Measuring the Performance of your Community Investment Portfolio

(3BLMedia/theCSRfeed) June 8, 2010 - 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.

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 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 the first sidebar image. Each definition is directly linked to expectations for investor involvement and measureable business and community benefits, across timeframes.

Benefits associated with community investment are often perceived as too intangible to be measured. This perspective limits expectation of the portfolio and dimished its perceived value. Imagine the internal reaction when the portfolio is represented as offering measurable business and community benefits in the short, medium and long term. 

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, 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.

Clarity on overall portfolio results brings forward opportunities to strengthen key projects in order to to deepen their value from both a business and community perspective.  Once the overall portfolio has been assesssed, LBG Canada companies use a seven-step approach to outline, investigate and maximize priority projects (see second image).  This is the value of performance measurement - using the portfolio view and the project specific view to align both expectations and results to achieve maximium possible benefit for the community and the business.   

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