Professional Documents
Culture Documents
Measure For Measure: Celebrating The LBG's First Ten Years
Measure For Measure: Celebrating The LBG's First Ten Years
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Six founding members: British Airways Northern Rock
BP BSkyB Pearson
Diageo BT Pfizer UK
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IBM BUPA PricewaterhouseCoopers
Marks & Spencer Cable & Wireless Procter & Gamble UK
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NatWest Group Cadbury Schweppes Prudential
Whitbread Camelot Reed Elsevier
5 Centrica Rio Tinto
Members who joined the founders to Cheshire Building Society Rolls-Royce
pilot LBG’s ‘second generation’: CMS Cameron McKenna Royal Mail
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American Express Co-operative Financial Services Royal & SunAlliance
BT The Co-operative Group The Royal Bank of Scotland
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Camelot Credit Suisse First Boston RWE npower
Centrica Deloitte & Touche SABMiller
8 Levi Strauss Deutsche Bank J Sainsbury
Nationwide Building Society Diageo Scottish Power
9 News International Dresdner Kleinwort Wasserstein Scottish & Newcastle
Railtrack EDF Energy Severn Trent
10 Rio Tinto EMI Group Shell International
SmithKline Beecham E. ON UK (Powergen) Standard Life
Unilever Ernst & Young Tesco
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United Utilities ExxonMobil Thames Water
and CAF as co-sponsor Friends Provident UBS
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Freshfields Bruckhaus Deringer Unilever
LBG members who continue to FSA United Utilities
13 develop the model:
GlaxoSmithKline UnumProvident
Abbey
HBOS Vodafone
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Allied Domecq
Herbert Smith Whitbread
Altria Group
HSBC Woolworths
Anglo American
15 John Lewis Partnership Yell
AOL UK
Kellogg’s Zurich Financial Services
BAA
16 KPMG
Bank of England
Linklaters & Alliance
Barclays
Lloyds TSB
17 BAT
Marks & Spencer
BBC
Marsh
18 BG Group
McDonald’s
BNFL
mmO2
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The Body Shop
Morgan Stanley
Boots Group
National Grid Transco
BP
20 Nestlé UK
Bradford & Bingley
NFU Mutual as at December 2004
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Foreword: Geoffrey Bush 1 ideas of six UK companies, working together to 1
Chair of the LBG develop a standard for measuring, benchmarking
and reporting their community programmes, to a
Foreword: Directors of The Corporate 2 robust and comprehensive model, used by
Citizenship Company
hundreds of businesses around the world.
Why measure? 3 Our watchword so far has been steady, sustained
ALISON GULLIFORD
growth and rigorous testing of the model, to ensure
CCI in short: a brief history of 6 it works for companies of any size, from any sector
corporate community involvement and in any country. Its users confirm that it helps
DAVID LOGAN them learn from each other, plan more strategically
and report accurately and credibly.
LBG milestones 8
As a founding member of the LBG, I am pleased to
How we’ve done 10 be able to share in the celebration of ten years of
the LBG’s growth and achievement. Above all, I want
LBG: the strategy now 12
to recognise the valuable contribution made by
LBG model in brief 15 nearly 100 LBG members in ensuring the model
drives innovation and improvement in corporate
What membership involves 19 community involvement, and stays relevant and
Where do we go from here? 20 responsive to the needs of companies and
MIKE TUFFREY
communities. It is their work that makes the
LBG work.
Contacts 21
Our goal for the next ten years must be to ensure
Companies using the LBG model 21 that the LBG model fulfils its potential as the global
standard for measuring and reporting corporate
community involvement, cementing companies’
important role in communities and wider society.
Foreword
FROM DAVID LOGAN JERRY MARSTON MIKE TUFFREY DIRECTORS OF
THE CORPORATE CITIZENSHIP COMPANY
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page
It has been a great privilege for us to have We believe the LBG model is therefore of great
1
worked with so many talented and committed interest to a much wider range of stakeholders, who
managers in the companies of the LBG over the want to understand and evaluate how companies
2 past ten years. From the start, members have manage and report their social impacts.
been keen to answer three practical
When each of us started our professional careers in
3 management questions, which are as crucial
this field, we knew at heart that corporate
now as then:
citizenship was much more than community
4
How are companies actually contributing to the involvement. The recent burgeoning of interest in
community, at the centre and out in the field? CSR has confirmed that beyond doubt. Equally, we
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remain as convinced now as we were then, that
Are we doing the right things, and doing them well? effective, measured and benchmarked CCI is the
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Above all, are we achieving what we set out to do, cornerstone for many companies’ approaches to their
and more besides? wider responsibilities.
