skills with Cooperation. Since 2011 it has the program. RFMS aims to help children to increase savings. Participants set people to pursue their aspirations, middle and high school students worked with 10 NGOs to fight Red Cross, a Land Rover discover the pleasure of books a savings goal and save towards projects that develop the skills they need and by email and through hands-on against poverty and carry out partner since the 1950s, delivers by encouraging and rewarding it, and when the goal is reached, prepare themselves for the world experiences. In 2014 the company development projects that provide many of JLR's humanitarian and regular reading. In the last three ANZ matches participants’ contribute to them. of work. In 2014, the Bank contributed $55,000 of cash and drinking water and sanitation in health projects. In 2014, JLR years, Pearson provided $2.5m savings dollar-for-dollar up to invested $16.4m (€12.3m) and employee time to support the Africa and Latin America. invested $4.3m (£2.6m) in (£1.5m) of funding and an online $390 (AUD500). Since 2004 32,500 hours of employee time in program. 193 employees got So far Ferrovial has committed vehicles, cash and employee library of books. In 2014, RFMS ANZ has invested over $23m Born to Be. More than 1.2 million involved and helped more than $2.4m (€1.8m) to the program, time to Red Cross projects in reached more than 200,000 (AUD 30m) in Saver Plus, young people were reached as a 300 children, 90% of whom have for 10 projects across Colombia, over 15 countries. These include schoolchildren and teachers. It is benefiting nearly 15,000 result. Of these, more than been assessed to have improved Peru, Ethiopia, Mexico, and disaster preparedness programs improving skills and changing participants. Research shows 150,000 developed new skills, their skills, or developed new Tanzania, which has improved the in Australia, mentoring in behavior around reading with that it is changing behavior with 300,000 raised their aspirations ones, as a result. quality of life for more than Portugal, road safety in Korea 86% of teachers involved 87% saving the same amount through increased confidence 110,000 people. and water and sanitation in reporting that it had positively or more since completing Saver and motivation and 600,000 South Sudan, collectively impacted their whole-school Plus, and building skills with accessed new opportunities they are assessed to have reading culture and 75% 85% reporting more control (routes to learning, higher improved the lives of more reporting that pupils are more over their finances. education etc.). than 145,000 people. likely to read for pleasure having taken part.

6 7 LBG in action LBG is a practical, useful tool that not only LBG changes the way corporations and organizations think about community drives discipline and transparent reporting, investment. It ensures effective assessment and enables the definition of targets. but also helps build a stronger case for — Eduardo Moura, Principal Sustainability Consultant, EDP (Energias De Portugal) corporate community investment. — Stefan Rissi, Director Community Investment, JTI

6 7 Why use LBG? Benefits of being in the LBG network include: • Accessing the combined knowledge and • Transforming and improving Businesses have found that being part experience of more than 220 companies their activity with robust management information of the LBG network and using a consistent • Saving time collecting, analyzing and managing data by accessing • Better demonstrating their international benchmarking framework leading-edge tools and expert support commitment to transparency and best practice brings many advantages. • Increasing the efficiency and effectiveness of their reporting and communications

Who’s using LBG?

Financial Services Engineering & Manufacturing Consumer Goods Legal Professional Services • Allianz Group • BAE Systems • 3M • Freshfields • Accenture • ANZ • CSL • Adidas Group Asia Pacific Bruckhaus Deringer • Deloitte • Arab African • Gestamp • AkzoNobel • Linklaters • Experian International Bank • Holden Decorative Paints UK • Olswang • KPMG • Australian Unity • Jaguar Land Rover • Bacardi • Wragge Lawrence • PwC • Aviva • Johnson Matthey • Britvic Graham & Co • AXA • Michelin • Clarks Technology & Telecoms • Banco Santander • Rolls-Royce • Coca-Cola Media • Alcatel-Lucent • Bank of America • Siemens Asia Pacific Group • Astro Malaysia • ARM Merrill Lynch Asia Pacific • Toyota Australia • Coca-Cola Enterprises • BSkyB • BT • Barclays • Wesfarmers Chemicals, • Coca-Cola Hellenic • Dentsu Aegis Network • Datacom • Bankinter Energy & Fertilisers • Diageo • Foxtel • Deutsche Telekom AG • BBVA • Wood Group • Fuji Xerox • Liberty Global Europe • IBM Australia • Bloomberg • General Mills • Pearson • Intel • BRD Groupe Natural Resources • Heineken España • REA Group • Optus Societe Generale • AngloGold Ashanti • Japan Tobacco • Reed Elsevier • Orange Polska • Capital One • MOL Group • JT International SA • Vocento • Ricoh UK • Citi • MPRL E&P • JTI UK • Singtel • Credit Suisse AG • Mubadala Petroleum • Kellogg’s Utilities & Services • ST Microelectronics • Deutsche Bank • Repsol • Kruszwica • Agbar • Telefónica • Fundacja Bankowa • Wesfarmers Resources • L’Occitane • Anglian Water • Vodafone Hungary im. L. Kronenberga • Woodside Energy • Mondelēz • Australia Post • Workday Foundation • GE Money Bank • PepsiCo Asia, • Centrica • GMHBA Property, Construction, Middle East & Africa • Deutsche Post DHL Travel, Hospitality & Leisure • HSBC Housing & Facilities • Philip Morris International • DP World • Accor Asia Pacific • ING • Abengoa Management S.A. • Ecoembes • Adelaide Football Club • International • Abertis • Plzeňský Prazdroj • EDP • Budapest Airport Personal Finance • Acciona • Swisse • Endesa • Carlton Football Club • Intesa Sanpaolo • BAM Construct UK • Żywiec Zdrój • Ferrovial • Cricket Australia • Investec • British Land • Galp Energia • Essendon Football Club • Macquarie • Ferrovial Pharmaceuticals • Gas Natural Fenosa • FirstGroup • Medibank • Hammerson • Abbott • Iberdrola • Go Ahead • National Australia Bank • Intu Properties • AbbVie • Jemena • Hawthorn Football Club • Nationwide • ISS UK • AstraZeneca • Luxmed • London City Airport • Novo Banco • JLL UK • GSK • National Grid • Manchester Airport Group • Provident Financial • Lafarge Cement • Polpharma • New Zealand Post Group • New Zealand Rugby • Provident Polska Magyarország • Origin Energy • North Melbourne • Prudence Foundation • Land Securities Retail • Port of Tyne Football Club • Prudential • Lend Lease • Boots • REE • Power Community • Raiffeisen Bank • Mirvac • Castorama • Royal Mail • Qantas • RBS • OHL • Coles • ScottishPower • Richmond Football Club • Rothschild • Quintain • David Jones • Severn Trent • Sydney Airport Corporation • Schroders • Sanctuary Housing Group • Home Retail Group • SGN • Tabcorp Holdings • St James’s Place • Scentre Group • Inditex • Skupina ČEZ • West Coast Eagles • Standard Chartered • Shaftesbury • Jeronimo-Martins • Terna Football Club • Standard Life • Skanska • John Lewis Partnership • Thames Water • Suncorp • Stockland • Marks & Spencer • Transpacific Other Products & Services • Teachers Mutual Bank • The Crown Estate • Myer Industries Group • Challenger Institute • Toyota Finance • Vicinity Centres • Southern Co-operatives • United Utilities of Technology • UBS • Willmott Dixon • Target • Goodstart • UniCredit • Tesco Polska • Wesfarmers Corporate • Zurich • The Co-operative Group

Contact LBG

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