Just as shareholders and consumers alike are pressuring companies to return the highest value for the lowest cost, the long-term impacts of corporate community investment programmes continue to be under-measured and under-reported.
Impact measurement should encompass all the long-term outcomes derived from the programme – both positive and negative, and exclude results that would have happened anyway. The shift from measuring inputs only – simple philanthropy – to now more robust impact measurement – social return on investments (SROI) – is critical to linking community spending to business benefits.
SROI has become a hot topic for more progressive multinationals who seek to track the fundamental difference that a project makes over time. It is a specific tool designed to monetise costs and benefits arising from projects with a social purpose (e.g. funding for a training scheme to get unemployed people into work will save social security costs and generate tax revenue). Yet despite the good intentions of some CCI managers to measure long-term impacts, the easier, and therefore more common, metrics are identified for measuring shorter term outputs (e.g. how many unemployed people were trained?)
Arguably, “impact” is becoming an over-used and therefore inevitably devalued word. One large US-based multinational firm has a global volunteering day called Impact Day, but it appears there are few metrics and tools to measure the global impact of its programme.
There is also little evidence of impact measurement in the much-vaunted Global Reporting Initiative. As Justine Bentham of KPMG noted: “We would like more of the measurement frameworks to be harmonised so that when best practice is developed, such as the LBG model, it can be applied to any reporting system such as GRI.”
Until companies themselves try harder to demonstrate results, initiatives such as the GRI will continue to focus on the input side of community investments. And community affairs managers will continue to struggle to prove the business and community benefits of their contributions through impact measurement.
There is some good news though, as some companies are stepping forward to lead on impact measurement. Eight London Benchmarking Group members, including Serco, Vodafone and BT, sponsored a recently released study, More than Making Money, in order to look at the practicalities of measuring impact on society, by assessing the perceived drivers of measurement and conducting a review of current practice. Others are setting the example of how advanced planning and creative metric evaluations can lead to impact delivery. Cadbury Schweppes’ well constructed programme with Water Aid in cocoa farmer communities in Ghana is a great example, as is Diageo’s partnership with Tomorrow’s People, not to mention the ongoing impact evaluation Deloitte has started for its Employability initiative.
Robert Smith of Serco sums up the challenge for companies ready to take impact to the next level: “We strongly endorse the whole concept of measurement to inform the decisions we make to maximise the value we deliver. The challenge is not whether to measure but rather what to measure, not just to justify our actions but to improve and enhance what we do.”
Shannon Skaggs is Manager of the London Benchmarking Group at The Corporate Citizenship Company.
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