1. Corporate Social Responsibility:
Components, ROI and Measurement
Selected Slides for SXSW Eco Panel Picker
May 2013

2. 2 © 2010-2013 Community Matters Group
Strategic Corporate Social Responsibility is the art of
making responsibility profitable and making
profitability responsible.
1
CSR
101
2
Why
Measure
3
Nuts &
Bolts
4
Key
Challenges
5
Building
Excellence
Agenda

3. 3 © 2010-2013 Community Matters Group
Corporate Social
Responsibility
Strategy
Environmental
Sustainability
Money,
Resources &
Time
Ethics &
Transparency
People
(internal)
Leveraging
Relationships
Business
Practices
1 Corporate Social Responsibility Components

4. 4 © 2010-2013 Community Matters Group
Corporate Social
Responsibility
Strategy
Business
Practices
Environmental
Sustainability
Money,
Resources &
Time
Ethics &
Transparency
People
(internal)
Leveraging
Relationships
1 CSR Component: Environmental Sustainability
Carbon
Footprint
GHG
Emissions
Waste Water
Pollution Energy
Customers’
Impact
Supply/Value-
chain’s Impact

5. 5 © 2010-2013 Community Matters Group
Corporate Social
Responsibility
Strategy
Leveraging
Relationships
Business
Practices
Environmental
Sustainability
Money,
Resources &
Time
Ethics &
Transparency
People
(internal)
1 CSR Component: Business Practices
Loan Portfolio Deposit
Portfolio
CRA Values-based
Products
This is about the impact of core
operations, products and services and
as such, varies greatly by business.
For a bank this could include to whom
and how they lend, where they locate
branches, whether they help unbanked
populations or are predatory, if they
support green building, etc.

6. 6 © 2010-2013 Community Matters Group
Corporate Social
Responsibility
Strategy
People
(internal)
Leverages
Relationships
Business
Practices
Environmental
Responsibility
Money,
Resources &
Time
Ethics &
Transparency
1 CSR Component: Leverages Relationships
B2C
Customers
B2B
Customers
Suppliers Vendors
Sphere of
Influence
Competitors
Leading
Collaborations
Inspiring
Others

7. 7 © 2010-2013 Community Matters Group
Corporate Social
Responsibility
Strategy
Ethics &
Transparency
People
(internal)
Leverages
Relationships
Business
Practices
Environmental
Responsibility
Money,
Resources &
Time
1 CSR Component: People (internal)
Fair Pay &
Benefits
Work-Life
Balance
Development &
Advancement
Diversity &
Inclusion
Employee Health
& Safety
Supporting
Volunteerism
Employee
Assistance
Training

8. 8 © 2010-2013 Community Matters Group
Corporate Social
Responsibility
Strategy
Money,
Resources &
Time
Ethics &
Transparency
People
(internal)
Leverages
Relationships
Business
Practices
Environmental
Responsibility
1 CSR Component: Ethics & Transparency
Business
Ethics
Governance
Reporting Social
& Environmental
Impact
Human Rights
Responsible
Investing
Advocacy

9. 9 © 2010-2013 Community Matters Group
Corporate Social
Responsibility
Strategy
Environmental
Sustainability
Money,
Resources &
Time
Ethics &
Transparency
People
(internal)
Leveraging
Relationships
Business
Practices
1 CSR Component: Money, Resources & Time
Strategic
Philanthropy
Non-$
Resources
Grassroots
Volunteering
Skills-based
Volunteering
Cause
Marketing
Strategic
Spend
Sponsorships In-kind Giving

10. 10 © 2010-2013 Community Matters Group
Measurement is the first step that leads to control and eventually to improvement. If you
can't measure something, you can't understand it. If you can't understand it, you can't
control it. If you can't control it, you can't improve it.
—H. James Harrington, performance improvement thought leader
1
CSR
101
2
Why
Measure
3
Nuts &
Bolts
4
Key
Challenges
5
Building
Excellence

