2011 lbg canada annual benchmarking report

BenchmarkingReport 2011

Executiummary report

Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation Accountability Strategic Alignment KPIs Expertise Assurance Capacity Network of Professionals Results Engagement Strategic Valuation Principles Goal Setting Best Practice Data Review Community Code Credibility Evaluation

ValueClarity

MotivationCommunity Investment

Audit Advise

Achieve Performance Measurement

Making a DifferenceHighest Standard

Impact

BenchmarkingMeasurementAnalysisCredible ReportingSustainabilityEnhanced Communication7 Step ApproachLeadershipCorporate Social ResponsibilityTransparency

BenchmarkingReport 2011

LBG Canada is a community of companies seeking to maximize the impact of community investment – for the community and for the business. Together, LBG Canada companies set the highest standard in community investment management, performance measurement and reporting in Canada.

The LBG Canada approach is based upon the London Benchmarking Group Model, a recognized global standard launched in Britain in 1993, which has now been in use internationally for more than 18 years.

LBG Canada is facilitated by the SiMPACT Strategy Group, a specialist agency known for its leadership on measuring, maximizing and valuing social impact in corporate community investment and in the broader society.

About LBG Canada

www.lbg-canada.ca

LBG Canada is facilitated by the SiMPACT Strategy Group

www.simpactstrategies.com

Table 1. LBG Canada community profile

2011 Benchmarking Summary

The results of the 2011 Annual Benchmarking process (of 2010 results) have been summarized in this document in order to share information with the LBG Canada community and general public.

For more information about LBG Canada or for access to further benchmarking data, please visit: www.lbg-canada.ca or email [email protected].

Audit Advise Achieve

LBG Canada community profile 2010 2009 2008

Companies involved 36 26 24

Number of companies benchmarking 33 20 22

Industries represented 12 12 12

Benchmarking Sectors 4 2 2

Community investment professionals involved 169 90 64

Companies investing in the US and internationally 48% 25% 23%

Companies whose budgets will increase/stay the same in coming year

90% 85% 71%

Total value of contributions benchmarked $245 Million $126 million $116 million

Average percentage of giving benchmarked 86% 87% 62%

Total community investment transactions reviewed in preparation for benchmarking process

27,728 14,400 7,100

Audit. Advise. Achieve. ALBG CANADA PARTICIPANTS*

*as of June 2011

Growth in number of community investment professionals involvedin LBG Canada. 2006 = 16

2009 = 90

2007 = 45

2008 = 64

2010 = 115

2011 = 169

Every day, community investment professionals are asked to provide evidence of the value of their work. LBG Canada’s purpose is to enable solid answers to questions about program value, direction and results. Answers that are clear, definitive and emphatic.

Participating in our annual benchmarking exercise is the essential first step. The portfolio-wide review provides each company with the insights, evidence and management information needed to maximize the value of corporate investment in community.

Involvement in LBG Canada ensures a consistent definition of community investment, across investment styles, industries, sectors and diverse operating environments. The line-by-line review of every investment (27,000+ in 2011!) ensures that the definition is applied consistently. As a result, the best and emerging management practice examples are transferable and relevant to community investment professionals everywhere. This is a truly unique approach within the community investment and broader corporate social responsibility arenas in Canada.

With the benchmarking results in hand, every LBG Canada company’s step two is to review their individualized Insights and Opportunities Report. Each Insights and Opportunities Report highlights both strengths and opportunities to improve the results achieved across their community investment portfolio.

Step three is then taken with SiMPACT as the unique priorities of every LBG Canada company are identified for action and response. Thus far in 2011, company priorities expressed include strategies to leverage additional resources for community partners, qualitive measurment of community impact, achieving community benefit to create business value and a deeper understanding of the Social Return on Investment (SROI) methodology.

The management information provided in the LBG Canada Annual Benchmarking Report is the foundation for professionals and organizations seeking to maximize the impact of their community investment portfolio. With the review of an annual AUDIT, community investment results are reported with greater credibility and confidence. Along with management insights, LBG Canada companies recieve tools to ADVISE how to maximize the impact of investments. Altogether, SiMPACT looks forward to supporting companies to demonstrate the strength of community partnerships and measurable impact to ultimately ACHIEVE success.

Report Preface

“Is our community investment portfolio meeting expectations?”

“How do I communicate results achieved more effectively?”

“What is the real value of our investments?”

Stephanie RobertsonPresident, SiMPACT Strategy GroupJune 2011


Table of Contents

Executive Summary

Performance measurement - understanding your portfolio

Employee Giving & Volunteering

Management Issues

external Resources Leveraged

External Reporting

Community Profile

Looking Forward

Notes & Definitions

Acknowledgements

1

3

5

9

13

15

17

19

21

23

www.lbg-canada.ca

A

2010 headline performance indicators 2010 2009 2008

Companies involved 36 26 24

Companies benchmarking 33 (100%) 20 (77%) 22 (92%)

Total contributions benchmarked $245,108,394 $125,867,873 $116,296,364

Average estimate of contribution captured 86% 87% 62%

Group contributions as a % of total revenue 0.20%* 0.38% 0.21%

Group contributions as a % of pre-tax profit 0.95%* 1.12% 0.60%

Participants reporting leverage 73% 90% 95%

Total value of leverage reported $88,920,881 $80,467,751 $77,127,308

Total leverage/ contributions ratio 36 ¢ per $1 64 ¢ per $1 66 ¢ per $1

Average leverage/ contributions ratio 23 ¢ per $1 32 ¢ per $1 25 ¢ per $1

Total value invested in the community (combined company giving & external resources leveraged)

$334,029,275 $206,335,624 $193,204,998

LBG Canada Annual Benchmarking Report 2011 Summary1

.

Each cycle, every LBG Canada company participates in a detailed, line-by-line audit of their entire community investment portfolio. This year, 27,728 lines of community investment transaction data were reviewed by SiMPACT Strategy Group, in preparation to discuss key management and measurement trends with colleagues assembled at the 2011 LBG Canada Annual Benchmarking meeting.

The purpose of the annual audit is to assist each company in identifying current portfolio strengths and opportunities for improvement. The process is designed to match expectations to current performance, and to clearly highlight where expectations and performance are not aligned.

