1. Introduction to the Social Performance Indicators (SPI) Tool

2. Introductions & Expectations Microfinance knowledge exchange network focused on disseminating good practices Core members: five French organizations specialized in microfinance Partners: MFIs, networks, donors, researchers, and investors in Africa, Latin America and Asia Working areas: impact and social performance, governance, rural and agricultural finance. www.cerise-microfinance.org CERISE

3. CERISE and Social Performance Actively promoting social performance in the MF sector since 2001 Created Social Performance Indicators tool (SPI) to assess performance of MFI partners Since 2008, broadening focus to include investors – SPI Investor under development Introductions & Expectations

4. ProsperA network PROmotion of Social PERformance – an Alliance initiated by CERISE and its partners Over 60 members (June 2011)  Networks from Africa, Asia and Latin America  MFIs  Multilateral agencies  TA providers from Europe  Social investors www.cerise-microfinance.org/-reseau-prospera- Introductions & Expectations

5. Overview 1. Background to the SPI 2. The SPI in a nutshell 3. SPI and SPM Objective Familiarize participants with the SPI and its use as a Social Performance Assessment tool and entry point to Social Performance Management

6. 1. Background to SPI

7. Background to SPI 90’s: Emphasis was on financial performance, little attention for social performance First discussions in 2001 (CERISE & partner MFIs): Microfinance and social links A need to improve accountability + visibility for social performance, in order to promote microfinance’s core priority. Development process But, no tools!

8. Background to SPI Development process of SPI initiative SPI 1 (2001 – 2003) - Conceptual framework (research and practitionners) - SPI tool version 1 SPI 2 (2004 – 2005) - Field testing: 25 MFIs in different contexts - SPI version 2 and operational guide SPI 3 (2006 – 2009) - Promotion of SP, association with SPTF - SPI version 3 compatible with MIX SPS SPI4 (2009 – 2011) SPI for the investors Work with MFIs to innovate and improve practices: rural finance, new products, savings, consumer protection, client surveys, MIS

9. Background to SPI Most recent version of SPI (3.3) Excel format, no macros! (compatible Mac/PC) Compatible with Social Performance Standards reported to MIX Integrates latest initiatives: Smart Campaign, SPTF Universal Standards, Seal of Excellence, MFTransparency, MIV Disclosures Guidelines. Wiki to access material, ask questions, leave comments SPI Standards of Use

10. Who uses SPI? Background to SPI MFIs 450 SPI audits in CERISE/ProsperA database (around 350 MFIs) MFIs 450 SPI audits in CERISE/ProsperA database (around 350 MFIs) MFI Networks Benchmarking SP, standardized reporting, MIS MFI Networks Benchmarking SP, standardized reporting, MIS Social Investors way to dialogue with partners, raise awareness of SP Social Investors way to dialogue with partners, raise awareness of SP Foro Lac Fr, RFR, Finrural, CIF, Consortium Alafia, MCPI… Oikocredit, Kiva, Grameen-Crédit Agricole, AFD, Sidi, etc SPI users from ProsperA network

11. 2. The SPI in a nutshell

12. SPI Layout Questionnaire (Excel) Questionnaire (Excel) Operational Guide (Wiki Page)Wiki Page Operational Guide (Wiki Page)Wiki Page Standards of Use Guidelines by indicator Information sources Opportunity to comment Standards of Use Guidelines by indicator Information sources Opportunity to comment Contact information Part 1: Profile, Social Strategy & Governance Part 2: SP Indicators (4 dimensions) Contact information Part 1: Profile, Social Strategy & Governance Part 2: SP Indicators (4 dimensions)

13. Audits the internal processes the MFI has in place for reaching its social mission. Intent What is the MFI’s mission? Does it have clear social objectives? Internal systems and activities Are they in place to help achieve objectives? Outputs Does the MFI know whether it’s reaching target clients? Outcomes Does the MFI know whether its clients have seen improvement? What does it do? The SPI tool NOT IMPACT ANALYSIS! NOT IMPACT ANALYSIS! Intent Internal systems/activities OutputsOutcomes

14. Part One: Description of MFI, Context, Social Strategy, Financial performance Part Two: Social Performance Indicators  Dimension 1: Targeting and Outreach  Dimension 2: Products and Services  Dimension 3: Benefits to Clients  Dimension 4: Social Responsibility Content of Questionnaire The SPI tool Each dimension is broken into 3 criteria and has 16-19 questions for a total of 25 points

