Swiss Agency for Development and Cooperation (SDC)
Swiss Agency for Development and Cooperation (SDC)
August 2003
Executive Summary
A team comprising Dirk Steinwand from GTZ, Johan de Waard, Ministry of Foreign Affairs, the Netherlands , and Brigit Helms and Eric Duflos of CGAP conducted a Donor Peer Review of SDC in Bern from 18 to 22 August, 2003. The review is part of a 17-agency initiative launched by Development Ministers, heads of agencies, and CGAP to concretely tackle aid effectiveness by using microfinance as a test case.
The Peer Review team focused on the internal procedures, practices and processes of SDC to identify the success factors and constraints that influence the effectiveness of the agency’s microfinance operations. The Financial Sector Development (FSD) staff provided the team with an orientation to SDC and organized meetings with 54 people throughout the agency, including consultation with country departments, cooperation office staff and external partners. The team briefed Managing Director Ambassador Walter Fust and staff on its initial findings on 22 August 2003.
The team hopes that this letter to management will enrich the internal discussions and provide ideas on how SDC can further increase its effectiveness in microfinance. This letter outlines SDC's strengths and challenges, and presents specific recommendations. A matrix at the end of the letter provides a summary of the key findings and recommendations.
The peer review team makes five concrete recommendations to management to enable SDC to improve its microfinance operations. The team hopes these recommendations will also prove helpful for enhancing SDC's overall effectiveness.
- Sharpen strategic clarity on Financial Sector Development (FSD). SDC should build ownership for its existing FSD policy by illustrating its operational implications with regional good practices while involving top management.
- Improve quality and accountability of operations. SDC needs to improve the quality of its operations by ensuring that any project with financial services (e.g. funds) receives systematic technical inputs at the planning stage. In addition to spelling out clear exit criteria, SDC should also increase accountability for results by applying performance based contracts and stronger monitoring systems.
- Enhance technical capacity. SDC should build technical competencies within the rotation framework, maintain minimum technical expertise for program management and further define the role of the FSD team.
- Deepen knowledge management. SDC should create incentives and promote mutual benefits for knowledge management, develop professional networks, and design instruments to disseminate know how among cooperation offices, the rest of the organization and other agencies.
- Increase partnership with SECO and other agencies. SDC should continue to build on its partnership with SECO, promote itself as a flexible partner to other donors and continue to feed its field experience into policy dialogue.
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