With this information in hand, the community investment professional is equipped to advise senior management on tactics designed to achieve the goals of current strategy. Even more, the information presented enables professionals to advise where current strategy is not adequate, i.e. to take steps towards achieving corporate goals in new and exciting directions.

For LBG Canada companies, benchmarking is performance measurement. While benchmarking enables assessment of the current situation, it also allows confidential, informed company comparison to peers and emerging best practice. LBG Canada benchmarking enables disclosure of current challenges so that potential solutions to those challenges can be brought forward, and then addressed.

Executive Summary

Audit Advise Achieve Audit Advise Achieve

Table 2. LBG Canada Headline Indicators

*When a company submits less than 95% of total expenditure for review, percentages are based on an estimation of total amount contributed, not total amount benchmarked.

In the five years of LBG Canada Benchmarking cycles, one challenge to the community investment professional has stayed constant – communicating the value of community investment to key internal and external stakeholders. Every year, more LBG Canada companies begin to tackle their communication challenges through use of their benchmarking data, finding new and creative ways to illustrate the impact of their investments and engage stakeholders through more effective reporting.

As each LBG Canada company identifies performance improvement goals for 2011, SiMPACT looks forward to supporting their efforts to improve measurement and streamline communications with key stakeholders. Meeting these two objectives will advance understanding of community investment as a valuable, strategic activity.

AUDIT.ADVISE.ACHIEVE

“We used our LBG Canada benchmarked data to help us fill out the Dow Jones Sustainability Index. This saved us time and effort.”

Jamie Niessen, Former Manager, Community Investment, TransCanada Corporation

“LBG Canada has helped us to think in new ways. Simple things like writing down our motivations and filling out the benchmarking survey has helped us to consider things we’d never thought of before. Our involvement has been incredibly valuable.”

Noreen Stuart, Community Investment Specialist, Servus Credit Union Ltd.

“The LBG Canada Data Collection Tool is the ONLY place where we can see all of what we give in particular categories across all regions. This is of incredible value as we look at our portfolio.”

Amy Hanen, Senior Manager, Community Relations, TD Bank Financial Group

2www.lbg-canada.ca

A

Chart 1. Why companies join LBG Canada

16%

41%

44%

44%

44%

50%

50%

53%

63%

0% 20% 40% 60% 80%

Other

Improved good governance

All of the above

Improved decision-making

Skill development and peer-to-peer learning

Increased credibily for reporting and other communications

Performance measurement of priority projects

Connection into a global network of companies

Benchmarking for essential management information

A community investment portfolio is a collection of activities that reflect how a company’s commitment to community is a part of its corporate culture. No one investment meets the needs of every stakeholder, no matter how strategic the program design. For this reason, it is essential that all companies consider the value of the whole before diving too deeply into the value of individual projects.

Yet, when companies start asking ‘what is the value of our community investment program?’ they often narrow their focus on specific projects too quickly. The first step should always be to reflect upon whether the current portfolio of projects truly reflects the company’s corporate profile and expectations of the whole community investment budget.

In LBG Canada terms, every community investment occurs as a result of one of three motivations: commercial, social or philanthropic. Descriptions of each motivation are provided in Figure 1.

Each motivation reflects potential expectations for a corporate investor’s involvement. They also reflect expectations to report on measureable business and community benefit, across timeframes.

Benefits associated with community investment are often perceived as too intangible to be measured. This perception often limits expectations of the portfolio and diminishes its perceived value. Involvement in LBG Canada is focused on changing internal perception of what is valuable and can be measured. Enabling companies to identify their investment motivation and then measure results against expectations is a first step toward meeting this objective.

The first performance measurement question to be asked is ‘does my portfolio truly reflect corporate expectations of our community investment budget’? If investment motivations are not balanced with expectations, there is a need to understand where the imbalance occurred, and then an opportunity to adjust. The key is to ensure that the balance is right, i.e. a direct reflection of corporate culture and internal expectations for expenditure designated to be invested in community.

Chart 2 illustrates motivations to investment as reported re: 2010 portfolios. As presented, the community investment team is more able to speak to investments made to directly support business objectives (commercial), longer-term investments that build community and business value over time (social) and the portion of the portfolio that is more difficult to measure, more transactional in nature and geared toward providing short term support (philanthropic).

being as directly involved.

Longer-stakeholders and promote corporate brand through

Voluntary

Philanthropic Investments

Social Investments

Business Basics

Figure 1. Motivation to investment in community - LBG Canada definitions


26%

55%

19%

Philanthropic Investment

Social Investment

Commercial Initiative

Chart 2. Motivation to invest across LBG Canada


Audit Advise Achieve Performance Measurement – Understanding Your Portfolio

Dan O’Grady, ManagerCommunity Partnerships & Investment

Enbridge Inc.

“The portfolio-wide assessment of Enbridge activities makes it easier to link community investment to priorities across business units such as government relations, community relations, human resources and marketing.

These links have always been present intuitively, now we have the language and metrics for them to be expressed.“

DEFINING COMMUNITY INVESTMENT

Evaluating community investment portfolio strengths in relation to peers requires comparability. Comparability requires clear definitions of what community investment is, and what community investment is not. When the results are presented, there is an opportunity to strengthen management practices and overall portfolio results.

Clarity on overall portfolio results brings forward opportunities to strengthen key projects in order to deepen their value from both business and community perspectives. Once the overall portfolio has been assessed, LBG Canada companies use a seven-step approach (seen in Figure 2) to outline, investigate and maximize priority projects. This is the value of performance measurement – aligning both expectations and results to achieve maximum possible benefit for the community and for the business.

Figure 2. LBG Canada 7-steps to performance measurement

7.

generated for a

Commercial

1. Set Program Goals (for the community and the business)

2.

Type of

3. Value Inputs Assess Outputs

Total Value 4. External Resources Leveraged 5. 6.

The total $ value of cash, in-kind, employee

management costs.

Measurecommunity

impact

Measurebusiness

impact

Performance measurement of

program results in the community

Performance measurement of

program results uponthe business


Social Investment

3%

72%

25%Yes, everyone knows what CI is and should be

Somewhat, some people clearly understand CI

Not really, our team's role is not well understood

Chart 3. Defining community investment (CI)

4www.lbg-canada.ca

A

.

As LBG Canada grows, the benchmarking process evolves in response to company priorities, challenges and emerging trends. A clear overall trend is increased investment into some form of support for employee giving of money, or time through volunteering.

