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more than making money measuring the difference your company makes to society RESEARCH PARTNERS: CORPORATE PARTNERS: BT Diageo John Lewis Partnership KPMG RWEnpower Serco Group Severn Trent Vodafone

More Than Making Money

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Companies use a wide variety of techniques and approaches to assess the difference they make to society. This research project looks at the ‘why and the how’ of measuring impact on society. Key findings were that good measurement is proportionate to the goals of the activity being measured and should lead to better management; no single methodology exists to assess the difference companies make to society.

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Page 1: More Than Making Money

more than making moneymeasuring the difference your company makes to society

R E S E A R C H P A R T N E R S :

C O R P O R A T E P A R T N E R S :

BTDiageoJohn Lewis PartnershipKPMG

RWEnpowerSerco GroupSevern TrentVodafone

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principles of measurement

Companies use a wide variety oftechniques and approaches to

assess the difference they make to wider society. This contribution

comes most directly from their corecommercial activities and the

economic impacts they generate. Itcan be enhanced by the way

companies choose to do businessand by the voluntary initiatives andprojects they undertake or support.

Measurement should provide thehard evidence to support the

internal ‘business case’ forcorporate responsibility. Externally,

the credibility of corporate claims isenhanced by adopting a transparent,

consistent and principles-basedapproach to measurement.

So this study has developed a set of‘Dos and Don’ts’, intended toprovide companies with the

underlying principles to help guideany assessment, whatever

measurement method is adopted.

do...Do be clear about your goals before youstart measuring. This will fundamentally affect the methodyou chose. Measurement is all about knowingif you are achieving your objectives.

Do identify who is going to use the results,and how. Design the process to best meet the differingneeds of your various stakeholders.

Do give your stakeholders a voice in the process. Capture their views through qualitative aswell as quantitative measures. Numbersalone are rarely enough.

Do use a robust methodology and ensureyou have concrete evidence to back upyour findings. Avoid anecdote. Only extrapolate from asingle initiative to a ‘whole company’conclusion when there is a reliable andcredible sampling basis.

Do distinguish between inputs, outputsand impacts, and between measures ofprocess and of results. Decide which to measure and what tool to use according to the objectives you have set.

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don’t...Don’t think measurement alone willimprove results.Assessment must be integrated intomanagement processes and the results used to inform decisions that will make a difference over time.

Don’t over-engineer the process.Simple measures may not capture the fullcomplexity but are more likely to be applied,the findings understood and the conclusionsacted upon.

Don’t always go it alone. Consider involving expert third parties for greater credibility. Use recognisedtechniques so the results can be more easily benchmarked.

Don’t communicate positive aspects only. Measurement needs to be objective andbalanced in order to strengthen credibility.

Don’t think you have to measure everything.Consider the time and effort against theusability of likely results. Often the process of clarifying goals and identifying performancemeasures helps to focus activity and achieves better results even without actualmeasurement. Be willing to say ‘no’ tomeasuring for the sake of it.

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The practical dos and don’ts – from project assessment to whole company impacts

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measuring the difference – an overview

Companies affect society through their day to dayactivities and in the choices they make about how theyrun their businesses. The focus on corporateresponsibility over the last two decades has shown thatmaking a positive difference is not only compatible withprofitability, it can be vital to long term commercialsuccess. As a result companies are under increasingpressure to manage, measure and report moreeffectively the range of contributions and thedifference they make to society.

This study is not for those seeking the Holy Grail of theultimate social impact measurement tool. Instead thecorporate partners set a different objective – to showhow and when to use existing tools from the manycurrently available.

What is clear is that the choice of what to measure andwhat technique to use depends on both the goals of theactivity being measured AND the reasons formeasuring. This was strongly confirmed by thestakeholder consultation we undertook.

The main outcomes from the study are:a set of principles to apply to whatever and howeveryou are trying to measure;a map of the different types of contribution to societyand a toolkit of measurement techniques for eachone; anda data bank of real life case studies showing howcompanies have used different measurementtechniques.

The aim is to help managers understand the differencethey can make to society and to choose when, how andwhat to measure.

Hasn’t it all been done before?Our starting point was to map the wide array ofstandards, guidelines and frameworks used to assesscorporate responsibility. Examples include Business inthe Community’s Corporate Responsibility Index, theLondon Benchmarking Group (LBG), the GlobalReporting Initiative and Dow Jones SustainabilityIndices*.

