1. INTRODUCING THE SPTF UNIVERSAL STANDARDS INTO MFIS JUNE 26, 2013 Microfinance CEO Working Group

2. 2 Agenda About the Microfinance CEO Working Group “Beta Testing” the Universal Standards Overall Learnings Methodologies Utilized Approach 1 – Self Assessment Approach 2 – Facilitated Assessment Approach 3 – Quasi Audit Questions

3. 3 About the Microfinance CEO Working Group  A collaborative effort by eight international microfinance organizations  Mission is to support the microfinance industry to reach its full potential by advocating for, and implementing, responsible business practices that keep clients at the forefront  In addition to regular meetings of CEOs, senior leaders like the social performance directors also meet regularly to share experiences & coordinate work

4. 4 “Beta Testing” the USSPM June 2012 Commitment to Test July – Nov 2012 Planning Nov 2012 – Apr 2013 Testing Apr 2013 – Now Dissemination  USSPM released at SPTF Jordan meeting; The MCWG accepted SPTF challenge to assess institutions and report back  Our goal: understand process of assessment, state of practice, and identify any concerns with the USSPM  Identified 21 partner or affiliate MFIs of the Working Group  Developed tools, gained buy in, conducted tests, and shared results  Full report available on CFI websiteCFI website

5. 5 Overall Learnings Assessing an Institution  Valuable and intensive process – requires planning and forethought  Right choice of methodology depends on MFI’s interests – USSPM can be tailored to each MFI’s needs Process Suggestions  Self assessments helpful as an introductory tool – provides guidance into relative strengths and weakness. However, external support often required at present  Recommend that CEOs not be present in group discussions to insure candor  Consult different people for different topic areas  Take advantage of assessment momentum to create an action plan

6. 6 Methodologies Utilized Self Assessment Facilitated Assessment Quasi Audit

7. 7 PROSCONS Least time-consuming optionEasy to view the Standards as a “checklist” and not think deeply No external facilitator requiredNo external guidance if there are questions Review of all EPs offer holistic view of an MFI’s practices Responses can be subjective; tendency to overestimate performance Offers initial familiarity with USSPMFew staff members knowledgeable about all areas Self Assessment  Review of an MFI’s practices by the MFI itself (typically: one or more staff completed an Excel spreadsheet)  Often followed by a facilitated group session to review results  Typically 2-6 hours for individual review, depending on level of data analysis and verification

8. 8 Example: Self Assessment  All three MFIs added goals to implement all standards within the next two years  Strengthened the relationship between Accion and the MFIs and provided opportunities for collaboration at the following network meeting  Introduced Social Performance and social goals to representatives in different departments, a topic that was not common with their everyday workload  Génesis Empresarial, Guatemala  Sogesol, Haiti  Mibanco, Peru

9. 9 Facilitated Assessment  A group of MFI staff members gather for a group discussion  Led by internal or external facilitator with deep knowledge about SPM  Typically carried out over 1 to 5 days depending on participants time PROSCONS Group forum where staff can discuss views, highlight differences of opinion, and potentially come to consensus Time consuming (especially when reviewing all 99 Essential Practices at once) Serves as “information session” on SPM in general Not all sections relevant for all staff Offers opportunity to dialogueStaff may not know about all areas of the standards Offers opportunity to leverage facilitator’s knowledge of SPM

10. 10 Facilitated Assessment  FINCA Honduras  FINCA Kyrgyzstan  FINCA Zambia  Local staff felt empowered to collaboratively determine action items around short, medium and long term implementation  Identified direct linkages between social performance standards and operational practices  Provided opportunity for cross-department dialogue on social performance and identified areas where enhanced communication could keep all staff better informed on standards implementation progress

11. 11 Quasi Audit PROSCONS External parties can ask tough questions; identify gaps – giving a more realistic picture of MFI’s current practice Most expensive and time consuming Able to triangulate and verify findings, ensuring policies are implemented Leverages consultant’s experience (can interpret an MFI’s performance compared to other MFIs)  Outside consultant contracted to support MFI with self assessment, facilitated discussions – and 1x1 interviews, focus groups, document review  ~7-8 days of onsite work in 2 visits to the MFI

12. 12 Quasi Audit  MFI’s saw the value of the beta-test as a learning and awareness exercise. It was best to have a ‘segmented approach’ inviting review of different MFI departments on specific sections that concern them  The exercise resulted in an action plan addressing the gaps identified and assigning responsibilities to various departments. All MFIs were receptive to the plan and have strong commitment to implement it  Detailed planning to become compliant is of great value, but realism in planning and expectations from management is also important  ASKI, Philippines  ESAF, India  OISL, Ghana

13. 13 Action Plan - EMFIL

14. QUESTIONS?

15. THANK YOU!