Engaging employees has become a priority amongst LBG Canada companies, with the benchmarking results reflecting new performance measurement insights that inform company approaches to employer supported volunteering and giving. The following provides a snapshot of key trends and overall 2011 results from the LBG Canada Employee Volunteering & Giving survey.

Ninety-six percent (96%) of all LBG Canada companies involved in the 2011 annual benchmarking process engaged their employees through some form of volunteering and/or giving program. As the types of employee engagement programs vary, the survey found 77% of all LBG Canada companies support volunteering, while 22% prefer to encourage employee donations as part of their strategy.

Almost 20% of LBG Canada companies are choosing to invest in all forms of employee engagement, including volunteering during working hours and non-working hours.They offer a robust giving and volunteering strategy which includes payroll and matched giving as well as corporate donations through a ‘Dollars for Doers’ program.

Employee Giving & Volunteering


Chart 4. Companies that support employee giving and volunteering programs

96% of all LBG Canada companies involved in the 2011 annual benchmarking process engaged their employees through a volunteering and/or giving program.


19%

75%

66%

59%

53%

69%

59%

22%

77%

96%

0% 20% 40% 60% 80% 100%

19% of LBG Canada companies offer every type of program

75% encourage payroll giving

66% match employee volunteer time (NwH) with corporate $

59% match employee donations with corporate $

53% support both DWH and DWH volunteering

69% support NWH volunteering

59% support DWH volunteering

22% do not support volunteering, but do encourage employee donations

77% support volunteering (either DwH or NwH)

96% of companies support employee volunteering and giving (some form of)


6www.LBG-Canada.ca

Whether companies dedicate time for their employees to volunteer during working hours (59% support DwH volunteering) or encourage employees to volunteer outside of the office, during non-working hours (69% support NwH volunteering), volunteering has become a staple of employee engagement programs across LBG Canada, with over half (53%)of the companies supporting both forms of volunteering.

Employee giving compliments volunteering as an alternate way to engage employees with 59% offering matched giving incentives, as well as 66% of LBG Canada companies combining volunteering (NwH) and matched giving through their Dollars for Doers program. Companies have also adopted payroll giving as an effective way to invest in the community with seventy-five percent (75%) incorporating payroll as a tool to support employee interest in community giving.

Although there is no “one-size-fits all” design and delivery of employee engagement programs, the growth in company activity in employee giving and volunteering demonstrates a shift in thinking as companies adopt and integrate employee engagement into their community investment portfolio. As this trend becomes a reality, SiMPACT Strategy Group looks forward to further evolving the benchmarking process to present management insights that contribute to ensuring employee volunteering programs are strategic, safe and successful.

A

66% of companies match employee volunteer time (non-working hours) with corporate dollars and 59% match employee donations.

6www.lbg-canada.ca

POLICIES IN PLACE

It is encouraging to see three quarters of the companies with employee volunteering programs indicate they do have formal guidelines in place for management approval for paid time off to volunteer. This is an important guideline to ensure consistency and clarity for employees interested in participating in volunteering opportunities.

Management approval of requests for paid time off to volunteer 75%

Internal recruitment of volunteers 25%

Procedures in the event of over-subscription 20%

Code of conduct during employer-sponsored volunteering activities 35%

Health & safety on volunteer sites 40%

Assessment of insurance coverage needed 25%

Matching employee volunteering to human resource development opportunities 0%

Table 4. Percent of companies with corproate volunteering guidelines

Is your time/reward ratio encouraging volunteers?

Chart 4. Time/reward ratios - Dollars for Doers programs

0

10

20

30

40

50

60

$0 $200 $400 $600 $800 $1,000 $1,200

Hou

rs v

olun

teer

ed

$ matched

40 hrs: $50040 hrs: $100

50 hrs: $75050 hrs: $250 /$300 40 hrs: $500

40 hrs : $1000

15 hrs : $250 15 hrs : $1000

A

Z

Company ACompany Z


Opportunities for Reflection

Questions to be asked about employee volunteering & giving include:

Which types of employee volunteering are the best fit for our corporate culture, operating • structure, and overall strategy?Do we have the right guidelines in place to ensure our employees have access to volunteering • opportunities, and are clear on what to expect?Are we utilizing the right communication tools to ensure both employees and potential community • partners are aware of the opportunities we are offering, and are motivated to participate?What metrics do we have in place to understand the value our volunteer program is delivering to • both the community and the business?

DOLLARS FOR DOERS

64% of LBG Canada companies offer ‘Dollars for Doers’ programs. There is a wide range of management approaches to supporting committed ‘Doers.’ Within Chart 5, point ‘A’ is an example of the most generous hours/corporate donation ratio, i.e. $1,000 for 15 hours of volunteering. Point ‘Z’ is an example of the opposite end of the scale. The risk to the company represented by point Z is that their Dollars for Doers program may not achieve the goal of engaging employees by supporting their volunteering interests, as a $100 contribution might not be adequate to motivate a 40 hour time commitment.

The low percentage (25%) of companies assessing insurance coverage needs for volunteering opportunities poses a potential risk in the course of a company-sponsored event. A community partner may have insurance coverage to protect the employees, but it is not safe to assume that such coverage is in place.

The LBG Canada Annual Program Includes:

Review and audit of the community investment portfolio in order to strengthen internal valuation and credibility of external reporting

A customized Insights & Opportunities Report highlighting steps to performance improvement in planning, measurement & evaluation, program structure and guidelines, and external reporting

Individualized support to clarify performance improvement objectives and support toward their achievement

Planning, measurement and communication to illustrate the value of priority projects

Access to the resources within a growing national network of community investment professionals

Valuable Portfolio Insight

Minimum Time Commitment

Export of investment data for audit by SiMPACT (LBG Canada valuation principles): 5 minuteswith a centralized system

Community investment program management survey: 45 minutes

Employee volunteering & giving program management survey: 45minutes

Review of audit results: 1 2 hours

Review Insights & OpportunitiesReport with SiMPACT, to identify performance improvement goals: 1 2 hours (optional)

Time commitment: 4 6 hours,per year

www.simpactstrategies.comwww.lbg canada.ca

LBG Canada is facilitated by the SiMPACT Strategy Group | Email: [email protected] | Phone: +1 403 444 5683

Additional Opportunities

Engage with professional peers, address challenges and trends at the LBG Canada Annual Meeting: 2 days

Access webinars on leading practice, use information available within the Volunteer Canada’s Centre for Excellence: individual

Prioritize performance measurement, access SiMPACT coaching and support: individual

Achieving the Highest Standard in Community Investment.