Existing approaches tend to focus on internal processessuch as policy commitments and management systems.Few provide, or require, objective measurement ofactual results achieved, though some are starting toaward higher ratings to companies that do conductsuch assessments. So the focus of this study is howcompanies can measure the difference they make – or the results achieved – and is designed to workalongside existing external standards.

Who is this study for?This study – written by and for companies – aims tohelp any manager trying to make sense of apparentlyconfusing and conflicting measurement demands. Themotivation for measuring will vary: for some it is aboutbetter management (of both the business and ofcommunity projects); for others it is about buildingtrust with stakeholders, or supporting their licence tooperate. The focus of this study is on the externaldifference companies make to wider society although itrecognises that the internal benefits to the companiesthemselves are equally valid and important.

For everyone, we hope this simple guide will help you to better understand and assess your company’scontribution to society.

more than making money measuring the difference your company makes to society 03

Three key findings1. Good measurement is ‘proportionate’ – linked to

the goals of the activity being assessed, focusedon identifying results than can actually be used,and balanced so as to provide an objective view

2. No single methodology exists to assesscorporate contribution to society – butcompanies should follow a common set ofprinciples in their assessment, identify the type of contribution they are making, and then choosean appropriate tool

3. Measurement should lead to bettermanagement – so the type of assessment(whether long term impacts or more immediateoutputs, whether qualitative or quantitative)should be selected to achieve that goal

*The online library accompanying this report has more information and links to the 40 initiatives we identified. See www.bitc.org.uk/measurement or www.corporate-citizenship.co.uk/measurement

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04 more than making money measuring the difference your company makes to society

the measurement map – trends, approach, terminologyThe measurement journey

Current practice among individual companies is verydiverse and the growing number of external standardshas not led to a uniform approach. Each company isrightly deciding on its own needs for internalmanagement and external reporting, and devising itsown ‘measurement journey’. Nonetheless it is possibleto discern four broad trends or ‘dimensions’ in theoverall approaches to assessing contribution to society.(See Fig 1).

Some companies started by focusing on more effectivemanagement of their corporate communitycontributions and projects. As understanding ofcorporate social responsibility has developed, manyhave added assessment and reporting in other ‘impact’areas, including marketplace issues, workplace and theenvironment.

One:Community projectassessment

Two:Corporate policies

Community projectassessment

Three:Economic impacts

Corporate policies

Community projectassessment

Four:Core products and services

Economic impacts

Corporate policies

Community projectassessment

Four dimensions in the measurement journey

However, such corporate responsibility reporting hasnot ended the debate about the role of business insociety. In fact, issues such as inequalities in theglobal economy are raising more fundamentalquestions about the economic impacts of companies.Companies are increasingly examining their economiccontribution, overall, to individual stakeholders and atcountry level.

Finally, consultation conducted for this study amonginvestors and others stressed that, looking forward,companies should be able to demonstrate thecontribution to society made through their coreproducts and services, and not simply take that as read. At present there are surprisingly few goodmeasurement accounts of the difference made toquality of life and long-term sustainable development of,for example, reliable mobile telephony, secure bankingservices, safe food retailing or dependable utilities.

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We strongly endorse the wholeconcept of measurement to informthe decisions we make to maximisethe 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.”Robert Smith, Serco Group

Companies have social impact just by existing. No single measure of

that impact exists. It all depends onwho you are and where you are sitting.

Companies that map their impacts and manage their interface with

stakeholders are more likely toenhance shareholder value.”Investment fund manager, during stakeholder consultation

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more than making money measuring the difference your company makes to society 05

Mapping the type of contributionThese four dimensions are not a linear journey everycompany should follow. On the contrary, companiesshould apply whichever measurement tool is appropriate,according to their own needs. Sometimes this will be asimple project assessment at one site; at other times, itwill need to be an assessment of world-wide economicimpact. Identifying where the assessment sits in theoverall ‘map’ of contributions companies make shouldequip managers to use their chosen tool with confidence.

This ‘map’ of contribution to society is best described at three levels (see Fig 2) and a good starting point isestablishing where what you want to measure lieswithin this.

