LBG Companies Reconsider Philanthropy And Community Investment

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Focus Group Community by worldwaterweek via flickr

Members of LBG – the global measurement standard for community investment and philanthropy – are applying principles and processes to assess how their contributions benefit society.

Corporate community investment and philanthropy is not subjected to the same rigours of measurement and return on investment as other business activities. Research published by Corporate Citizenship, a global sustainability consultancy, revealed that many companies invest in communities without setting out what they want to achieve, and without measuring the difference their contributions make.

But leading companies are upping their game and recognising the very real business risk of wasted resources. These companies are members of and they are applying robust principles and procedures to measure how their contributions really benefit communities and the business.

Launching this week, the LBG Annual Review 2016 reveals that in 2015/2016 LBG members contributed US$ 3.3 billion to community and philanthropic investments, reaching 65 million beneficiaries worldwide. The review also reveals key trends emerging amongst LBG member companies:

Focus

The majority of resources contributed by LBG companies now centre on a discrete number of larger-scale, longer-term projects run in partnership with community organisations with mutually agreed objectives:

79% of contributions made by LBG member companies supported strategic community investment projects and commercial initiatives in the community – compared to just 38% in 2007 – as LBG member companies are thinking seriously about the causes and issues that are of most relevance to their businesses

Impact

LBG member companies are measuring the change and impact they generate through their activities. Using LBG’s framework they are able to measure the changes experienced by the people reached by their contributions:

32% of beneficiaries experience a positive change in behaviour, 31% develop new skills and 24% improve their quality of life

Win/Win

Companies are getting better at mobilising their employees for community benefit and realising a real return to the business as a result:

600,000 employees of LBG member companies actively participated in voluntary activity. Where measured; 41% improved their job-related skills, 58% improved their personal impact (self-confidence etc.) and 59% made positive changes in behaviour as a result.

Jon Lloyd, Head of LBG commented: “LBG member companies are placing an increasing focus on impact, and they are asking hard questions of the community activities which they support to understand whether, and to what degree, they add value and generate change in the areas they are focussed on. This strategic approach is leading to more effective and impactful giving.”

Ultimately, the process of measurement and application of LBG’s framework improves the effectiveness of companies’ contributions to the community: “LBG and measurement helps businesses and third sector organisations to get more from corporate responsibility programmes” stated Siemens plc.

The full LBG Annual Review 2016 can be downloaded here. A webinar to bust the common myths of community investment measurement will be taking place on Wednesday 30th November, find out more here.