“SiMPACT is easy to work with and

knows its LBG Canada material inside

and out. Each team member has

provided me with outstanding council;

overall, a great experience.”

Erin Satterthwaite, Director, Community Investment and Internal Communications,

Vale

LBG Canada Annual Benchmarking Report 2010 - Executive Summary9

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As the economy stabalized in 2010, only 10% of LBG Canada companies stated they will experience a budget decrease in 2011. Thirty-four percent (34%) of companies stated their community investment (CI) budgets will remain unchanged, while 56% stated their investments would increase (up 11% from 2009). SPENDING ALLOCATION

Companies often join LBG Canada as a result of desire to capture and properly value community investment spend that is occurring in other departments. While some of this additional investment may be only partially eligible or ineligible altogether, the process of gathering investment data from across the business helps to solidify understanding of what community investment is, and what it is not. It also assists the community investment team to identify expenditure that falls outside agreed focus areas.

During the benchmarking process, LBG Canada companies estimate the percentage of portfolio captured (i.e. 80%). Typically, the balance that is not captured represents investment occurring in other departments. LBG Canada companies make progress in gathering this information over time, drawing upon the experience of peers as an example of how to establish internal routines to capture this information.

SENIOR MANAGEMENT APPROVAL

As illustrated in Chart 7, the threshold to require senior management approval for expenditure varies between $5,000 and $250,000. Interestingly, there is no correlation between threshold amount and total contributions budget or size of company. Rather, the broad range reflects differences in corporate culture and decision-making processes.

Management Issues

PORTFOLIO BUDGET & OVERALL SPENDING


9LBG Canada Annual Benchmarking Report 2011 Summary


Chart 7. Threshold for contributions requiring senior management approval

$50,000

$100,000

$20,000

$250,000

$5,000

$5,000

$10,000

$10,000

$0 $100,000$200,000$300,000

Under $1 million

$1-$5 million

$5 - $10 million

Over $10 million

threshold amount

port

folio

siz

e ($

of e

xpen

ditu

re)

Lowest investment amount threshold

Highest investment amount threshold

Chart 6. Expections for changes to community investment budget in 2011

10%

34%56%

Decrease

Stay the same

Increase

10%

34%56%

Decrease

Stay the same

Increase

10www.LBG-Canada.ca

FOCUS AREAS

In this 2011 benchmarking cycle, $245 million of community investment (2010 expenditure) was included in the data review.

This totaled more than 27,728 individual transactions reviewed and benchmarked on a line-by-line basis.

It is interesting to note that while 95% of companies invest in the focus area of social services, this same focus area is only receiving 10% of the total value of company contributions. This is an indication that many companies are contributing in smaller ways in this particular area. This insight may be valuable to a company seeking to create a portfolio that is unique and could potentially stand out by becoming a large investor in an area where most other companies are making smaller contributions.

LBG Canada company investment is presented by focus area, for the entire group, in Chart 8 and by number of companies investing in each focus area in Chart 9. These results remained consistent with results reported in the previous year.

One note, from 2012 onwards, benchmarking of focus area will be separated into two steps – theme (education, health, etc) and demographic (children, youth, Aboriginal Peoples, etc). This will provide LBG Canada companies with additional information to inform decision-making.

0.07% 0.79%10%

5%

5%

5%

1%

0.14%

19%

0.96%6%

23%

3%

10%

5%

Agriculture

Aboriginal Peoples

Arts & Culture

Capacity Building

Children & Youth

Civic Leadership

Disaster Relief

Diversity

Education

Employee Programs

Environment

Health & Wellness

Sport & Recreation

Social Services

Other

Chart 8. Investment dollar spending by focus area

5%

20%

25%

35%

35%

50%

60%

70%

70%

75%

75%

75%

80%

95%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Disaster Relief

Diversity

Capacity Building

Other

Aboriginal People

Sport & Recreation

Employee Programs

Civic Leadership

Children & Youth

Health & Wellness

Environment

Arts & Culture

Education

Social Services

% of companies investing in focus area

Chart 9. Number of companies investing in focus area

10

MULTI-YEAR PROJECTS

At the end of 2010, 30% of LBG Canada companies had already allocated 50% or more of their community investment budgets to multi-year projects. While on one hand, this reflects a positive tendency towards making deeper and longer-term investments, it can also limit a company’s ability to be responsive to new ideas. Companies with smaller amounts of funds pre-committed on a multi-year basis tended to be quite responsive to shorter term marketing and communications priorities as they develop from within the business.

A

TYPES OF GIVING

EMPLOYEE TIME DURING WORKING HOURS (DWH)

Despite the fact that 77% of LBG Canada companies encourage volunteering during working hours, less than 48% actually include the value of time volunteered. Those not including this information are consistently under-reporting the value of their investment in community.

This is most likely due to an absence of effective tracking systems. With new technologies being offered, it is expected that reporting on the value of employee volunteering during working hours will increase in 2012 and onwards.


Chart 11. How LBG Canada companies contribute

17%

2%

4%

75%

21%

1%

9%

68%

16%

1%

6%

77%

10%

0%

4%

86%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Program Management Costs

Time (during working hours)

In-kind

Cash

2010

2009

2008

2007

Chart 10. How LBG Canada companies contribute

10%0.2%

3.8%

86%

Program Management Costs - 10%

Time (during working hours) - 0.2%

In-kind - 4%

Cash - 86%

Four forms of investment into community were captured and valued by LBG Canada companies: cash, in-kind, time volunteered during working hours and program management costs. In 2010, the cash portion of investment remained the most significant portion of investment, averaging 86% of an LBG Canada company’s portfolio.