First, what are our core impacts?Companies’ biggest impacts come through their coreactivities – the products and services they produce andsell. After all, that’s why they exist as organisations.Measuring these impacts isn’t easy as it dependscrucially on the nature of the product or service. A good way to visualise the contribution here is toimagine how the world would be different if yourindustry did not exist.Second, what are our economic impacts?Companies generate flows of money through theirbuying and selling activities: day-to-day income comes in from customers and money goes out to employeesand suppliers, with tax payments to governments anddividends to investors. These flows of money have directeconomic impacts, which in turn have indirect ormultiplier economic impacts along the value chain, asemployees, suppliers and governments spend themoney they have received. The impacts can be at macroeconomy-wide levels or in specific locations or amongdifferent groups.Thinking about economic impacts should featurestrongly in any consideration of overall impacts,especially as it is through economic activities thatcompanies make their social and environmental impacts.

Third, what wider impacts can we achieve by the waywe choose to run the business?Companies can choose to do business in a certain way, forexample, to help educate consumers, set labour standardsfor suppliers, provide employees with training beyond theessential job requirements, fund a community project oroff-set their environmental impacts. Such activities are atthe heart of corporate social responsibility. They yieldpositive benefits for society and can contribute to longterm business success.

Defining termsInputs All the elements which a company devotes to a project, initiative or activity, including money,employee time and in-kind resources such asequipment or product.

Leverage The additional resources that otherscontribute to the project initiative or activity as a direct result of the primary funder’s input.

Outputs The direct and immediate activity andresults achieved by deploying ‘input’ resources.These may be quantifiable, such as the number of people helped or number of events held, orqualitative including changes in attitude.

Impacts The fundamental difference that a project,initiative or activity makes over time. These shouldencompass all the long term outcomes caused by theactivity, both positive and negative, and excluderesults that would have happened anyway. (This studyhas focused on ‘external’ impacts in society, but theimpact on the business itself is a key component, withits own measurement tools.)

Multiplier effects In economics, the multiplier effectoccurs when one change in spending affects totaleconomic activity, as employment increases andwages are spent and more activity results.

Corporate responsibility policies and

projects*

Economic impacts: Direct and indirect

Core products and services

Mapping the difference companiesmake to society

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2

*Making a difference to consumers, customers, suppliers, employees, the environment, communities and governments through the way the business is run.

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06 more than making money measuring the difference your company makes to society

measurementtoolkit To show the difference that a company’s core product or service makes to the

people who use itTo calculate the economic impact of the business as a whole or of an operationwithin it, at country or international level or among certain stakeholder groups

CORE PRODUCTS AND SERVICES ECONOMIC IMPACTS

Companies are using many varied ways toassess the difference their activities maketo society. Here we present the maintechniques we believe to be the mostpractical and relevant, with references tomore detailed case studies that follow onlater pages. Also available as a separatedownload is a detailed listing of over 50other examples.This can be accessed fromwww.bitc.org.uk/measurement orwww.corporate-citizenship.co.uk/measurement

Purp

ose

No standard methodology as the types of product/service and the needs ofconsumers vary widely

Start by mapping type of products/services available, volumes sold and marketshare. Next describe typical consumer use showing the practical benefits. Nextfocus on use within specific consumer groups, such as under-served markets

Available measures include data on product take-up among different consumergroups, indicators of affordability/accessibility, a calculation of the economicvalue created, and consumer surveys/feedback

Direct impacts:mapping of paymentsmade to suppliers,employees,governments,communities and others,showing amounts andshare of value added

Multiplier effect(including indirect andinduced impacts):econometric modellingshows how a firm’slinkages to the economyresult in a ‘ripple effect’

Value chain analysis:tracking the sequence ofeconomic activity fromraw material throughproduction anddistribution to final sale

Mea

sure

men

t to

ols

avai

labl

eProvide context e.g. historic trends in product take-up, pricing data and market share

Include qualitative assessment of consumers/other stakeholders views

To see how people’s lives would be different without access to the product or service

To show how ‘valueadded’ is shared amongstakeholders

Commissioningeconometric studiesprovides thorough andauthoritative findings,but can be expensive

Relevant for firms withextensive supply anddistribution chains

Gather together dataabout direct financialrelationships with keystakeholders

Use research anddialogue to understandthe nature of thesegroups and relationshipsin detail

Adding the subjectiveviews of stakeholdersaffected can provide afuller picture

Map from ‘field to fork’to show how value andemployment aredistributed

Need to go beyond basicmapping to understandthe nature of stakeholderrelationships at eachstage

