SPM Principles
These Principles are endorsed by the Social Performance Task Force, which represents over 550 organisations worldwide
Putting the “social” into performance management
As social businesses, microfinance institutions (MFIs) apply commercial means to achieve social ends. Social goals include larger numbers of poor and excluded people; improving the quality and appropriateness of financial services; creating benefits for clients; and improving social responsibility of an MFI, among other values.
Because of this, our experience demonstrates that effective performance management in microfinance requires both a social and financial perspective.
An MFI that manages its social performance will deliberately:
Translate its mission and values into clear, measurable objectives to capture intentional social benefits. MFIs that are clear about their objectives are more likely to have a deliberate strategy to achieve them. Read about Fonkoze's experience here>
Design and implement systems for social responsibility, including client protection. At a minimum, MFIs should ensure they do no harm. Microfinance has great potential to help clients, but it also has the potential to hurt them, especially through over-indebtedness. Read about Prizma's experience here>
Track, understand and report on whether it is achieving its social objectives. MFIs that manage their social performance are more effective at reaching their target market, delivering appropriate services, and creating positive changes for clients. Read about SEF's experience here>
Align its business processes to achieve both social and financial objectives. All aspects of an MFI’s operations affect whether it achieves its social goals, including marketing, recruitment, staff training, incentives, organisational culture and board composition. Read about CRECER's experience here>
Ensure that decision-making considers both social and financial outcomes. Awareness of the social and financial consequences of decisions leads to better overall performance management. Read about AMK's experience here>
MFIs that integrate a social lens into performance management processes will benefit not only from more loyal and satisfied clients, but also an ability to demonstrate social outcomes to external stakeholders, including social investors.
Learn more about the key issues in SPM>
Read MFI stories from the field>
