2010 Social Performance Reporting Awards launched for Microfinance Institutions

Microfinance Focus, April 23, 2010: In response to the growing need of transparency for microfinance institutions, CGAP along with its partners, the Michael & Susan Dell Foundation, the Ford Foundation, the Social Performance Task Force and the Microfinance Information Exchange (MIX), launched 2010 Social Performance Reporting Awards yesterday, says a press release.

These awards promote greater transparency in MFIs’ social performance by acknowledging MFIs with a strong commitment to accountability for how their activities change the lives of poor clients. “A few years’ ago the focus was on improving financial reporting, today the focus is shifting to social performance reporting since for microfinance business to operate effectively it must take account not just of the financial bottom line, but also of the impact it is having on its clients and the community. Institutions that can demonstrate benefits for the community will be able to attract socially-responsible investment.” said Xavier Reille, Head of CGAP’s transparency work.

More than 200 MFIs submitted reports on their social performance in 2009 to MIX and this number is expected to increase significantly in the second round. The awards provide a yardstick for those wanting to assess an MFI’s commitment to showing progress in helping their clients, supporting their staff, and protecting the environment. As such, the awards reward openness and accountability in reporting, not the actual performance of MFIs on these measures.

To qualify, MFIs provide reports on a set of social performance monitoring indicators that have been developed and refined through the Social Performance Task Force in cooperation with industry leaders. One of the most important indicators is the degree to which MFIs are measuring the poverty level of their clients and which poverty-measurement tools they are using.

The awards feature three levels of recognition. MFIs that complete the Social Performance Standards Report are given Certificates. MFIs that complete the report, and also provide data on poverty measurement are given Silver award and MFIs that complete the report, provide data on poverty measurement, and have a social rating that includes auditing of the poverty tool used by the MFI are given the Gold Award. An award will also be given to microfinance networks or associations that have more than 50 percent of their affiliates reporting on social performance to MIX. Winners will be recognized on the CGAP and MIX web sites and at special events, with certificates to be awarded in two rounds between June and December 2010. MFIs can report their social performance data to MIX till September 30, 2010.

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