How

to a

pply

Whe

n to

ap

ply

Vodafone (see page 8) Diageo (see page 8) BT (see page 8) Unilever Indonesia(see page 9)

Case

stu

dyex

ampl

e

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more than making money measuring the difference your company makes to society 07

The further out a companygoes from its own initiatives,the harder it is to measure.Their contributions tocommunity projects are agood start, but their longer-term impacts are moredifficult…

It’s the same with economicimpacts: immediate flows ofmoney are easy to track, butwhat about the ripple affectacross the global economy…

What we need companies tofocus on are their mid-levelimpacts, the things they canreally influence: do go beyondsimple contributions but don’tget lost in total ‘theoretical’impacts – figure out whatdifference you can make…”Community and governmentrepresentatives during stakeholderconsultation event

Suitable for a broad range of initiatives e.g. special help for vulnerable socialgroups, supply chain codes of conduct and health and safety policies

Can provide a snapshot of costs andbenefits

Allows managers to judge effectiveuse of resources

A powerful tool suitable for a limitedrange of projects – project outputs must have a quantifiable effect onfinancial flows e. g. tax and wageeffects of decreased homelessness or increased employment

How to applyW

hen toapply

To show the effect when a company deliberately modifies its policies orpractices relating to marketplace, workplace, environmental and communityissues

To assess the contribution made by an individual project or initiative, often inpartnership with a community organisation

CORPORATE POLICIES PROJECT ASSESSMENT

Broad range of quantitative and qualitative measures depending on the issue,increasingly reported through CSR reports

Examples of measures include:

Marketplace: customer complaints about products and services; customersatisfaction levels

Workplace: value of training and development provided; staff absenteeism andturnover; employee surveys

Environment: overall energy consumption; water usage; solid waste producedby weight; CO2/greenhouse gas emissions

Community: value of company contributions; extent of employee involvement;number of beneficiaries assisted

Resource and results assessment:depending on the initiative, use avariety of quantitative and qualitativemeasures within an input/outputframework such as LBG e.g. cost of thecontribution, number of peoplebenefiting and opinions about ultimateeffectiveness

Social return on investment:a specific tool to monetise costs andbenefits arising from projects with asocial purpose e.g. funding for atraining scheme to get unemployedpeople into work will save socialsecurity costs and generate taxrevenue

In addition to numerical measures, qualitative measures e.g. a description of stakeholder views are often the best way to capture real-life results of an initiative

Important to include a balanced assessment, not just focus on positive aspects

Identify the inputs, immediate outputsand longer term impacts

Be clear about objectives of project atthe outset

Can provide ‘before and after’assessment if baseline data isavailable

Start by assessing number of peoplebenefiting

Use basic assumptions about financialeffect e.g. average increase in taxpayments

Waitrose (see page 9) Serco Group (see page 10) KPMG and others (see page 10)

PurposeM

easurement

tools availableCase study

example

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case studiesPRODUCTS & SERVICESTool: Evaluating impact of product or serviceCase study: Vodafone research – impact of mobiletelephony in AfricaWhy it measuredVodafone commissioned a study to look at the socialand economic dimensions of mobile phone use in Africain order to understand actual usage rather thanextrapolate models of usage from the developed world.Its aim was to increase the evidence base for regulatorypolicy and business strategy development. What and how it measuredThe research reviews the evidence and precedents forsocial and economic change linked to mobile phone usein other regions. It then surveys mobile phone users toestablish patterns of usage in African economies. Thestudy shows links between mobile phone take-up andeconomic growth rates with higher growth between1996 and 2003 in countries with 10+ mobile phonesper 100 people. It also shows unique characteristics ofusage, such as sharing of phones amongst widernetworks of people, not just individuals and socialbenefits e.g. improved relationships with families andfriends were cited by around 80% of people in Tanzaniaand South Africa.From principles to practice • Greater credibility by involving third parties via

