Assessment of the economic contribution of a company often has a narrow focus on its community expenditure, or even the distribution of its reported profits. In practice, these calculations are only a very limited part of a firm's overall economic contribution. Economists usually measure the economic contribution of a business to the economy in terms of its value added. This represents the most direct contribution of an economic activity and is defined as the value of total output less the cost of intermediate inputs.

Equally, it could also be defined as the sum of remuneration to labour in the form of wages and other benefits, taxes and royalties, dividends provided to shareholders, interest payments, and cash retained in the business to fund future investment and replace depreciated assets.

However, although the calculation of value added does not include payments for materials, facilities and services purchased by companies, these represent an important indirect contribution to economic activity, supporting employment and wealth creation in other parts of the economy.

The final economic contribution will include the effect of workers spending their wages, governments distributing their tax revenues and shareholders spending their profits. These are the so called induced contributions. The generation of export revenues also represents an important economic benefit, as does the provision of local infrastructure such as roads, power and telecommunications.

More on Rio Tinto's economic value added for 2003.