Social Performance Reporting Awards Attract Strong Interest

July 13, 2010    

Over 300 MFIs have responded already to the call for submissions to the second annual Social Performance Reporting Awards, demonstrating their commitment to transparent reporting on the social performance of their work.

The Awards showcase the achievements of those microfinance institutions (MFIs) that are committed to transparency and accountability by reporting on the way their efforts are directly improving the lives of the poor.

The Awards were established in 2009 by CGAP together with the Ford Foundation, the Michael & Susan Dell Foundation, and the Social Performance Task Force, and are administered by the Microfinance Information Exchange (the MIX).

There is already a healthy increase in the numbers reporting this year, with nearly three months still remaining before the deadline for reports at the end of September. Of the MFIs that have reported to date, nearly half are from the Latin America and the Caribbean region and almost one quarter are based in Europe and Central Asia.

“The pace of submissions for the Social Performance Reporting Awards this year shows that MFIs understand the need for transparency in the way their activities help their clients,” said Blaine Stephen, Chief Operating Officer of the MIX. “These Awards will showcase the growing number of MFIs reporting on the social impact of their work and goes a step further by recognizing the most transparent and those that can still improve the quality of their reporting.”

The Social Performance Reporting Awards provide a yardstick for those wanting to assess an MFI’s commitment not only to showing progress in helping their clients, but also to supporting staff, and protecting the environment.

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:

• CERTIFICATE: awarded to MFIs that complete the Social Performance Reporting Report
• SILVER AWARD: awarded to MFIs that complete the report, and also provide full data on poverty measurement
• GOLD AWARD: awarded to 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.

An award will also be given to microfinance networks or associations that have more than 50%of their affiliates reporting on social performance to MIX.

Of the 41 submissions reviewed by the end of June, three MFIs had been awarded Gold status and seven were given Silver awards, while AMFA of Azerbaijan had received a Network Award for having most of its affiliates already reported.

The submissions received so far highlight the great diversity within the ranks of MFIs, and that excellence is not restricted to one class of institution over another. Gold Award winner for 2010 VF AzerCredit or Azerbaijan began operations as a microcredit program within the World Vision non-governmental organization before registering as a MFI in 2003. Another Gold Award winner in 2010, Ecuador’s Banco Solidario, is a formal bank with more than 140,000 small loan clients.
“The first Gold Award winners in 2010 show that size or legal structure are no impediment to leading the way on transparency. VF Azerbaijan has a portfolio less than one-tenth the size of Banco Solidario’s and yet both have shown an outstanding commitment to reporting the real benefits of their work with the poor,” said Xavier Reille, who heads CGAP’s transparency initiative.

CGAP, through its participation in the Social Performance Task Force, is helping the industry to adopt the tools and indicators they need to improve their social reporting. In June, it organized a roundtable with more than 50 investors to discuss different aspects of socially responsible investing. Part of their discussions focused on questions such as how to further advance reporting on environmental issues, as well as how to collect poverty-related data using scorecards such as the Progress out of Poverty or the Poverty Assessment Tool.

Addressing these issues with MFIs will lay the groundwork for improved reporting in the future and hopefully deliver a growing number of Gold and Silver Award winners in future years.
This year’s Social Performance Reporting Award winners will be recognized on the CGAP and MIX web sites and at special events, with further certificates to be awarded in a second round in December 2010.

“MIX started social performance data collection in February 2009 and by June 2010 over 300 MFIs have filled out the social performance report,” added Stephen from MIX. “A growing number of MFIs use the report not only in their social performance reporting but also in assessing their priorities in social performance management and creating work plans tailored toward their own goals."

You can download the social performance report or contact Micol Pistelli, Manager of the Social Performance Program at MIX for more information.