Advisory Panel.• Focused on understanding one region well rather than

trying to assess global activity.Further details: www.vodafone.com

ECONOMIC IMPACTSTool: Direct impacts (economic impact)Case study: DiageoWhy it measuredIn its corporate citizenship reports, alcohol beveragecompany Diageo aims to inform readers about thedirect economic impacts of its operations. While thecompany produces the branded products itself, othersbenefit from its total value chain. These includegovernments, who have long sought to raiseconsiderable tax revenues from alcohol sales, and retailers through shops and bars who add their margin before final consumer purchase.What and how it measuredDiageo provides basic factual information about theflows of money into and out of the company among itsstakeholders. Pie charts and flow diagrams show theamounts spent with suppliers and the flows of ‘addedvalue’ to those with a stake in the process –governments are the largest beneficiary, followed byinvestors and then employees. In its 2004 report,Diageo also shows how retailer margins andgovernment tax-take vary between its differentproducts – Bell’s whisky, Smirnoff vodka, Blossom Hillwine and Guinness beer.From principles to practice• Provide factual data as many stakeholders are ill-

informed about basic economic fundamentals.• Add to understanding by showing geographic or

product break-downs.Further details: www.diageo.com

Tool: Multiplier effect (economic impact)Case study: BT Better World Report 2005, DTZ Pieda analysisWhy it measuredBT’s social and environmental report looks at the direct, indirect and induced economic impacts of thecompany’s activities. It also looks at the Information,Communication and Technology (ICT) sector’scontribution to growth and productivity, in the contextof the EU Lisbon Strategy and other EU strategies onsustainable development both of which will govern theframework for BT’s (and the ICT sector’s) futurebusiness growth and development. What and how it measuredBT mapped its direct economic impact and itsdistribution to key stakeholder groups. It alsocommissioned DTZ Pieda to look at the indirecteconomic impacts it creates a) via BT’s expenditure inthe economies it operates in and b) through its sale of ICT goods and services which stimulate economicgrowth and productivity. Additional indirect (or induced)impact is created when income created by BT is spentencouraging further employment. BT’s estimatedinduced impacts produce £3.4bn of income and supportnearly 174,000 jobs. From principles to practice• Clearly distinguished between inputs, outputs and

impacts – as well as direct vs indirect effects.• Uses recognised economic analysis techniques by

a third party to give greater credibility to indirectimpacts.

Further details: www.bt.com/betterworld

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case studiesADDITIONAL EXAMPLES INCLUDE:Core products and services• Barclays: basic bank accounts

The Barclays Cashcard account offers people on lowincomes access to a bank account. Evaluation is usedto identify ways of refining the product.

• BT: broadband – the role for communications inbeating congestionThis study examines the role of broadbandcommunications in substituting telecommunicationsfor journeys by car in the UK.

Economic impacts• Visa: electronic payments and economic growth

This study looks at the impact of electronic cardpayments on the economy – the effect of the card payments industry on growth, spending and employment.

• Wal-Mart: the economic impact in AmericaThis study looks at the economic and employmenteffects of the entry and expansion of Wal-Mart in the US.

Corporate policies• London Underground: stress reduction

Monitoring of a new stress reduction programmeshowed a reduction in absence, cost savings of£455,000 and evidence of improved productivity and company culture.

• Xstrata Coal: HIV/Aids programme in South AfricaIn 2004 Xstrata implemented an HIV/Aids programme.Evaluation in 2005 showed the number of employeesknowing their status had risen from 78% to 89%.

For further details of these case studies, see online libary:www.bitc.org.uk/measurementwww.corporate-citizenship.co.uk/measurement

more than making money measuring the difference your company makes to society 09

Tool: Value chain analysis (economic impact)Case study: Unilever/Oxfam exploration of the links between international business and povertyreduction in IndonesiaWhy it measuredUnilever Indonesia and Oxfam undertook joint researchto explore the effect of Unilever’s operations – bothpositive and negative – on poverty. The findings showUnilever Indonesia has a large indirect economic effect.While the company employs 5,000 people directly,300,000 people find employment in its value chain –from farming to the retail system.What and how it measuredThe research aimed to track the income andemployment generated through the making and sellingof Unilever products (the value chain), focusing onKecap Bango, a brand of soy sauce. It maps theemployment and income generated by the farming,transportation and processing of products as well asthe distribution and sales channels. Surveys, interviewsand company data are used to establish the peopleemployed at each stage and the links between them.Despite practical difficulties in implementation, thestudy identified appropriate measures and used arecognised tool.From principles to practice• Clear measurement goals – to understand better the

socio-economic effect of an international business onpoverty.

• Appropriate measures (the flow of jobs and money)and a recognised tool (value chain analysis).

• Greater credibility by partnering with an expert thirdparty (Oxfam).

