Welcome to the

12th LBG Annual Review of Community Investment

Presenting the latest highlights and trends in corporate community investment across Australia and New Zealand.

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report

What is LBG?

LBG’s measurement framework is the global standard for measuring and benchmarking corporate community investment. The model enables companies to consistently manage, measure and benchmark their contributions, helping them to strategically progress their community programs. The global network of companies using LBG provides a platform to share experience, best practice and new ideas.

The LBG Framework

Inputs

What's contributed?

How (form of contribution)
  • Cash
  • Time
  • In-kind (including pro bono)
  • Management costs

Why (driver for contribution)
  • Charitable gifts
  • Community investment
  • Commercial initiatives in the community

What (issue addressed)
  • Education
  • Health
  • Economic development
  • Environment
  • Arts and culture
  • Social wellfare
  • Emergency relief

Where (location of activity)
  • Europe
  • Middle East and Africa
  • Asia Pacific
  • North America
  • South America

Outputs

What happens?

Community outputs
  • People reached/supported
  • Type of beneficiary
  • Organisations supported
  • Other company-specific output measure (e.g. environment)

Business outputs
  • Employees involved in the activity
  • Customers/consumers reached
  • Suppliers/distributors reached
  • Other influential stakeholders reached
  • Traditional/digital/social media coverage achieved

Leverage (additional resources from other sources)
Total leverage split by
  • Employeee donations via payroll giving
  • Other employee contributions
  • Customers
  • General public
  • Other organisations/sources
  • Employees involved in own time
  • Hours contributed in own time

Revenue foregone for community benefit
  • Financial products/services
  • Utility bills/fees/services
  • Accommodation, office space, venue hire
  • Media/advertising space

Impacts

What changes?

Community outputs
On people
  • Behaviour or attitude change
  • Skills or personal effectiveness
  • Quality of life/well-being

On organisations
  • Improved or new services
  • Reached more or more time with clients
  • Improved management processes
  • Increased their profile
  • Taken on more staff or volunteers

On the environment
  • Impact on the envonrment
  • Impact on the environmental behaviour

Business Impacts
On employee volunteers
  • Job-related skills
  • Personal well-being
  • Behaviour change
On the business
  • Human resource benefits
  • Stakeholder relations/perceptions
  • Business generated
  • Operational improvement delivered
  • Uplift in brand awareness
  • Positive media coverage

How companies use LBG

Janet Liu - ANZ ANZ

Communicating community investment to key stakeholders

Janet Liu - Corporate Sustainability and Community Manager at ANZ

ANZ is a founding member of the LBG Australia and New Zealand chapter and we've been using the methodology for over ten years.

The LBG methodology has helped us to communicate our community investments to a wide range of stakeholders, including our customers, shareholders, internal decision makers and staff. LBG allows us to quantify our contribution into an easily digestible format for different audiences. For example, our LBG data feeds into our annual reports, is published on our website and used to promote our community work on social media.

We receive excellent feedback from stakeholders on our volunteering and community programs. The methodology helps us to communicate the real-life impact of our programs which is important for us to share as it helps build our social license to operate. Telling those positive stories also helps to make us an employer of choice and contributes to our employees' engagement.

The independent verification provided by the LBG team means that our assurors are willing to accept our LBG summary report as evidence of our community contributions. The data also feeds directly into our Dow Jones Sustainability Index submission.

Kate Driessen - Myer Myer

More focused and methodical approach

Kate Driessen - Community Relations Advisor, Myer

The LBG methodology allows Myer to measure and track our corporate community investment in a focused and methodical way. Through LBG our community investment has become quantifiable, feeding into our strategic planning and better equipping us to meet our community program objectives.

For the first time this year we extended our measurement to include impacts. This has been an exciting next step in our desire to ensure we are making a meaningful difference through our partnerships and initiatives.

From an employee perspective, we are able to better assess our workplace volunteering and fundraising program. We are committed to enabling our employees to give through the workplace but we need to work within the challenges - and opportunities - posed by the retail environment. Capturing our employee giving inputs through LBG helps to demonstrate the substantial volunteering and in-kind support occurring daily within our business operations. In this age of disruption, it is so important to look at what community support a business can offer beyond the traditional avenues and using LBG helps quantify this.

Being an LBG member provides assurance for our own auditing purposes and provides a useful snapshot of our annual contribution. I greatly appreciate being part of the LBG member group and having access to a network of peers and knowledge centre specifically geared towards corporate community investment.