IN-KIND CONTRIBUTIONS

Generally speaking, companies are most effective in capturing and reporting cash contributions. In-kind and time values may require additional infrastructure or mechanisms to effectively track. While 100% of companies report their cash contributions, only 39% are reporting in-kind values, and 33% reporting the value of employees volunteering during working hours. Examples of in-kind investments included:

Computer equipment • such as PC, laptops, projectorsItems for auctions• T-shirts• Flight vouchers• Vehicles donations• Advertising space•

10%0.2%

3.8%

86%

Program Management Costs - 10%

Time (during working hours) - 0.2%

In-kind - 4%

Cash - 86%

17%

2%

4%

75%

21%

1%

9%

68%

16%

1%

6%

77%

10%

0%

4%

86%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%


Time (during working hours)

In-kind

Cash

2010

2009

2008

2007

GENERAL PROGRAM MANAGEMENT COSTS

On average, LBG Canada companies report 10% of their total contributions in the form of general program management costs. Across the LBG Canada community, these include:

Staff salaries & overhead• Communications & PR for department• Memberships & subscription fees• Consulting fees• Training & professional development• Travel• Event support •

Based upon total contributions, companies with smaller budgets had a proportionally larger amount of their giving designated as program management costs. This is likely due to smaller companies investing predominately into local communities and therefore are able to offer a more ‘hands-on’ approach to involving staff more often then those larger companies investing globally.

In line with 90% of LBG Canada companies increasing or maintaining their overall investment budgets, 21% of LBG Canada companies increased their staff allocation in 2010 while 64% held steady. This is likely due to smaller companies providing more direct support to larger local initiatives via team members that take a ‘hands-on’ approach. Smaller companies tend to have a higher staff/investment budget ratio. This is illustrated in Chart 13.

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20%

16%

4%

6%

1%

0%

0%

0%

1%

2%

12%

1%

66%

72%

69%

71%

0% 20% 40% 60% 80%

Under $1 million

$1 - $5 million

$5 - $10 million

Over $10 million

Cash

In Kind

Time


Chart 12. How LBG Canada companies contributed by size of community investment portfolio


Questions to be asked about types of giving and focus areas include:

Do we have right number of focus areas for our size of investment budget? • Are we seeking to distinguish ourselves from our peers? How?• Are we capturing all forms of investment (cash, in-kind, employee time (DWH), program • management costs)? If not, is the understatement of the value of our investment significant?

Chart 13. Changes in community investment team in 2010

21%

15%

64%

Increase 21%

Decrease 15%

No change 64%

CI Staff Changes

21%

15%

64%

Increase 21%

Decrease 15%

No change 64%

CI Staff Changes

Among community investment professionals, the opportunity to leverage external resources (ERL) is often overlooked, undervalued or misunderstood altogether. Within LBG Canada, all companies are encouraged to think through the possibility to leverage additional resources for the benefit of the community partner.

External resources leveraged refers to a community contribution that is stimulated by the corporate investor, yet is paid for by someone else. For example, ERL could be a cause-related marketing program, whereby a portion of the value of customer purchases is directed to a designated community partner.

Other examples of resources leveraged from external sources in 2010, and included in this benchmarking cycle are:

Employee giving through dollars for doers or • company organized eventsEmployee volunteer time (during non-working • hours)Customer giving via purchasing products that result • in a donation to charity (cause marketing)Matched funds from government (federal, • provincial, municipal)Event-based fundraising attracting broader • community participationFood bank or clothing donations gathered at an • eventMedia time offered by a partner or supplier• Products from suppliers•

Although only 27% of companies planned to leverage external resources (Chart 14), in actuality seventy-five percent (75%) of LBG Canada companies reported some form of external resources leveraged in the 2010 benchmarking results. The total cash value of ERL reported was almost $90 million while 24,000 people were motivated to volunteer and gave 238,689 volunteer hours. The $90 million reported as the value of external resources leveraged represents an additional $0.36 per $1 invested when considered across all companies benchmarked.

External Resources Leveraged


Opportunities for ReflectionQuestions to be asked about external resources leveraged include:

Are we trying to accomplish our community goals as a singular corporate investor, or will our • results be stronger if we can motivate others to participate? Have we explored all opportunities to partner with our stakeholders (i.e. employees, customers, • suppliers, regulators, business partners, neighbours, interest groups, governments, etc.)? Do we have a measurement system in place to track our progress against goals? And to value the • total contribution raised?

$0.25

$0.32

$0.36

$0.15 $0.20 $0.25 $0.30 $0.35 $0.40

2008

2009

2010

Chart 15. Leverage to contribution ratio (2008 - 2010)


27%

55%

12%

6%

Actively planning to leverage

Are somewhate planning to leverage

Not planning to leverage

Unsure how to do so

Chart 14. Companies actively planning to leverage external resources

27%

55%

12%

6%

Actively planning to leverage

Are somewhate planning to leverage

Not planning to leverage

Unsure how to do so

SECTOR BENCHMARKING

LBG Canada benchmarking enables companies to evaluate community

investment activities from a portfolio-wide perspective.

However, when LBG Canada has representation from three or more

organizations within an industry, sector benchmarking is possible. Sector

benchmarking allows companies to delve more deeply into community

investment challenges that result from the operating, regulatory and

product-related characteristics that are unique to their industry.

The following are excerpts from the individual sector reports, comparing

the four sectors in 2011: Canadian Banks, Credit Unions, Oil & Gas, and

Pipeline.

Achieving the Highest Standard in Community Investment.

www.simpactstrategies.comwww.lbg canada.ca

LBG Canada is facilitated by the SiMPACT Strategy Group | Email: [email protected] | Phone: +1 403 444 5683

67%

60%

100%

67%

59%

0% 20% 40% 60% 80% 100% 120%

Canadian Banks

Credit Unions

Oil & Gas

Pipelines

LBG Canada

0.4%

28.0%

16.4%

10.7%

26%

32.9%

47.6%

42.7%

64.1%

55%

2.3%

11.2%

6.7%

8.3%

19%

Canadian Banks

Credit Union

Oil & Gas

Pipeline

LBG Canada

Commercial Initiative

Social Investment


Motivation to invest by sector

$0.36

$0.28

$0.14

$0.19

$0.31

LBG Canada

Pipelines

Oil & Gas

Credit Union

Canadian Banks

Leverage to contribution ratio by sector During Working Hours volunteering offered by sector

The LBG Canada logo is an increasingly recognized symbol in Canadian corporate reporting. Use of the logo identifies companies as actively seeking to achieve the highest standard in community investment – for their community partners and for the business. This includes 1) a commitment to setting clear program objectives, 2) performance measurement of results, 3) ensuring all forms of investment are valued fairly and 4) reporting in a clear and transparent fashion.