Further details: www.oxfam.org.ukwww.unilever.comwww.ilo.org/dyn/empent/docs/F204969253/VCA_book_final.pdf

CORPORATE POLICIES

Tool: Evaluation of policy decisionsCase study: Waitrose Responsible Sourcing and the Waitrose FoundationWhy it measuredWaitrose's Responsible Sourcing programme aims toimprove supplier workplace conditions and increase thesustainability of its supply base. Driven in part bygrowing consumer interest, it reports performance inits CSR Report and communicates activity via productand in store information, customer magazines, TVadvertising and appropriate national campaigns e.g.Fairtrade Fortnight.What and how it measuredThe Responsible Sourcing Code of Practice outlines itsexpectations of suppliers. Assessment and auditingidentifies priority supplier sites and areas of non-compliance, which Waitrose works with suppliers toaddress. Since 2002 the percentage of supplier sitesidentified as ‘high priority’ has steadily reduced. Theprogramme has also led to focused work on specificissues like Gangmaster licensing. In addition, it recentlyestablished the Waitrose Foundation, which ensures aproportion of the profits from its fruit sales directlybenefit farmers in South Africa. In its first year theFoundation funded 25 initiatives at 10 farms whichaddress locally identified needs, supporting over 5,000 workers.From principles to practice• Stakeholders and users of results identified, with

information tailored to each audience.• Management and measurement processes form part

of the Responsible Sourcing programme.Further details: www.waitrose.comwww.johnlewispartnership.com

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10 more than making money measuring the difference your company makes to society

case studiesPROJECT ASSESSMENT

Tool: Community investment project evaluationCase study: Serco Group HMP KilmarnockWhy it measuredDrug misuse is a major concern in Scotland, with highrates of drug-related deaths among prisoners afterrelease. Recognising this, the Serco Home Affairs teamat HMP Kilmarnock set up a Drug Death Action Group,introduced care plans for prisoners with known drugproblems and partnered with a local charity to supportprisoners’ families to reduce the upward trend in drug-related deaths. Measuring enabled Serco and theirpartners to evaluate the success of the initiatives.Running a newly built, privately run, prison, Serco were also keen to demonstrate their commitment tothe local community.What and how it measuredManagement data and data from partners were used totrack outcomes for individual prisoners. In 2002, sevenprisoners died within 13 days of being released due todrug overdoses, with none recorded in 2003 and 2004after the new measures were brought in. In addition,the NHS funded two addiction nurse posts. Assessingthe benefits to prisoners enabled Serco to demonstratethe success of this investment and justify continuedfunding when the initial NHS funding ended. From principles to practice:• Identified who would use results and communicated

success to local community via membership of localforums/groups.

• Measurement was only one aspect of improvingoutcomes and results were used to informmanagement decisions.

Further details:www.serco.com

Tool: Social Return on Investment – community investment project evaluationCase study: Business Action on HomelessnessWhy it measuredBusiness Action on Homelessness (BAOH) is apartnership between homelessness agencies, theGovernment and businesses (Marks & Spencer,Barclays, KPMG and others). BAOH aims to helphomeless people find employment and achieveindependent living. Measurement supports the businesscase and is used to demonstrate to government thatthe philosophy of the programme – putting homelesspeople into work – is fiscally sound. What and how it measuredThe programme measures four things: has it put peopleinto work/enhanced their employability (questionnairesto clients); what are the business benefits/changes toHR policy (internal management data); how does itcompare to government programmes like New Deal forsimilar client groups; and what is the return oninvestment? In the latter case, the current cost to thegovernment of supporting a homeless person isapproximately £30,000. The saving per person gainedvia the programme is £26,846 taking into account thecost of the programme and additional tax receipts.From principles to practice: • Clear measurement goals – to justify investment in

programme and support ongoing business/agencyparticipation.

• Uses different methods appropriate to measurementneeds and goals.

Further details: www.bitc.org.uk

ADDITIONAL EXAMPLES INCLUDE:Project assessment• RWEnpower/Macmillan

RWEnpower and Macmillan have been working inpartnership since 2004 with the aim of raising moneyand awareness of Macmillan’s services to help peopleaffected by cancer.

• Severn Trent: Be SmartBe Smart audits school water use, promotes waterconservation, the benefits of drinking water and agreater understanding of water issues. Has beenshown to lead to greater water efficiency in schoolsand longer-term costs savings.