11. 11 © 2010-2013 Community Matters Group
Measurement underlies two
key processes:
Prove
 To stakeholders
 To the market
 To customers
 To influencers
 To employees
 Sharpen discussion
 Enable experimentation
 Support tools
 Link to continuous improvement
Im
2 Why Measure? Prove & Improve

12. 12 © 2010-2013 Community Matters Group
2 Why Measure? More Details
• Measuring inputs and outputs to confirm that you and
your partners are doing what has been agreed upon
Confirmation
• To assess the impact of your investments and learn
lessons critical to improving your effectiveness, you
need measures of what has actually changed in
addition to inputs/outputs
Improvement
• Internally and externally, people believe that you
measure what you value and you value what you
measure―especially in a performance-based culture
Credibility
• The act of measurement can be worthy of note, as can
the stories that emerge from the evaluative process
Publicity

13. 13 © 2010-2013 Community Matters Group
2 Why Measure? Generating External ROI
• Based on existing research, current best practices and
fresh creative thinking, identify a “Theory of Change”
How Can We
Move the
Needle?
• Test the “Theory of Change.” Did the strategic actions
achieve the desired results?
Is This ―Theory
of Change‖
Correct?
• How much was achieved? Is there a way to improve
effectiveness?
How Much Did
We Move the
Needle?
• This process will help prove and improve the change
generated
External ROI

14. 14 © 2010-2013 Community Matters Group
2 Why Measure? Generating Internal ROI
• Dupont has saved nearly $5B since 1990 through
efficiency improvements. Over a recent two year period,
average annual internal rate of return was 75%.
Efficiencies &
Cost Reductions
• Clorox Greenworks cleaning supplies: Sales of $60M+
in 2010 (while that is a drop from 2008‟s peak, attributed
to the recession, it is still significant).
New Products &
Services
• By developing ways to add shared value with „bottom of
the pyramid‟ consumers, Unilever projects 50% of its
revenue ($20B+/yr) in developing countries.
New Markets
• There is growing research that customers are more
likely to patronize companies and brands that they see
as being responsible.
Increased Sales
• The CISCO Networking Academies initiative has solved
a key restrictor to CISCO‟s growth―lack of qualified
workers to administer their networks.
Overcoming
Challenges

15. 15 © 2010-2013 Community Matters Group
2 Why Measure? Generating Other Internal ROI
• A key „intangible asset,‟ brand can be heavily influenced
by CSR excellence, or lack thereof (eg, BCCCC State of
Corporate Citizenship Report).
Brand/Image/
Reputation
• CSR can help measurably improve morale, recruitment,
retention, productivity, and leadership (eg, Hill &
Knowlton Study).
Talent
• CSR can create great value by improving relationships
with key influencers (eg, Northeast Utilities reduced
approval times by engaging local politicians in CSR).
Key Influencers
• CSR can help improve exposure to regulation, lawsuits,
competition, materials access, supply chain disruption,
customer retention (eg, Panasonic lead-free TV).
Risk Reduction
• Failure at just one aspect of CSR can impact a
company‟s license to operate (eg, Enron; WaMu).
License to
Operate

16. 16 © 2010-2013 Community Matters Group
Indicators (or benchmarks) are measures which help quantify the achievement of a
result. They answer the question "How would we recognize these results in measurable
terms if we fell over them?" So, for example, the rate of low-birthweight babies helps
quantify whether we're getting healthy births or not. Third grade reading scores help
quantify whether children are succeeding in school today, and whether they were ready
for school three years ago. The crime rate helps quantify whether we are living in safe
communities, etc.
—Karen Finn, Partner, Results Leadership Group
1
CSR
101
2
Why
Measure
3
Nuts &
Bolts
4
Key
Challenges
5
Building
Excellence

17. 17 © 2010-2013 Community Matters Group
3 Theory of Change
Activities
Expected
ResultsTheory of Change
―Theory of Change‖ =
―If we do this, we expect
to get that result.‖