Kate Driessen - Myer Myer
Brooke Pettit - Foxtel Foxtel

Access to dedicated community investment expertise

Brooke Pettit - Community & Corporate Social Responsibility Manager, Foxtel

Since Foxtel joined LBG two years ago, our membership has proved to be invaluable. When we came on board the LBG team provided expertise and guidance to help us embed measurement systems and better manage and evaluate our community programs and strategic partnerships.

The reporting process has enabled us to clearly align what we support, with our core business objectives, help us understand where our positive impacts are and really tell the story of our community investment. Having the support of the LBG team through this process has really helped Foxtel redefine ambitious goals for our community investment and community service announcement airtime.

In addition to the day-to-day insights from the LBG team I get a lot out of the opportunities to learn and share within the network. LBG is more than a membership; it’s a practitioner forum of like-minds.

The State of Corporate Community Investment i

The State of Corporate Community Investment (CCI) 2017 survey compliments the LBG Annual Review which measures and benchmarks what LBG member companies have achieved in the past year. The survey asked CCI professionals to share their aspirations and plans for the future.

The 2017 survey was open to all CCI professionals, whether or not they were LBG members. There was equal representation of LBG and non-LBG members within the respondent group, providing an ideal opportunity to consider some of the variations in responses.

LBG’s measurement framework ensures a robust and credible approach to measuring the real value and impact of CCI to business and society.
Read more

Aligning budgets and partnerships with business strategy

Aligning budgets and partnerships with business strategy

A considerable proportion of respondents – 39% - said that their budgets would increase in the coming year, with a further 59% saying their budgets would remain the same. There was a notable difference in results here for LBG and non-LBG respondents: half of LBG respondents indicated budget increases, compared to one third of non-LBG respondents; and half of LBG respondents indicated budgets would remain the same, compared to 63% of non-LBG members.

Just over one-fifth of respondents plan to increase the number of flagship partners they work with, while 15% plan to reduce numbers. Those who indicated plans for a decrease cite drivers of better alignment with strategy, and to enable fewer, “deeper” relationships with partners. Partners received between $10,000 to over $1 million, with most receiving between $100k-$250k.

Average spend on flagship partnership or program chart

Over 40% of companies are aspiring to invest in contributions that achieve value by 1) focusing on achieving greater alignment with business strategy and delivering shared value projects; and 2) improving measurement of outcomes. Both LBG and non-LBG respondents noted the challenge of finding partners who were strategically aligned and who could deliver on outcome/impact expectations.

Jo Booth of The Smith Family, and LBG for Community participant says “It is heartening to read that there will be a greater emphasis on strong alignment and reporting. We all know these are key ingredients for a successful and sustainable NFP/business relationship. More than ever, a clear and logical alignment is paramount if both parties are to gain public trust and increased buy in from employees.

“The LBG for Community program supports this, providing a real 'road map' for the partnership between an NFP and a corporate partner. It helps both parties, at the outset, hone in on what can be delivered, measured and reported on. Being able to have these conversations with confidence is a great way to start AND grow a partnership.

“The sustainability of the sector will very much be bolstered by better reporting and evaluation. I don’t just mean the ‘numbers’ but am talking about the impact, covering both the rational and the emotional and lives changed or lessons learnt. I’m looking forward to the exciting times ahead and the changes we can make to communities across Australia.”

Read more about flagship programs in Corporate Citizenship’s insights.
Read more about our program to upskill community partners, LBG for Community.

Read more

Impact measurement is key to engaging stakeholders

Impact measurement is key to engaging stakeholders

The importance of impact measurement continues to be recognised, with 91% of respondents seeing this as being important, very important or essential – up from 80% in 2016. The use of measurement in enabling reporting back to Board and other stakeholders was well recognised, with many noting the increasing internal pressure to justify spend and demonstrate value, both in terms of social impact and commercial return. Respondents also noted the importance of measurement in enabling performance improvement of programs over time.

63% of respondents noted they had measured impacts for at least one of their community programs (73% for LBG respondents and 56% for non-LBG).

The greatest barrier to measuring impacts was identified to be a lack of understanding around what and how to measure (45% of respondents), closely followed by other resourcing constraints (42%). Other barriers included cost and lack of consideration in partnership development, with 16% of respondents each.

Resources to support measurement can be found as part of Corporate Citizenship’s Impact for Change program, aimed at helping companies measure, improve and communicate impact. A recent Insight webinar A recent Insight webinar also looks at how to move from having community activities in place to measuring them.

