Oikocredit pushes for social audit of microfinance investors

Microfinance Focus, Oct. 15, 2009: In order to measure the economic performance and social progress of microfinance investments, Oikocredit has announced unveiled substantial steps to assess the social performance of its 500 partners in microfinance.

“It is essential to know that investments of some € 370 million lead to positive changes in the lives of the working poor,” it said in a statement. Since 2005, Oikocredit has increased the number of tools used to monitor and assess social performance. In addition to impact studies, Oikocredit said it has carefully reviewed its partner’s mission, their products and services, their interest rates and their gender and environment policies.

Social auditing
Oikocredit, by turning the examination on itself, is the first financier to collaborate with Cerise in the on-going development of the social audit tool. Cerise is at the forefront of social performance, and serves as an exchange platform on practices in microfinance. Cerise’s Social Performance Indicator tool, a social audit instrument for microfinance institutions, is recognized by CGAP, SEEP network and donors worldwide. The tool is currently being developed to analyze financier’s internal systems and processes. Oikocredit’s collaboration in this development process reflects its commitment to a serious assessment of its policies, procedures, products and services and the extent to which it fulfils its mission, the statement said.

Main findings
Currently, Oikocredit collects information on its microfinance partners and draws their attention to tools to enable them to know their 16,8 million clients better and to improve their products. The main challenge is now to operate the shift from collection and assessment of data to management. This implies a pro-active strategy to improve and promote social performance.

Using the outcome from this audit, Oikocredit wants to update its social performance procedures and further develop its outreach strategy, products and services.

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