Universal Standards for Social Performance Management June 2012

Agenda Overview of the universal standards for SPM The development process Frequently asked questions Launch of the Standards and next steps

What are the universal standards for social performance management? A set of management standards that apply to all microfinance institutions pursuing a double bottom line. Meeting the standards signifies that an institution has “strong” social performance management practices. The Standards document contains standards, essential practices, and additional good practices The document is organized into six categories: Define and Monitor Social Goals; Ensure Board, Management, and Employee Commitment to Social Performance; Treat Clients Responsibly; Design Products, Services, Delivery Models and Channels That Meet Clients’ Needs and Preferences; Treat Employees Responsibly; and Balance Financial and Social Performance

Why these six categories? The SPTF started with the assumption that, to achieve a double bottom line, an institution must: Set a strategy: who are the target clients, what are the goals, how do the offered products and services help achieve those goals, and how to balance financial returns and social performance? Build employee buy-in: understanding of mission, motivation, responsibilities, and treatment / work environment Put the client first: protect and advance the client in all aspects of the institution’s work Together, the six categories of standards present practices for managing the above three areas of activity, at all levels and in all departments of the institution.

What is a double bottom line institution? Seeks not only financial sustainability, but also to achieve one or more social goals. Works toward increasing financial inclusion and creating benefits for clients, beginning with reducing client vulnerability Ensures that clients are not harmed Within the parameters described above, each institution will define its own unique social goals

Agenda Overview of the universal standards for SPM The development process Frequently asked questions Launch of the Standards and next steps

SPTF developed the Standards in response to member demand Task Force members asked the SPTF to establish clear standards for strong SPM for microfinance institutions. Two main uses of the standards: Help assess own SP management practices Provide guidance on how to strengthen SP management practices The Standards respond to an industry desire to re-focus microfinance on the client. Many institutions claim to improve client welfare but focus more on financial sustainability than on the needs of clients.

The Standards combine and build from the work of other key initiatives The Standards incorporate work of many other initiatives/organizations: Imp-Act Consortium CERISE Smart Campaign MFTransparency MicroSave International Labor Organization MIX (social performance indicators and data analysis) Standards are aligned with, and reinforce, existing initiatives

SPTF developed the Standards collaboratively and has built buy-in 18-month process Three main rounds of feedback (fall 2011 on standards, spring 2012 on practices, final comment period on entire document in May 2012) Feedback gathered in a variety of ways: working groups, surveys, conversations with MFIs in the field, webinars Industry-wide input: Approximately 40 countries Approximately 300-400 people (100 people in working groups, 137 MFI practitioners in fall round of feedback, 180 MFI practitioners in spring round of feedback, Task Force members in Bern and Den Bosch meetings, SPTF Steering Committee) Note: All 1300+ members of the SPTF were invited to provide feedback

Agenda Overview of the universal standards for SPM The development process Frequently asked questions Launch of the Standards and next steps

Some common questions are arising from a wide range of Task Force members It is difficult for MFIs to do all of this – is it unrealistic? Do I have to comply? How is Client Protection incorporated into the Standards? How do the Standards fit in with other initiatives? Do I have to get certified on each? Why do you focus on management practices instead of client outcomes?

Agenda Overview of the universal standards for SPM The development process to date Frequently asked questions Launch of the Standards and next steps

SPTF is launching the Standards at the 2012 annual meeting in Jordan Official release of the final version of the Standards – document also available in multiple languages on SPTF website Shift in focus from development of the Standards to implementation. Key discussion points for each stakeholder group: How are the Standards useful for our work? What is our role as a stakeholder group in helping the industry focus more on SPM? What is our vision for the next 1-2 years? How can I strengthen my own social performance management practices What support do I need to implement my action plan?  

Initial feedback on support needed Rank in order of priority these proposed ways to provide assistance: Build internal buy-in for the Standards. (Average score – 3.6 out of 5) Help MFIs to develop a timeline for action: what to do first, what to do second, etc. (Average score – 3.4 out of 5) Help MFIs to putting the proper management information system (MIS) in place. (Average score 3.0 out of 5) Help MFIs to understand the important elements of a Human Resources system: which positions to have, how to train employees, etc. (Average score 2.7 out of 5) Support networks/associations to develop communities of practice for MFIs to share learning. (Average score 2.6 out of 5)

Role of the SPTF Secretariat in 2012-13 Webinar series: share learning on how MFIs are actually implementing practices in each section of the Standards New resources: Developing and posting resources to the SPTF website Communication: Facilitating communication among various stakeholders Incorporation of new learning: Reviewing lessons from the field and updating the Standards as needed We want to hear from you! What further information can the STPF Secretariat provide? How can each stakeholder group support the Standards?