History of LBG

In 1994 six leading UK based international companies came together to form the London Benchmarking Group (LBG) to better manage, measure and understand corporate community involvement.

A company's foremost contribution to society is in providing goods and services and thereby creating wealth, generating jobs and paying taxes. Traditionally many have also made an additional voluntary, usually charitable, contribution.

As a company's relationship with the community becomes more complex, the motivations for involvement are more diverse. These include:

• A sense of moral responsibility, also responding to expectations from society
• A belief that companies have a long term interest in fostering a healthy community, sometimes known as enlightened self-interest
• The knowledge that community interventions involving employees, customers and suppliers can have direct benefits, through increased profitability, stronger company image, reduced costs, better employee morale and improved customer loyalty.

The original members used these three motivations as the basis to understand how each managed and measured its community involvement programs.

Since then, the LBG UK membership has grown to 123 companies in the UK, with groups being established internationally ( Australia & New Zealand with 37* member companies, Canada, Czech Republic, France, Germany, Spain and the USA amongst others) and many more applying the techniques independently.

All members recognise that companies are expected to be involved in the community and are often judged on the amount they contribute. This involvement often goes beyond straightforward donations to charity - and if a comprehensive account is not produced, key groups such as employees, local communities, opinion leaders and the media might easily form the wrong impression.

The challenge facing the founding members of the LBG was how to effectively report their community activities to demonstrate that they are indeed responsible corporate citizens.

Effective reporting is best based on solid measures of performance, but in the 'soft' area of social reporting hard measures are still in their infancy.

Their solution was to devise a tool with which to manage, measure and compare their investment in the community and developed the LBG methology.

* As at 25-Aug-08