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LBG members have worked together to develop a We hope that this tenth anniversary report will show
8 robust, easy-to-use model that allows them to to a new audience, as well as to some old hands,
benchmark their programmes and so help to answer the continuing value of the work our great
9 these questions. Their goal has been better companies do in their communities.
performance, both for their community investments
10 and for themselves as individuals, wanting their
companies to see the benefits that flow from a
11 professionally managed community strategy.
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impressions when deciding what to do next. 3
The UK Parliament established a £20,000 prize
fund, eventually won by clockmaker John Harrison. MEASUREMENT HELPS US MAKE BETTER
Harrison proposed using a highly accurate clock DECISIONS BY TELLING US WHAT WORKS
which could keep time at sea, allowing sailors to AND WHAT DOESN’T.
calculate the time-difference from a central point.
Using the accurate time and the position of the
stars, they were able to calculate their exact “I want to do the right
position.
3
thing right.”
Philadelphia, Rome and Lisbon were all used as The film ‘Chariots of Fire’ charts the rise of Harold
reference points, but as the volume of sea traffic Abrahams, the 100-metres gold medallist in the
increased it became vital to have a single accepted 1924 Olympics. In a field dominated by gifted
standard for navigation. This role was filled by amateurs, Abrahams turned to a professional coach,
Greenwich Mean Time, making London the centre of Sam Mussabini, to improve on his natural talent.
the system of internationally-agreed time zones used Through rigorous training, backed up by
to this day. measurement and critical assessment, he achieved
small, incremental improvements in his
COMMON STANDARDS HELP US GET performance. By the day of the race, he knew
OUR BEARINGS. exactly what he had to do to win. At the time, his
efforts won him notoriety. Now, his rigorous methods
and critical self-examination are common practice
“I want to make sure for any serious athlete.
2
Grainy film footage shows the Tacoma Narrows A commitment to finding out what happened
Bridge in the USA writhing and buckling like a toy in is what matters.
high winds. At the time of its design, engineers were
ignorant of the risks that certain extreme weather MEASUREMENT HELPS CHECK WE ACHIEVED
conditions could create, on a terrifying scale, the WHAT WE MEANT TO, AND DOESN’T HAVE TO
effect which high-divers employ when jumping from BE COMPLICATED.
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a diving board into water. In July 1940 high winds
page
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It is not possible or necessary to measure
everything for all projects.
“I want to check it worked
8
out as planned.” By choosing an approach we already know
5
contribution.”
19
The closure and sale of school sports grounds across
the UK looks set to become another example of a
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benefit lost because no-one had taken stock of what
they actually achieved. Six thousand fields were sold
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Physical exercise will play a critical role in keeping People will naturally take steps to improve their
the UK’s population from becoming steadily more performance in whatever is being measured.
obese, yet the opportunity to establish good patterns
early on is now diminished. Think about the effects of the measures you use.
Don’t be put in the position of having to Ensure the process is constructive and does
more good than harm.
close a good project because you couldn’t
justify the investment.
BECAUSE MEASUREMENT PROMOTES CHANGE,
IT MATTERS WHAT MEASURES YOU USE.
MEASUREMENT HELPS ENSURE THE BEST
WORK SURVIVES.
“I don’t want to be
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studies conducted at the Western Electric Hawthorne the 1930s, as investors lost confidence that their
Works in Chicago between 1927 and 1932 by money was being used honestly. The great variety of
Harvard Business School professor, Elton Mayo. accounting practices between countries made
Mayo was examining the relationship between standardisation an uphill task, and for some years
working conditions and productivity. Work hours, the future of a common standard was uncertain.
rest breaks, temperature and lighting were each However the sheer advantages of speaking a
changed in turn for a group of workers. However common language ultimately proved enough to give
over time, Mayo found that it didn’t actually matter momentum to a worldwide set of standards, which
what factors he changed: they all resulted in are taking shape under the supervision of the
increased performance. He concluded that the act of International Accounting Standards Committee from
measuring can itself affect performance. The workers 1973. Common standards take time to catch on,
he was studying reacted to the fact they were being but become the norm.
studied by working harder and better.