15. The SPI tool Questionnaire – Part Two Dimension 1: Targeting and Outreach Selection of operating zones Client selection devices that favour poor and excluded people Services characteristics that facilitate access of the poors and excluded Geographic Individual Pro-poor methods

16. Questionnaire – Part Two Dimension 2: Products and Services Diversity of credit, voluntary savings Decentralization, rapidity, transparency, drop-outs Direct or through partnership: transfers, mobile banking, fin ed Range of services Quality of services Innovative and non financial services The SPI tool

17. Questionnaire – Part Two Dimension 3: Benefits to Clients Tracking changes, impact studies, profit-sharing Level and quality of participation Group formation, collective management, client advocacy Economic benefits Client participation Social capital/client empowerment The SPI tool

18. Questionnaire – Part Two Dimension 4: Social Responsibility Salary scale, training, participation in decisions, turn-over Consumer protection Respect of local culture, local development, environmental protection To employees To clients To the community and environment The SPI tool

19. Internal self-assessment or external audit Centralized (top management) or participatory approach (different stakeholders and levels of the MFI) 1-3 day process (centralized) / 4-6 day (participatory) The SPI tool Methodological options

20. Simple  Why use the SPI? The SPI tool Results presented in radar and diamond graphs Easy to analyze  Standardized results  Compatible with SPS Peer group analysis Quick & easy to apply; easy to verify

21. Context and strategies Rural, women business sector Mature MFI Previous crises in MF sector (i.e: over-indebtedness, mission drift) has pushed social agenda forward SPI results Strong and balanced performance Range of services and Benefits to clients can be improved SPI results Strong and balanced performance Range of services and Benefits to clients can be improved The SPI tool Example of results: A participatory MFI

22. Communication with partners 2 page summary

23. Social Reports

24. The SPI Database Database working through Excel More than 450 SPI results sent by 350 MFIs (sept 2011 ) Results are processed on a confidential basis Enables to generate benchmarks to compare the SPI results of an MFI with those of a peer-group

25. Comparing MFI / national benchmark Criteria 1: Choose the country (Ex: Bolivia) Criteria 2: Choose the MFI (Ex: Crecer)

26. Comparing 2 national benchmarks Criteria 1: Choose the country (Ex: Ecuador) Criteria 1: Choose the type of governance (Ex: NGO) Criteria 2: Choose the type of governance (Ex: Credit Union) Criteria 2: Choose the Country (Ex: Ecuador)

27. 3. SPI and SPM

28. From “SPA” to “SPM” Systematic assessment of social performance and systematic use of this information to improve practices SPA a measure of how well an institution uses its systems and operations to generate positive social benefits SPA a measure of how well an institution uses its systems and operations to generate positive social benefits SPM the use of this measure to make decisions Social Performance Management

29. SPI as a diagnostic tool SPI as a management tool SPI as a communication tool SPI and SPM SPI as an entry point to SPM

30. 1. Setting clear social objectives and strategy 2. Monitoring progress in meeting these objectives 3. Using social performance information to make decisions Social Performance Management Three main components Data collection and use of information is at the heart of SPM Data collection and use of information is at the heart of SPM

31. SPI as a diagnostic tool Gives an overview on social performance for the MFI, strengths and weaknesses Help identify priorities for the MFI to improve SP Identifies key criteria to be followed Serves a basis for an internal control system (“social dashboard” or social scorecard) SPI and SPM

32. SPI as a management tool SPI and SPM Once identifying priority areas with the SPI, the SPI can be combined with other tools to address them An MFI wants to… Understand high drop-out rates Expand outreach to the very poor Verify decision making processes to integrate SP data Understand/ Improve overall SP or avoid mission drift Market research PPI/PAT Governance analysis Internal social audit (ex.: SPI) SPM Tool

33.  The SPI promotes transparent communication within MFI ( Board, general assembly, etc. ), with investors, clients, the sector, authorities and the general public Consistent results, easy to prepare reports and briefs Showcases good practices, highlights efforts to improve Creates a common language on social aspects of microfinance and contributes to benchmarks SPI as a communication tool SPI and SPM Good SPM hinges on effective communication of the social performance agenda to all stakeholders

34. From SPI to Social Dashboards

35. For investors, the SPI is also… SPI and SPM A diagnostic tool A governance & management tool A communication tool Does the MFI reflect the investor’s own values? Id’s priorities for managing relationships with MFIs & reduces investment risks through better knowledge of partners / potential capacity building Between MFI-investor, between investors-sharesholders, among investors

36. For more information: Website: www.cerise-microfinance.org Email: cerise@cerise-microfinance.org Wiki: http://spiwikiv3point3.pbworks.com