As a result, more than 73% of companies plan to reference their involvement in LBG Canada in some form of public reporting in 2011.

LBG Canada companies often report externally on its community investment activities. Frequently used communication tools include both web-based and printed materials, and range from dedicated pages within corporate reports and websites, to initiative-specific printed materials, stakeholder-oriented newsletters and stories published by external media. For 55% of companies, external reporting includes publishing an annual Corporate Social Responsibility report and citing LBG Canada within the report.

External Reporting

REPORTING ON COMMUNITY INVESTMENT TO MULTIPLE STAKEHOLDERS

As a result of the comparability achieved through the LBG Canada benchmarking process, the information reported publically by LBG Canada companies is more easily interpreted and understood by reviewers of corporate information, such as JantziSustainalytics. For this reason, LBG Canada companies are increasingly citing the results of their benchmarked data across a variety of forms of external reporting.

One ever-present challenge to the community investment team is the need to report on community investment expenditure to a variety of evaluation frameworks and reporting standards. Not only is preparing each response time-consuming, companies face the added complications of multiple definitions of community investment


34%

34%

28%

25%

25%

25%

16%

16%

13%

0% 5% 10% 15% 20% 25% 30% 35% 40%

Global Reporting Initiative

Imagine Canada Caring Companies

Dow Jones Sustainability Index

Internal Audit Team

Corporate Knights

JantziSustainalytics Industry Surveys

Other

FTSE4Good

3rd Party Audit Team

Chart 17. CSR/sustainability questionnaires/surveys LBG Canada companies respond to

Chart 16. Companies planning on citing LBG Canada in public reporting

59%

70%

73%

0% 10% 20% 30% 40% 50% 60% 70% 80%

2008

2009

2010


and the need to interpret the parameters of each on a questionnaire by questionnaire basis.

LBG Canada assists companies to effectively manage multiple demands to report by offering a singular, comprehensive, clearly defined perspective on what constitutes community investment and how the breadth of a company’s activities should be valued.

For this reason, 73% of LBG Canada companies are using their benchmarked data to report to surveys and questionnaires such as the GRI, Imagine Canada, Dow Jones Sustainability Index and the Jantzi Social Index. The end result is time savings, more accurate reporting of information and increased overall credibility of the data reported.

Forty Percent (40%) of companies releasing a Community Investment or CSR Report are including a third party assurance statement from auditors such as PWC, Ernst & Young, or Deloitte. Some companies have expressed that the benchmarking process and recognition of the LBG Canada symbol by these auditors has made the process of achieving the assurance statement much faster and more efficient.


Questions to be asked about external reporting include:

How can we make our external reporting more compelling? • Are we focused on reporting investment amount or results achieved? How can our • involvement in LBG Canada help us to generate more information on results? Which stakeholders will be interested to know that we are involved in LBG Canada and why our • involvement is relevant to them? Are we using our LBG Canada data in every possible questionnaire/survey and reporting • opportunity?

16www.lbg-canada.ca

AFigure 5. Opportunities to use LBG Canada benchmarked data

23%

59%

18%

10%

60%

30%

15%

46%

39%

0% 10% 20% 30% 40% 50% 60% 70%

Undecided

No assurance statement

Assurance statement included

2010

2009

2008

Chart 18. CSR reports including an assrance

LBG Canada represents a wide-range of sectors, operating structures, geographic scopes and approaches to community investment. The SiMPACT Strategy Group’s line-by-line review of each participant’s community investment expenditure data and benchmarking process ‘normalizes’ the differences between investment style, form and size, such that all contributing companies can benefit from the management insight that results from the annual benchmarking exercise.

With 36 companies involved (33 companies at the time of benchmarking), the following pages provide an overview of the characteristics and details of companies within the LBG Canada community.

LBG CANADA COMPANIES BY INDUSTRY

LBG Canada companies are operating in twelve sectors across the country. Each of these industries is unique in their products/services offerings, the stakeholders surrounding their business and their business challenges. These differences influence each company’s goals and approach to community investment. The benchmarking process addresses the uniqueness of each sector, yet creates an opportunity for shared learning across sector boundaries and strategic approach.

Industries represented by more than three participants are able to benchmark as a sector. There are currently four sectors within LBG Canada. Sector benchmarking allows companies to delve more deeply into challenges that result from the operating, regulatory and product-related characteristics that are unique to their industry. (See page 14 for more details) LBG CANADA COMPANIES BY TOTAL COMMUNITY INVESTMENT BENCHMARKED

The size of community investment budgets benchmarked ranged from $100,000 to over $35 million. Clearly, the value of a high-impact and meaningful community investment program is as important to smaller companies as it is to the mid-size and the largest companies operating in Canada.

Since 2006, the total amount of community investment benchmarked by LBG Canada companies has grown from $28 Million to over $245 Million. The group itself has grown from 10 members in 2006 to 36 at present, 33 at the time of the 2011 benchmarking process. This is an encouraging trend indicating that a growing number of companies are actively seeking management systems that enable community investment to create demonstratable value, and are choosing to report the value of community investment with increased credibility and clarity.

Community Profile



Table 6. LBG Canada by total community investment benchmarked

LBG Companies by total community investment benchmarked # of companiesUnder $500 Thousand 2$500 Thousand - $1 Million 5$1 - $2.5 Million 6$2.5 - $5 Million 4$5 - $10 Million 7$10 - $50 Million 9


Table 5. LBG Canada companies by industry

LBG Canada companies by industry # of companies Energy 3

Canadian Banks 3

Credit Unions 10

Insurance 1

Manufacturing 1

Mining 1

Oil & Gas 5

Pharmaceutical 1

Pipelines 4

Retail 1

Telecommunications 1 Travel 1

LBG CANADA COMPANIES BY PRE-TAX PROFIT

Not every LBG Canada company reported a pre-tax profit figure for 2010, therefore the pool of data for this indicator is smaller than for other categories. Those that did not report pre-tax profit are subsidiaries of international corporations and do not report this information externally.

Contributions as a percentage of pre-tax profit ranged from 0.32% to 9.43%. Credit unions continue to have significantly higher percentage than other types of organizations.

LBG CANADA COMPANIES BY REVENUE

Annual revenue of companies participating in the 2010 benchmarking exercise ranged from $54 million to $34 billion.