18. 18 © 2010-2013 Community Matters Group
3 Measurement Drives Strategy
3 Design strategies to achieve desired results
6 Adjust and continuously improve
2 Develop ―Theory of Change‖
5 Measure and evaluate the impact
1 Identify desired results
4 Invest and test ―Theory of Change‖
Some measure what they already do and
try to capture their activities and impacts.
But to really drive change, you need to:

19. 19 © 2010-2013 Community Matters Group
3 Types of Measures: Broadly Speaking
• Eg, $50K donated to an afterschool college/career
preparedness program
• Eg, 100 employees volunteered 1 hour a week for 9
months as academic coaches
Inputs
(things you do)
• Eg, $50K enabled afterschool program to engage 100
additional students in a college/career preparedness
program for 2 hours/day, 3 days/week for 9 months
• Eg, 900 hours of academic coaching
Outputs
(what is done
with the
resources)
• Eg, participants showed a 30% improvement in overall
grades (vs a 2% improvement for nonparticipants)
• Eg, 30% increase in morale indicators and 20%
increase in retention rates for employee volunteers
Outcomes
(what has
changed,
impacts)

20. 20 © 2010-2013 Community Matters Group
3 Types of Measures: Yet Another Way To Look At It
• “What are we doing?”Activity
• “How well are we doing it?”Quality
• “What has changed as a result?”Change

21. 21 © 2010-2013 Community Matters Group
3 Types of Measures: More Specifically
• Eg, inputs, outputs, direct outcomes like number of
participants getting into college, dollars saved, etc.
Direct Measures
• Eg, there is no “employee morale thermometer” to
measure morale, but there are causally related
measures like timeliness, attrition and sick days
Proxy Measures
• Proxy measures alone can be imperfect. Individually,
timeliness, attrition and sick days don‟t measure morale,
but they have different “noise patterns” and triangulating
them can create a good indicator of morale
Triangulated
Measures
• There can be deep persuasive power in anecdotes.
Individual stories of the impact on people, communities,
departments, etc. can be incredibly potent
Anecdotal
Measures

22. 22 © 2010-2013 Community Matters Group
3 Techniques for Gathering & Analyzing Data
• Sampling: Identify representative sub groups and use
data gathering techniques (eg, observation or surveys)
to glean data that can be applied to the whole group
• Census: Collect data from an entire population
Sampling &
Census
• Identify an existing “longitudinal divergence” in the
population that you can use as a natural experiment
―or―design an intentional experiment, comparing a
well-matched control group and experimental group
Experiments
• Often, relevant data is already being collected (eg,
annual employee surveys, a nonprofit‟s own research
on their impact, data collected by government agencies
and advocacy groups, etc.)
Found Data
• Regression
• Bayesian Statistics
• Difference in Differences Analysis, etc.
Statistical
Analysis

23. 23 © 2010-2013 Community Matters Group
―That’s the beautiful thing about data – it can either back up your instincts or prove
them totally wrong.‖
—Susan Wojcicki, Senior Vice President Marketing, Google
1
CSR
101
2
Why
Measure
3
Nuts &
Bolts
4
Key
Challenges
5
Building
Excellence

24. 24 © 2010-2013 Community Matters Group
4 Key Measurement Challenges & How to Overcome
• Many nonprofits lack the expertise and capacity to
measure impact, and often face demands for varying
metrics from multiple funders
• Many companies have limited budget for measurement
Capacity/
Resources
• It appears difficult to measure the value of less tangible
variables (eg, morale), but it is possible
• Not measuring gives them the only value that we
absolutely know they can„t have: zero
Intangibility
• Eg, decisions on having more efficient data centers that
only look at the power cost reductions miss most of the
benefit (75% of the ROI is from rent/space savings)
• Unknown relationships (eg, tree coverage reduces crime)
Hidden Value
• Standardization
• Systems Integration
• Establishing & Refining
New Metrics
Overcoming
These
Measurement
Challenges
• Triangulation
• Data Excavation
• Uncovering Hidden Value
• Investment & Training