COMMON STANDARDS TEND TO BECOME
When people know you're measuring THE NORM.
something, they try to make the measurement
turn out right.
So simply observing how things are working Every one of these principles is true for the
actually improves human endeavour. It’s a fact.
field of corporate community involvement.
MEASUREMENT CAN IMPROVE PERFORMANCE. Companies that agree use the LBG.
I’m going.”
During the 1980s, the UK government introduced
efficiency targets for the National Health Service.
A key measure chosen was hospital bed occupancy
– how many beds were occupied on a census night.
It was later argued that clinical managers, keen to
demonstrate that all beds were occupied, had started
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LBG TENTH ANNIVERSARY REPORT
Is CCI a new invention? left little room for companies to get involved in
2
solving society’s problems. Indeed for much of the
Far from it – corporate giving has its roots in the
next 30 years there was active hostility to
19th century when businesses first became
businesses sponsoring social projects or having a say
3 incorporated. Many LBG members can trace their
in education. Then along came Margaret Thatcher
community involvement to Victorian philanthropists.
and the general sense that she came to represent
4 Jesse Boot, for instance, established Nottingham
that things needed to change.
University from the proceeds of his chemist shops,
5 while William Lever built a model community for
workers of what was to become Unilever. What did Margaret Thatcher do for CCI?
6 She led an ideological assault on the welfare state -
But surely modern community involvement taking on the unions and reasserting the role of
7 private enterprise. Business was set free to make
is different from that?
profits as never before, but in the widespread
8 Correct - the key difference is that decision making restructurings and layoffs of the 1980s, expectations
is no longer down to one business leader. Many of businesses and their role in the community had
9
early industrialists had the freedom to do as they once again radically changed. Older companies were
wished with their company profits. As a broader able to reconnect with their roots as pioneering
group of shareholders took ownership of publicly corporate citizens, while newer and recently
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traded companies, they wanted to see how all privatised businesses were quick to see the
expenditures benefited the business. With this the advantages of engaging with pressing community
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early days of grand scale corporate philanthropy and social issues. This enlightened self-interest
came to an end. marked the start of modern CCI.
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those contributions to the community and to the 7
Better management information to guide
business. Finally, the model supports reporting of
future strategy
‘mandatory contributions’ to the community, made
by companies as part of regulatory requirements, Shift the debate from costs of the CCI
and leverage, where company contributions unlock programme to benefits
additional funds for charitable causes. Capture and value key areas of contribution
e.g. employee time and in-kind
The LBG model is completely compatible with other
contributions
management tools for CCI and is used by many
Enable companies to compare like-with-like,
companies to improve their response to the
using standard definitions and valuations
requirements of external standards such as the GRI
and queries from socially responsible investors. In Improve external reporting
the UK, further examples include BiTC’s Corporate
Responsibility Index and public reports such as the
PerCent Club, the Guardian’s Giving List and The
Sunday Times Companies That Count.
LBG milestones
LBG TENTH ANNIVERSARY REPORT
1994 2000
0
six companies start work to develop and test a LBG membership opened up to all companies
page
2001
2
1997 launch of the LBG in Australia as the Australia
publication of findings, the basic principles of Benchmarking Group, working with the
3
the LBG model in, ‘Companies in Communities: National Centre for Citizenship (NCC) and
Getting the measure’ ARTD Management and Research
4
5
LBG’s second generation 2002
test, refine and issue definitive guidelines launch of LBG in the USA as The Corporate
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Giving Standard, working with The Committee
to Encourage Corporate Philanthropy
7
1997
8 twelve more companies join the pilot group 2003
LBG model tested in new sectors, such as
9 1997-2000 higher education
eighteen companies test and refine the model
10
with support from David Logan, Mike Tuffrey
and the Charities Aid Foundation (CAF)
2003
11 mandatory contributions added to reporting model
1999
12
15
2000 2004
publication of guidelines for measuring what membership approaches 100 in the UK
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a community programme achieves in ‘Companies
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in Communities: assessing the impact’ 2004
LBG is launched in France as the Group Français
18 de Référence, working with Cap Juby
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2004
20 three groups formed to pilot more intensive
output measurement
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BRUCE LEARNER COMMUNITY AFFAIRS
MANAGER, KELLOGG’S
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100
80
members
0 60
page
1 40
20
2
Canada
3 1994 1998 2000 2001 2002 2003 2004
5
1000
7 600
Guatemala
Honduras Argentina
400 Mexico Bolivia
8 Nicaragua Brazil
Panama Chile
200 Colombia
9 Ecuador
Paraguay
2000 2001 2002 2003 2004 Peru
10 Uruguay
Venezuela
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Improving the depth of data capture and reporting Key developments in 2004
2001-2004
12
60
13 55 Total number of input/output Total leverage reported
50 case studies reported (£ million)
45
number of members
14 40
35 106 190
30
15
25 Members reporting Value of mandatory
20 mandatory contributions contributions (£ million)
15
16
10
5 010 038
17
2001 2002 2003 2004
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Ascension Island
New Zealand
Falkland Islands
Companies are responding to changing social continually bring questions and issues to the group.