Those that did not report revenue are subsidiaries of international corporations and do not report this information externally.

LBG CANADA FUNDING REQUESTS BY PORTFOLIO SIZE

Companies with a community investment portfolio of over $10 million saw significantly more requests as those that invest less than $1 million. The difficulty managing a large number of requests for funding is linked to size and national profile of each company. It also raises the question of whether communication on funding priorities and community investment boundaries can more clearly be communicated.

Table 7. LBG Canada by pre-tax profit

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Table 8. LBG Canada by revenue

LBG Canada companies by revenue # of companiesUnder $500 Million 12$500 million - $1 billlion 0$1 - $5 billion 5$5 - $10 billion 3$10 - $30 billion 5Over $30 billion 1Not Reported 7

Table 9. Funding requests

Size of CI portfolio Average # of requests Average approved requests Average % approved

Over $10 million 2213 1546 70%

$1 - $10 million 922 424 46%

Under $1 million 240 217 90%

LBG Canada companies by pre-tax profit # of companiesUnder $50 Million 7$50 - $200 Million 7$200 million - $1 billion 2$1 - $5 billion 8Over $5 Billion 1Not Reported 8

With over $245 million of corporate investment, more than 160 professionals engaged and 27, 728 transactions reviewed, the 2011 benchmarking cycle represents a period of significant growth for LBG Canada.

This growth demonstrates how corporations are embracing the concept of maximizing the performance of their community investment. As more companies use their LBG Canada data to evaluate the strengths of their contributions, they are also beginning to apply the LBG Canada approach to value new forms of investing.

TOP PRIORITIES

When asked about their top priorities for 2012, 94% of LBG Canada companies cited the development of strategies to leverage additional resources for community partners. This priority might be met by leveraging time and in-kind resources internally. It might also be achieved via leveraging resources from partners and suppliers or employees gifts of time and money. Regardless of form, a top priority for LBG Canada companies is ensuring key partnerships are well-supported on the path to meet their objectives.

As ever, measuring impact remains a clear priority for LBG Canada companies. As community investment is a two-sided coin, LBG Canada companies seek to measure both community and business benefits. The first step toward achieving this objective is for a company to identify motivation, as impact will always be measured in relation to the intent that led an investor to design a program or to decide to invest.

From the community impact perspective, there is an increasing interest within LBG Canada to explore the social return on investment(SROI) methodology. According to Chart 19, 41% of LBG Canada companies expressed interest in deepening their knowledge of SROI as a means to express the value of the change that occurs as a result of an investment. While the increased interest in valuing impact is exciting, establishing clear goals, output and outcome measures are essential to conduct an SROI.

As for every professional discipline, top priorities evolve as new challenges arise. As such, the needs of the growing network of community investment participants will continue to shape LBG Canada priorities.

Looking Forward



“The insights and evidence that result from LBG Canada participation enables us to make a clear business case about the importance of First Calgary Financial’s involvement in the community.”

Dani DeBoice, Director Corporte Citizenship First Calgary Financial

Chart 19. LBG Canada top priorities for 2012

41%

78%

84%

94%

0% 20% 40% 60% 80% 100%

Social Return on Investment

How achieving community benefit can create business value

Community impact - qualitative measurement

Strategies to leverage additional resources for community partners, from partners and

stakeholders

20www.lbg-canada.ca

AATOP CHALLENGES

Eighty-four percent of LBG Canada companies cited communication of the value of community investment as one of five top challenges. From an LBG Canada perspective, a difficulty in expressing the value of community investment often results from a lack of clarity about what community investment is and what it is not.

Companies that adopt the LBG Canada principles set boundaries around how community investment is defined. With clear definitions, all companies quickly find themselves able to communicate the value of results. They also find themselves better able to identify when an adjustment is required.

A second essential step is to be clear on motivation, as value can always be expressed in relation to intended results. The benefits of clear motivation are discussed above. When these two steps are taken, companies will also find that many of their top challenges will also be addressed, i.e. lack of clear expectations and no clear understanding of the value of community investment, in particular.

NEW OPPORTUNITIES

As the facilitator of LBG Canada, SiMPACT looks forward to continued growth, as growth will further enrich the management insights that come forward in the course of the benchmarking process.

As illustrated on page 2, companies join LBG Canada for different reasons. One that is more frequently cited is the increased credibility of reporting on community investment expenditure that results from LBG Canada involvement. This is the reason that 73% of companies include the logo in their annual and web-based reporting. This trend is only expected to increase as companies deepen their commitment to maximizing the value of community investment – for the community and for the business.

Chart 20. Top challenges for community investment professionals

53% 53%

59%

69%72%

84%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Lack of clear expectations from

senior team

Lack of systems and infrastructure

No clear internal understanding of

value

Too small a team Performance measurement too

time consuming

Communicating value internally and externally

Figure 6. FirstCalgary Financial Corporate Citizen Report & Website

Benchmarking – The use of defined standards to compare programs, processes and methods from which industry standards and best practice can be identified. Benchmarking allows for comparison and insights that organizations can use to evaluate themselves against their peers.

Motivations - Every voluntary community investment, regardless of size, form or theme, will always be driven by one of three motivations. In LBG Canada terms, these motivations are philanthropic investment, social investment and commercial initiative.

Philanthropic Investment - One-off or intermittent donations in response to charity appeals or in support of employee charitable activities.

Social Investment - Longer-term, strategic involvement in community partnerships that address a specific range of social issues that are important to the company or to company stakeholders. These programs are often aligned with long-term corporate interests.

Commercial Initiatives - Activities in the community that directly support a business objective, or promote or protect the commercial interest of the corporation. Examples include cause-related marketing, sponsorship of charitable events related to a business or marketing strategy, initiatives designed to spark recruitment, etc. Management Costs – Costs associated with running the community investment function or managing contributions to the community. Includes: The cost of community investment staff (including salaries and overhead), research, travel, as well as costs relating to the promotion of community programs.

Valuing staff time during working hours (DWH) – Volunteer time spent during working hours, for which the employee is paid. Is typically valued at the company’s average hourly rate (not including executive salaries). Local averages used by Statistics Canada may also be used as a proxy.

External Resources Leveraged (ERL) - Contributions to a community project that can be directly linked to a company’s involvement in the project, but are not a cost to the sponsoring company. For example: matched funds from government, input from a corporate partner, or employee time volunteered during non-working hours.

