In recent years there has been a resurgence of interest in the social mission of microfinance, and particularly in understanding how to make MFIs more effective in achieving their social mission.
Social performance is defined as the effectiveness of an institution in translating its social mission into practice and relates both, the process by which performance is managed and the outcomes that result.
Managing social performance
Everyday managers of MFIs make decisions that affect both the financial and social performance of their institutions. However, most MFIs have information systems that report on financial performance only, and therefore it difficult to know how decisions that result in improved financial performance affect the clients.
In a context where most MFIs are hard pressed to deliver on their financial goals, we need to make sure the pressure to measure their social performance does not create new burdens. The concept of social performance management (SPM) builds a social lens into an MFI’s existing systems, and provides a framework where financial and social performance can be managed together and balanced. This results in a more focused and effective organisation, bringing benefits not just to clients, but to the overall operations, efficiency, and effectiveness of the MFI.
SPM is part of an increasing client-focus in the microfinance industry. It combines market research, impact assessment and client assessment methods into an over-arching framework that starts with an organisation’s social mission, looks at how to generate information about the performance of its clients, and builds this into the information and management systems.
Objectives
1. Overview of the state-of-the-art: The course will draw on the work of the Imp-Act Consortium and the International Social Performance Taskforce. Participants will gain an understanding of how social performance is defined and how social performance can be monitored and assessed.
2. Managing social performance: The course will present an overview of the practical steps involved in managing social performance. An organisation from the Latin America region which has made significant progress in managing its social performance will present its experience, highlighting successes and challenges.
3. Auditing social performance: Participants will apply a social auditing tool to their own organisations. This is an effective means for MFIs to understand the strengths and weaknesses of their own internal social performance management processes, as well as a tool for supporters and investors MFIs to identify where technical support may be valuable.
4. Rating social performance: The course will consider how the internal need for information with which to manage performance can be balanced with the need for external accountability, introducing a common framework used by three leading social rating agencies.
5. Reporting on social performance: Participants will be introduced to a set of core indicators agreed by the International Task Force and which will be reported on the MiX, as well as to simple poverty scorecards which can be used to assess the depth of outreach of microfinance institutions.
Audience
The course is targeted at people who have an interest in understanding and improving the social performance of microfinance. It will be of particular interest to senior managers of MFIs, to those supporting the strategic planning or design of MFIs, and to donors and investors who seek to understand and improve social performance rather than to prove impact.
This course is not appropriate for people who are working at an operational rather than strategic level.