Social Return on Investment (SROI)• Diageo: Tomorrow’s People

10 years after it began, an evaluation of Tomorrow’sPeople showed that by helping more than 380,000people out of long-term unemployment, it saved theUK economy around £450m through benefitspayments saved, additional tax receipts, reduction in health expenditure and reduction in crime.

• Cadbury Schweppes: WaterAid partnershipA partnership aimed at improving access to safe waterin Ghana. Evaluation has shown measurable impactsinclude freeing up time for work and a reduction inhealth costs.

For further details of these case studies, see online libary:www.bitc.org.uk/measurementwww.corporate-citizenship.co.uk/measurement

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more than making money measuring the difference your company makes to society 11

further informationResearch methodologyThis project was initiated by Serco Group and Businessin the Community in Autumn 2005. The project wasmanaged jointly by Business in the Community and TheCorporate Citizenship Company and involved eightcorporate partners – BT, Diageo, John LewisPartnership, KPMG, RWEnpower, Serco Group,SevernTrent and Vodafone.The project initially undertook an in-depth review ofcurrent practice. This involved desk research looking atthe numerous tools and methods used by companies tomeasure, benchmark and report corporateresponsibility policies, practices and impacts. The fulllisting and review can be downloaded from the project’sonline library (see box right).This led us to identify a number of case studies whichprovide clearer guidance for companies in how othershave used different methodologies – from the LondonBenchmarking Group (LBG) approach through toeconomic modelling – to assess their contribution tosociety. The full listing of case studies can be accessedat the project’s online library (see box right).In April 2006, two stakeholder consultation sessionswere conducted, involving over 20 experienced NGOs,investors, government agencies and corporateresponsibility experts. For a full listing of those involvedand a summary of the discussions, please go to theproject’s online library (see box right). This invaluableexercise allowed us to ensure that the project and theclarity and guidance it aimed to achieve would build oncurrent thinking and practice, and would be of use notonly to company managers but to a wider audience.The project team do not view this report as the end ofthe project. Planned workshops following publicationwill further debate on the issue of impact measurementamong stakeholders and provide greater clarity tocompanies.

Online project library: extra resourcesavailable to download

Listing of benchmarks, standards and guidelinesAdditional case studiesList of further case study measurement examples,classified by typeSummary of the stakeholder consultation

The online project library can be accessed at:www.bitc.org.uk/measurement www.corporate-citizenship.co.uk/measurement

Key resources for further information and adviceCore products and services• No key resources were identified by this study, so

the research partners intend to collect examples ofgood practice as companies apply the methodologyrecommended here

Economic impacts• DTI value added scorecard

www.innovation.gov.uk/value_added/• Value chain analysis for policy-makers and

practitionerswww.ilo.org/dyn/empent/docs/F204969253/VCA_book_final.pdf

Corporate policies• Business in the Community: Indicators that count

www.bitc.org.uk/resources/publications/indicators.html

• Global Reporting Initiative www.globalreporting.org

Project assessment• London Benchmarking Group www.lbg-online.net• Roberts Enterprise Development Fund publications

on SROI www.redf.org/publications-sroi.htm

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R E S E A R C H P A R T N E R S :

C O R P O R A T E P A R T N E R S :

Cottons Centre, Ground Floor SouthLondon Bridge City, London SE1 2QGT +44 (0)20 7940 5610F +44 (0)20 7940 5619E [email protected]

137 Shepherdess WalkLondon N1 7RQT +44 (0)870 600 2482F +44 (0)20 7253 1877E [email protected]

Copyright © 2006 Business in the Community and The Corporate Citizenship CompanyISBN 1 902270 040 5

Designed and printed by SCS Marketing. Printed on Revive Silk, containing 75% de-inked post-consumer waste and 25% mill broke. Product code 01COM000300October 2006.

SummaryA study of practical ways in which companies can assess the differencethey make to society, from individual projects to whole company impacts,with good practice principles, a contribution ‘map’, a toolkit of practicalmeasures, case study examples, tips from practitioners and a guide toterminology.

Goal of projectThe overall aim of the project was to look at the concept and practicalities ofmeasuring impact on society, by assessing the perceived drivers for measurementand conducting a review of current practice, in order to shape the debate aroundmeasurement and bring some practical guidance to a wider audience.