Staff time leverage outside of working hours and/or external volunteering (NWH) – Time spent volunteering during non-working hours is not given a cash value.

London Benchmarking Group (LBG) – Originally formed in the UK in 1994 and now used in nine international hubs, the London Benchmarking Group is a group of companies that use the LBG Model to assess and report on the value and achievements of their community involvement.

LBG Canada – LBG Canada is a growing group of companies committed to maximizing the value of their community investment – for community partners and for the business. Through their involvement, LBG Canada companies access the highest standard in community investment management, performance measurement and reporting.

Notes and Definitions




All LBG Canada companies agree to value their investments into community using a consistent set of valuation principles. This is a core element of involvement in LBG Canada. In order to be eligible within LBG Canada, an investment must uphold all of the following principles:

The contribution is voluntary (i.e. not regulated or part of daily operations); and1.

There is a clear community benefit to either the community at-large or to a community partner; and 2.

The contribution or benefit goes beyond the company’s customers, clients, suppliers, or employees; and3.

The contribution supports a not-for-profit or registered charitable organization, or contributes towards a 4. scholarship or bursary; and

The contribution is a “cost to the company” (inputs section within LBG Model). Contributions from 5. 5. employees, franchisees, suppliers, and external partners should be valued as “external resources leveraged;” and

The contribution has a demonstrable value to the communityin relation to cost contribution.6.

SIX CORE PRINCIPLES OF COMMUNITY INVESTMENT

FOCUS AREA DEFINITIONSAboriginal People - Contributions that support First Nations Groups and/or Indigenous, Aboriginal or Metis people.

Arts & Culture - Contributions that support the arts or promote local/community/ancestral culture or heritage.

Capacity Building - Contributions which help an organization build its capacity to fulfill its charitable purpose. Examples include: volunteer program development, research, evaluation methods, leadership development.

Children & Youth - Contributions that support family or children & youth under the age of eighteen.

Civic Leadership - Contributions which supports leadership in moving a social issue forward. Examples include: participation on a non-profit board, advocacy work, contributions to a grant-making organization, etc.

Diversity - Contributions which support the promotion of diversity within the community and/or support the empowerment of a disadvantaged population.

Education - Contributions which support any element of education for children, adults or the community at large.

Employee Programs - Contributions, gift-matching, or programs in support of company employee interests. It also includes costs associated with organized employee volunteer programs or activities.

Environment - Contributions that address an environmental issue.

Health & Wellness - Contributions that relate to health including disease prevention, health education, life-style & well-being programs, and contributions to hospitals, health research, etc.

Sport & Recreation - Community contributions which relate to sports and/or recreation.

Social Services - Contributions that support programs or social services which address basic needs such as housing, food, security, welfare, emergency services, etc. Organizations which more generally address poverty and social welfare issues, such as United Way, would also fit into this category.

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Acknowledgements

First and foremost, we would like to thank all of the 169 plus community investment professionals participating in LBG Canada. It is your commitment to setting a higher standard in community investment management, measurement and performance measurement that deepens the richness of LBG Canada benchmarking results every year.

Thank you to the companies who provided their insight and feedback into the Employee Giving & Volunteering Survey, as well as those who provided feedback throughout the survey process. Your active participation ensures that the results achieved through the LBG Canada benchmarking are meaningful and provide a clear picture of the various components of community investment program development.

And finally, to those within each LBG Canada company responsible for researching data, filling in the annual benchmarking survey and working with SiMPACT as we reviewed your data (27,000 + individual lines of data!) - thank you for your diligence in ensuring that the most accurate information was made available. This ensures LBG Canada benchmarking is truly comparable across sectors, company size and investment style, and that the data continues to represent a true reflection of community investment in Canada.




CONTRIBUTORS TO LBG CANADA BENCHMARKING

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* These companies invested in the creation of LBG Canada as founding members.

LBG Canada Companies 2010 2009 2008 2007 2006

Alliance Pipeline x

Alterna x Assiniboine Credit Union x

AstraZeneca Canada Inc. x ATB Financial x

BC Hydro x Chevron Canada Resources x x x CIBC x Coast Capital Savings x x x x Coastal Communities Credit Union x Enbridge Inc.* x x x x x Enbridge Pipeline x Enersource x ENMAX x x x x Envision Financial x x x x First Calgary Financial * x x x x x Foresters x x x x Gildan x Hydro-Québec x Interior Savings x x x x Nexen Inc. x x North Shore Credit Union x x Servus Credit Union x Shoppers Drug Mart x x x x Suncor Energy Inc. x x x Talisman Energy Inc. x TD Bank Group * x x x x x TELUS x Total E&P Canada x x x TransCanada Corporation * x x x x x Vale x x x Vancity x x WestJet x x x x

Victoria Newstead, Coordinator Community Investment

WestJet

“Going through the LBG Canada volunteering survey gave me a lot of perspective and food for thought. It helped me identify strategy and program management elements that I hadn’t considered before.”

Marlene MulliganCommunity Engagement Advisor

Chevron Canada

“Working through the LBG Canada 7-Step Approach with our community partners has helped us both gain a better up-front understanding about the objectives of the program and what is important to measure.”

“The insights and evidence that result from LBG Canada participation enables us to make a clear business case about the importance of First Calgary Savings’ involvement in the community.”

Dani DeBoice, ManagerCorporate Citizenship

First Calgary Savings

“The LGB Canada approach to community investment has enabled Interior Savings to institute a more streamlined process to make a funding decision and evaluate the success of an investment.”

Sonya Barker, Community Relations Coordinator

Interior Savings

“Every experience with LBG Canada and SiMPACT is better than the one before. The information is always valuable & timely, and I am so glad to be a part of this organization. LBG Canada provides incredible value to participants.”

Erin Satterthwaite, Director, Community Investment

Vale

SiMPACT Strategy GroupWeb: www.simpactstrategies.comEmail: [email protected]

Suite 306, 319 10 Avenue S.W.Calgary, Alberta, Canada T2R 0A5Phone: +1 (403) 444-5683

For more information about LBG Canada visit:www.lbg-canada.ca

Suite 168, 215 Spandina AvenueToronto, Ontario, Canada M5T 2C7Phone: +1 (416) 642-5461

2011 lbg canada annual benchmarking report

Documents