SPM Essentials Module 1 The SPM Framework Photo

SPM Essentials Module 1: The SPM Framework

Photo credit: Fonkoze, Haiti

Photos credit: Fonkoze, Haiti

The Definition of Social Performance • The effective translation of an institution’s mission into practice.

Common social missions: • Serving increasing numbers of poorer and more excluded people sustainably • Improving the quality & appropriateness of financial services through assessment of clients’ needs • Increasing clients’ social capital, assets, income, and access to services • Reducing clients’ vulnerability • Improving social responsibility of the MFI toward clients, employees, and communities

SP vs. SPM • Social performance—whether or not you achieve your social goals. • Social performance management—how you achieve your social goals.

The Definition of “SPM” • The processes an institution uses to translate its mission into practice. These include: ▫ Setting social targets; ▫ Measuring the progress toward these targets; ▫ Using the results for strategic decision-making- namely, to improve products, services, and delivery channels.

Achieve Your Mission Through Performance Management Mission Social Performance Financial Performance Management

Managing for Social Attendance recorded by Results LO’s and reported to HQ 90% attendance by borrowers Define desired performance Measure progress toward desired performance Use performance results to improve products, services, & systems LO training led to better attendance

Social Performance Pathway Information use Results Strategy Operations • Reaching target clients • Meeting target clients’ needs • Change in target clients’ lives 10

How the major initiatives fit together Social Performance Different Actors Client Protection Smart Campaign MFT + Institutional Commitment • Invest in systems to manage double / triple bottom line • Measure client outcomes • Tailor services to client need and vulnerability Guidance: Imp-Act Consortium Standards: SPTF Universal Standards for SPM Reporting: The MIX SP Report Responsible Finance (do no harm) Improve Clients’ Lives

Save the Date for Module 2 Subject: Translating your mission into social targets Date/Time: Thursday, November 1 st at 9: 00 EDT Don’t miss it!

Additional Slides

Main Stakeholders Invested in SPM �Financial service providers (MFIs) invest in SPM to: �Inform management decisions �Preempt problems (e. g. unethical staff behavior, client drop-out) �Retain clients �Attract investors/donors �Avoid reputational risk

Main Stakeholders Invested in SPM • Investors, MIVs, and Donors invest in SPM to: • Ensure they invest in social institutions • Get data, not stories �Preempt problems & attract and retain clients �Attract & report to their own investors �Avoid reputational risk

Main Stakeholders Invested in SPM �Microfinance Associations invest in SPM to: � Offer the most appropriate and relevant information and training to member MFIs � Offer assistance with SP reporting � Offer technical assistance for SPM � Assist members in developing tools and codes of conduct � Ensure that the local industry keeps/develops a client focus

Dimensions of Social Performance Intent & Design Internal Systems/ Activities Outputs Outcomes Impact

Dimensions of Social Performance Intent & Design Internal Systems/ Activities Outputs Outcomes INTENT AND DESIGN What is the mission of the institution? Does it have clear social objectives? INTERNAL SYSTEMS & ACTIVITIES What activities will the institution undertake to achieve its social mission? Are systems designed and in place to achieve those objectives? OUTPUTS Does the institution serve poor and very poor people? Are the products designed to meet their needs? OUTCOMES Have clients experienced social and economic improvements? Impact IMPACT Can change in client welfare be attributed to institutional activities?

Assessing Social Performance Internal Systems/ Activities Intent & Design Outputs Outcomes Results Process Audit Tools: Rating Tools: Client Data Tools: CERISE SPI Tool M-CRIL Progress Out of Poverty Index (PPI) Quality Audit Tool Micro. Finanza Rating Micro. Save SPM Audit Micro. Rate Planet Rating Poverty Assessment Tool (PAT) Client measurement tools (e. g. , satisfaction, dropout, food security, focus groups) Impact Econometric studies