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Increasing public disclosure of targets

Increasing public disclosure of targets

40% of respondents publicly disclose CCI targets, either as a percentage of pre-tax profit, dollar value or output/impact related data (including people involved, volunteer hours or beneficiary outcomes). An additional 8% intend to disclose targets in future. This suggests increased disclosure compared to 2016, when only a quarter of respondents indicated they published targets.

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Aligning with the Sustainable Development Goals

Aligning with the Sustainable Development Goals

It is almost two years since the launch of the United Nations Sustainable Development Goals (SDGs). Responses to the State of CCI survey suggest some businesses are starting to seek out associated business opportunities, with just over half of respondents indicating alignment of community investments with the SDGs. Furthermore, 55% of respondents see alignment with the SDGs as being a primary focus for CCI over the next 10 years.

While these numbers represent a slight majority, they somewhat lag behind Corporate Citizenship’s research that revealed 81% of millennials surveyed believed that the private sector has a very important role to play in achieving the Global Goals.

The four goals most referenced by respondents were:

  • GOAL 4: Quality Education (25%)
  • GOAL 11: Sustainable Cities and Communities (23%)
  • GOAL 3: Good Health and Well-being (22%)
  • GOAL 5: Gender Equality (19%)

“It is positive to see growing engagement from businesses in the SDGs through this research – a strong trend we are also seeing through the UN Global Compact. The majority of CEOs we have surveyed see the SDGs as a great framework through which to rethink approaches to sustainability, as well as identify core business opportunities to contribute to the agenda. Leading businesses in Australia and around the world are embedding the SDGs in their sustainability and broader business strategies, although to take this to scale, we need to drive new collaborations, innovation and the translation of the Global Goals into local action,” says Alice Cope, Executive Director, Global Compact Network Australia

Corporate Citizenship takes a look at how businesses have responded to the Global Goals, and what initial implications and opportunities the Goals have presented.

Read more

Workplace giving continues to be important

Workplace giving continues to be important

Workplace giving continues to be a key part of a company’s CCI activities. Two thirds of respondents have a program in place that they either aim to maintain or increase participation in. A further 14% plan to start a workplace giving program.

Noted challenges include: being able to articulate the value derived from workplace giving; achieving buy-in from the payroll area of the business; and balancing the “competition” for donations between workplace giving and the corporate program. Several noted the need to find the right program to both support the community investment strategy and to engage staff.

Lisa Grinham, CEO of Good2Give says “It’s terrific to see companies embracing workplace giving as an easy and effective way to engage employees in giving. This is consistent with broader sector data from the Giving Australia 2016 research, which indicates growth in corporate giving in contrast to the stagnation of individual giving in Australia.

“Good2Give’s Workplace Givers Revealed research shows that, of more than 1000 employees, 80% feel having a workplace giving program demonstrates a genuine commitment to the community and makes their company a better place to work. By providing an open choice workplace giving program, companies are demonstrating how much they value the diversity and generosity of their people. It also respects that people are time poor and seeking trusted, non-intrusive channels through which to give and offers businesses a futureproof giving solution that is online and suits a digital native workforce.

“Workplace giving provides quantifiable proof of a company’s commitment to communities for shareholders and customers who want to invest in brands that make a positive difference in the world.

“We recognise the challenges facing Australian companies, including the digital transformation of workplaces. Giving is also part of this digital revolution which should be embraced. Driving workplace giving through technology provides CSR, payroll and HR teams with a solution that simplifies and centralises this important component of employee engagement, making it easier for people to participate and easier for businesses to manage. It also delivers efficient, trusted, ethical funding to charities – and that’s a win for the not-for-profit sector.”

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The big opportunity - corporate volunteering

The big opportunity - corporate volunteering

Organisations appear to acknowledge the value of a corporate volunteering program, with 83% of respondents indicating they have a program in place, and an additional 10% planning to start one. Furthermore, over half of respondents indicate they aim to either increase participation or increase focus on skilled volunteering. Similarly to workplace giving, in addition to resourcing requirements and employee engagement, one of the common challenges stated was the alignment of the volunteering program with the community investment and business strategy. Achievement of this continues to present a significant opportunity for companies to grow their positive impact on society whilst accruing meaningful business benefits. Connecting volunteering to employee development remains an underutilised opportunity. Other stated challenges included resourcing requirements for the volunteer program and employee engagement.

A research study, commissioned by City of London and undertaken by Corporate Citizenship, analysed the business case for volunteering, seeking to assign a financial value to the skills gained by employees. ‘Volunteering: The Business Case’ presents the findings of the study and includes an evaluation tool designed to enable companies to gather hard data on competency development.