25. 25 © 2010-2013 Community Matters Group
4 Key Measurement Challenges & How to Overcome
• It can be challenging to attribute specific impact
• It can be difficult to demonstrate direct causality
Attributing
Impact &
Causality
• Many larger challenges (eg, persistent poverty) are
complex and are influenced by a wide set of factors (eg,
education, transportation, job availability, etc.) and
actors (government, foundations, nonprofits, etc.)
Complexity of
Challenges
• Too often, those asked to measure are not involved in
designing the measurement and evaluation plan
Lack of Buy In
• Make larger investments
• Utilize proxy measures
• Acknowledge uncertainty
Overcoming
These
Measurement
Challenges
• Find discrete indicators
• Engage all stakeholders
• Fund measurement

26. 26 © 2010-2013 Community Matters Group
Have we done what we set out to do? If we’re working with a nonprofit, and they say
―we’ll train 20,000 individuals and take 5,000 into jobs‖, then we want to know whether
you’ve hit that metric... (Beyond that) what is happening that you did not imagine would
happen, both positive and negative, so that you can then mitigate that or enhance it in
the next round of funding or support?
—Akhtar Badshah, Senior Director for Global Community Affairs, Microsoft Corporation
1
CSR
101
2
Why
Measure
3
Nuts &
Bolts
4
Key
Challenges
5
Building
Excellence

27. 27 © 2010-2013 Community Matters Group
5 Building Excellence: Key Scoping Questions
• Why do you want to measure and evaluate your efforts?
Confirmation? Improvement? Credibility? Publicity?
What do you want to see in return?
Why
• What do you want to measure and evaluate? Outputs
and inputs? External impact? Internal ROI? Overall
impact and/or impact of specific initiatives?.
What
• What depth of measurement do you want to engage in
for each of these?
Depth
• How much money/time do you want to invest in
measurement/evaluation?
Investment

28. 28 © 2010-2013 Community Matters Group
5 Building Excellence: Key Scoping Questions
• What are other similar companies doing vis-à-vis
measurement? Do you want to lead or follow?
Competitive
Benchmarking
• What is the capacity of your partners to help you
measure your activity and impact?
Partner
Capacity
• What are you already measuring? Where can you find
existing measures (found data)? What is your current
baseline?
Existing
Measures
• For all your existing data (and any new measures you
decide to create), how good are the ABCDEs?
Availability; Believability; Coverage (broad enough?);
Depth (can you drill down far enough?); Execution
ABCDEs

29. 29 © 2010-2013 Community Matters Group
5 Building Excellence: Key Steps for Success
• Based on the answers to the previous scoping
questions, build into the next strategic plan
comprehensive measures and evaluation aligned with
the plan‟s specific goals and targets
Building
a Plan
• Start by measuring inputs and outputs
• If desired, measure external impact and internal ROI
• Evaluate the success of your efforts against goals
Measuring &
Evaluating
• Use measurement and evaluation to inform strategy
adjustments and continuous improvements
• Report and communicate your results transparently
Continuous
Improvement &
Reporting
• Robust measurement and evaluation that drives ROI
(internal & external), supports continuous improvement
and helps capture compelling stories
End Game

30. 30 © 2010-2013 Community Matters Group
CMG Contact

31. 31 © 2010-2013 Community Matters Group
CMG Core Competencies
CSR Strategy &
Implementation
Strategic
Planning to
Drive External
Impact &
Internal ROI
Rigorous
Measurement of
External Impact
& Internal ROI
Internal &
External
Stakeholder
Engagement
Communication
with External
Stakeholders,
Employees, &
Executives
Implementation
(eg, Flagship
Partnership
Management)
Creative
Solutions to
CSR Challenges
Measurement
Strategy
Engaging
Stakeholders
Measuring
Outputs &
Outcomes
Developing
Measures
External ROI
Measurement
Internal ROI
Measurement
Direct, Proxy,
& Anecdotal
Measures
Sampling,
Census, &
Experiments
Data
Excavation &
Triangulation
Statistical
Analysis