attitudes by publishing more rigorous data about This process of answering questions, surveying other
their social performance. As consumers become members’ practices and collectively agreeing policy
more demanding and better informed, employees is building a growing body of ‘case law’ – specific
more ethically engaged, and a whole range of guidance on how to interpret the model for different
other stakeholders more determined to hold issues and sectors. This work is ongoing and being
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them to account, companies are publishing developed primarily through groups representing
page
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new business opportunities. The challenge is to put
a credible monetary value on these benefits. This JOE FRANSES
will enable CCI practitioners to define the return to GROUP CSR MANAGER,
CABLE & WIRELESS
the business for every pound spent, and enhance
their positioning as a benefit rather than a cost to
the business. An LBG ‘cost-benefit’ working group is
taking this forward.
as lower unemployment benefits and increased tax prospective partner companies. The LBG
1
revenues. LBG is now working with nef (New model enabled them to demonstrate what
Economics Foundation) in the UK to trial this they were achieving and to communicate that
2
methodology among LBG members. clearly and concisely.”
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Intermittent support to a wide range of good causes in response to the needs and
Charitable appeals of charitable and community organisations, increasingly through
gifts partnerships between the company, its employees, customers and suppliers.
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Activities in the community, usually by commercial departments,
Commercial initiatives in to support directly the success of the company, promoting its
the community corporate brand identities and other policies, in partnership with
charities and community-based organisations.
1 The fifth category, business basics, includes all core a comprehensive assessment of
business activities involved in delivering products our work with a range of community
2 and services which are critical to business, but not stakeholders.
motivated by community benefit. The manner in
feedback and input from across
3 which these activities are managed has a significant
the business.
social and environmental impact and is often
4
reported alongside CCI in company reports, but is an informed strategy to involve teams
outside the measurement scope of the LBG model. across the business.
5 data to inform programme planning
In-kind
ALISON BRAYBROOKS
11 COMMUNITY
Management costs
INVESTMENT
STRATEGY MANAGER,
12 Typically members also analyse their ‘input’ EDF ENERGY
contributions by subject or theme and by the
13 geographic location of beneficiaries.
14
Assessing outputs and impacts
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In addition, the model goes further by assessing society and the business, where relevant. This is the
what the company’s programmes actually achieve – final element of the LBG model. It involves revisiting
the ‘outputs’ defined in terms of: the goal of the programme and asking what has
16
actually changed as a result. New approaches such
Leverage of cash and other resources unlocked as social return on investment (SROI) provide a
17 by the company’s contribution sound approach to quantifying a programme’s long-
term benefits to society. These and other specific
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Community benefit, such as the number of
measurement techniques complement and enhance
people who benefit
the LBG model.
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Business benefits, such as publicity achieved
The example on page 18 illustrates how the LBG
20 Beyond such immediate outputs, strategic planning input output matrix is used to gather data on a
of CCI programmes involves assessing the impact on CCI programme.
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Education
RACHEL CLARKE
and youth
31.4% COMMUNITY RELATIONS,
ROLLS-ROYCE
development 17
50.6% 1.5%
Environment
13.2%
Other 3.3%
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Case study: KPMG’s Ready for Work Programme
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Programme objectives: The main aim of this programme is to get ex-homeless people back into full time,
sustainable employment in partnership with Barclays, Marks & Spencer and Marsh. All figures unless stated
9 are a proportion of the overall total, reflecting the KPMG contribution.