“The expectation of business to contribute to community purposefully and tangibly has never been greater.” Says Mandy Burns, Director - Stakeholder Development at Be Collective. “As a society, we understand the vital role of business to help look after our planet, to contribute to our global Sustainable Development Goals and to show care for their people. Volunteering, sharing resources and donating is expected. Measurement, verified reporting and benchmarking are key to ensure the impact is real. The Be Collective team has used the experience of running The Body Shop in Australia to develop a global tool to mobilise our collective goodwill and make engaging employees, verifying, managing and measuring social impact of corporate volunteering, donating goods and community investment simple. www.becollective.com revolutionises the way we connect and contribute to community.”

Read more

Accountability straight to the top

Accountability straight to the top

One quarter of respondents indicated their Board or a Board level committee had direct responsibility for their community investments, while 46% said an Executive sponsor or Executive level committee hold responsibility. Sustainability and corporate social responsibility functions took the lead in 20% of cases, with Foundations accounting for an additional 4%.

Mike Tuffrey, co-founder of Corporate Citizenship, notes “These findings are very encouraging and show that the majority of companies understand the role that community investment can play in achieving corporate objectives. Looking back over the last decade or two, we've seen a big increase in activity overall, but some firms still see the function only in operational terms - making small donations or organising employee volunteering, for example - rather than recognising its contribution also to the company mission and business priorities. Accountability straight to the top, whether to board or ExCo, is the key for both strategy and execution.”

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The future of CCI

The future of CCI

Participants were asked to identify where they believed CCI to be going over the next ten years. The greatest trend identified was towards “social innovation” such as shared value and social procurement programs, with 74% of respondents highlighting this. This was followed by strategic community investment (62%), alignment with the SDGs (55%) and commercial initiatives such as cause related marketing (47%). These results demonstrate continued drive towards investment opportunities that align with business strategy. This is further reinforced by the fact that only 7% of respondents felt that more traditional charitable giving, such as ad-hoc and one-off donations, would play a key role in the future.

LBG has developed an approach to social innovation programs. A foundation of this approach, LBG and Corporate Citizenship’s ‘Investing for Shared Value’ paper, proposes a framework for measuring shared value and presents a companion assessment tool for organisations.

Jeff Oatham, Director of LBG, states “The world faces some big challenges that can’t be solved through charitable budgets alone. Community investment remains important, but we must harness the scale and power of business solutions to achieve the change needed. LBG’s upcoming guidance on social innovation will help business understand this exciting and impactful new area.”

Read more

The challenges in CCI

The challenges in CCI

Respondents were asked to share what they saw as their key challenges for CCI. Measuring impacts and being able to effectively tell the story of achievements were highlighted as key areas where people needed the most help, with almost 80% wanting help with measurement and 51% wanting help with storytelling. Aligned with this, a quarter of respondents felt that upskilling community partners and building their capacity would help them achieve their goals. Several noted tensions between aligning to corporate strategy and “doing social good”.

Some of the key themes to emerge from respondents were:

  • Standing out from the crowd: “Everyone wants a piece of the media action”
  • The need for collaborative working/solutions: “Trying to help fix a huge problem with small projects”
  • Resourcing constraints: “Competing demands for funding”
  • Demonstrating impact: “Measuring value, ROI, and showing correlated brand loyalty as a result of community investment”
  • Storytelling: “Meaningful aggregation of the community impact in order to "Tell our Story" at an aggregated level” and “Remaining authentic and credible in an environment of increasing ‘impact washing””

Access a range of insight reports and webinars aimed at addressing key challenges here.

2017 LBG Results Overview

LBG is a global network of companies who apply an international standard to enable them to measure, report and then improve upon contribution to the community.

The results of the 12th LBG benchmark in Australia & New Zealand are presented here, along with the previous eleven years of reported data. Click the switch to ‘global’ to view a comparison against LBG averages globally.

How Members Contribute

i
This year the value of cash as a percentage of the total contribution has decreased by 6%. The number of volunteer hours contributed by employees in work time has nearly tripled, due in part to a number of companies electing to publicly commit to targets for employee volunteering. In-kind contributions rose by over 5% to 25% being the second highest percentage on record. Management cost contributions rose by 2% to a 12 year high of 14%. This is thought, in part, to result from members spending more on communicating information about their activities.

Contribution as a % of
pre-tax profit

0.61%

Why Members Contribute

i
Whether companies are making a
charitable donation; a strategic longer-term community investment; or a commercial initiative that delivers community benefits, each is driven by a different motivation. Community investments took an even larger ‘slice’ this year increasing by 9% showing greater focus by members on pursuing strategic long-term partnerships, with charitable donations continuing to reduce as in previous years. Commercial initiatives remain unchanged.

Contribution as a % of
total revenue

0.14%

What Members Support

i
For the past three years Social welfare
has been the dominant beneficiary of member contributions. However, this year it saw a drop of 8% to 21%. Support for health initiatives has been boosted again resulting in the highest percentage in this area with an eleven-year high.
Arts and culture initiatives halved to be back inline within previous year’s results. One significant donation that saw Arts and Culture double in 2016 was not repeated and we appear to be reaching our norm of around 6%.
The percentage allocated to the ‘other’ category dropped from 8% to 5% as a focus area. This is an encouraging indicator that members are increasingly focused on where resources are targeted.

Contribution per
employee

$891 i
Community contributions as a percentage of pre-tax profit (EBITDA) increased to 0.61%. As a percentage of total revenue, contributions remained steady, and the average contribution per employee climbed to the highest figure since LBG reporting began. This can partly be attributed to a smaller employee pool and this decreasing trend of FTE has been evident over the last 6 years.

*Please note totals may not equal 100% due to rounding.
^yearly average conversion rates have been used to convert dollar figures to AUD

LBG'S Vital Statistics: Contributions

In 2017, the total contribution of all LBG members decreased by $11m. Members are stating that cash contributions increases are less likely as they move towards enhancing their contributions through in-kind donations and volunteering.


The financial services sector no longer represents the largest contributor, a trend that was observed over the majority of reporting years. The Retail and Wholesale sector have now taken over the reigns as largest contributor.

Total Contributions

Contributions by Sector

Employees

Nearly all members that offer workplace giving programs are now matching, to some extent, employee contributions.

The average participation rate by employees rose to 5%. This modest increase reflects the need for companies to constantly seek to communicate with their employees on the levels of engagement and impacts resulting from their contributions.


Volunteering participation increased considerably with major efforts by companies that chose to publicly commit to employee volunteering targets. As a result, the number of working hours contributed nearly tripled this year to over one million.

The average number of hours each employee contributes has increased from 11 to 12 hours.


Volunteering


14%

Employees volunteering in company time


1,164,316

Working hours contributed


12

Average of hours donated per employee


$19m

Value of time


Workplace Giving


56%

Members offer workplace giving programs with 90% matching donations to some extent.


5%

Members reported that the average staff participation rose from 4% to 5%.


11,916

Staff donating figures rose 10% on 2016 figures.

LBG'S Vital Statistics: Achievements

Members continue to be a catalyst for driving funding from third parties such as customers, government or their own employees. This additional funding is called ‘leverage’.

Total Value of Leverage

Where did the Leverage come from?


$9.8m

In total, employee donations (WPG and other direct employee leverage) were down against 2016 figures but year on year they have trended upward since 2012.


$2.3m

Average funds leveraged per reporting member increased by 30%.


$101m

Estimated revenue foregone for community benefit is up by more than $3 million from 2016.


Increasing use of the LBG social impact methodology assisted members to report the outputs and impacts of their contributions, such as the number of people reached or supported, and benefit they experienced as a result.

01

How do people benefit?

Using the LBG impact map of three broad categories of change, members can identify the impact on beneficiaries as a result of their programme.

Total beneficiaries

 

88% positive change in behaviour/attitude
98% developed new skills or increased personal effectiveness
98% improved quality of life and/or wellbeing
02

How do organisations benefit?

Support provided by companies can benefit charitable organisations in a number of different ways - from long term capacity building to ad hoc financial support. The range of impacts is show below.

Supported organisations

 

73% improved existing/delivered new services
27% improved management processes
100% increased their profile
47% took on more staff or volunteers
03

How do employee volunteers benefit?

Companies increasingly strive to measure the value of CCI to the business and its employees. The LBG model measures the impact on employees across three key areas of benefit.

Employees involved

 

23% improved job-related skills
55% experienced a personal impact
24% positive behaviour change
*The impact data on this page represents achievement by those companies capturing impact data on their programs. Not all members currently report impact data. 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.

Member Overview

 

Reporting members

 

Members who reported in both 2016 & 2017

 

Average of full time staff dedicated to Community Investment activities

Member representation by

Sector in 2017 Benchmark