10
Inputs over two years (2002-4) Annual outputs
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Community impact Business impact
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15-20 specialist industry sector subgroup If you are interested in joining the LBG,
meetings each year on specific measurement please contact Sue Parsons or any member
issues of the LBG team at The Corporate
Citizenship Company on 020 7940 5610 or
Access to the members-only section of the LBG
email: mail@corporate-citizenship.co.uk
website, for advice on implementing the model
www.lbg-online.net
Use of the LBG logo and the right to cite
membership in external publications
page
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LBG TENTH ANNIVERSARY REPORT
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The LBG is one of the unsung success stories about – benchmarking meaningfully in sector,
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of the UK’s evolving corporate community measuring outputs from the whole programme
1
involvement scene, as I believe this tenth budget not just flagships, and moving to assess long
anniversary report shows. However, this remains term impacts from major investments. Even after a
2 work in progress, not job well done. decade, LBG members cannot rest on their laurels.
3
Yes, CCI professionals now have the tools to manage Third, we urgently need a wider effort to educate
their programmes effectively and efficiently. But people outside companies about the true
understanding about the real value and contribution contribution that the corporate sector makes. Say it
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of community programmes is still not strong. quietly but it’s unfortunately a fact: long-serving
Internally, the annual budget round remains a Chancellor and prime minister-in-waiting, Gordon
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fraught process for most. Externally, the general Brown, is wrong, on one point at least. Speaking at
public thinks companies contribute much more than the NCVO annual conference in February 2000, he
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they actually do, while the media confuse said “In the USA, around 1 per cent of company
contributions with social responsibility. Key opinion profits are given to charity. But in Britain it is only
7
leaders, such as senior government ministers, are 0.2 per cent of company profits.” He went on to say
not much better informed either. “It is time for a new start here too….. we want
8 Britain to start a new chapter in corporate giving.”
So, looking forward, we need to keep on working.
9
Here’s a three-part call to arms. LBG members know they contribute significantly
more. Business as a whole – small firms, unlisted
First, in the face of the (very welcome) growing companies, international subsidiaries – do too, and
10
interest in corporate social responsibility, we need to could show it if they measured it. And of course,
reassert strongly the value of community LBG would say that the message could be infinitely
11 contributions and of the community as a distinct stronger if we made the case in terms of results
stakeholder. If the battle a decade ago was to move achieved, not just a fraction of profits donated.
12 the debate on contributions from corporate
philanthropy to community investment, now there is The prize available to us all, if we rise to meet this
13 a new front to defend – the distinction between CCI call to arms, is huge. Our communities will be
and CSR. And many community programmes don’t stronger and better resourced. Our companies will
14 do themselves any favours: they may be relevant to be more sustainable and increasingly successful.
a company long term – financial literacy in schools And the UK will be well placed to lead the world in
15 by banks, for example. But are they really a new understanding of the role of companies in
addressing core social issues of pressing concern to communities.
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stakeholders now, as CSR urges us to –
Today, at the end of the LBG’s first decade, the
unprecedented levels of personal indebtedness
global village feels a smaller and more fragile place
among those banks’ customers, for example?
17 than in the early nineties, when optimism was still
Second, within the management of CCI programmes, high after the fall of the Berlin Wall and the release
18 let’s not fool ourselves that we are using as a of Nelson Mandela. Whatever the challenges of the
management tool the full power of the measurement next decade, companies will be centre stage, for
19 data we’ve now got, and so are able to demonstrate good or ill. I believe that effective community
value for money and effectiveness for company and involvement has a small but vitally important part to
20 community. That’s what the LBG’s ‘4G’ agenda is all play in building that more hopeful future.
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Deloitte ScottishPower 21
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LBG TENTH ANNIVERSARY REPORT
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We gratefully acknowledge the generous support of the sponsors of
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design www.redletterdesign.co.uk The LBG is a group of companies
print scanplus who have developed, tested and
now implement the LBG model.
20 The Group is managed on behalf
This report is printed on Look! paper, of its members by The Corporate
manufactured from wood fibre obtained from Citizenship Company.
sustainable forests. It is totally chlorine free
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and fully recyclable and biodegradable. It is
produced to ISO 14001 certification. www.lbg-online.net
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