Concrete Steps to Managing Social Performance: SPTF’s Campaign Commitment

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Social Performance Task Force declared its support for the goal of helping 100 million families lift themselves out of extreme poverty by renewing their Campaign Commitment at the 17th Microcredit Summit in Merida, Mexico. The Microcredit Summit Campaign recently caught up with SPTF to learn about the progress they have made towards achieving their 2013 Commitment, as well as the ways they are working towards the end of extreme poverty. 

>> By Katie Hoffmann, Manager, Responsible Inclusive Finance
SPTF Universal Standards infographicSince launching the Universal Standards for Social Performance Management (“Universal Standards) at its annual meeting in June 2012, the Social Performance Task Force (SPTF) has worked extensively with microfinance stakeholders to promote awareness of the Universal Standards and an understanding of how they can serve as a resource to each stakeholder group.

This past year, we began shifting our focus from awareness toward implementation. Now that the Universal Standards have been developed and the industry is increasingly convinced of the overall benefits of strong social performance management (SPM), we want to help institutions take concrete action toward improvement – specifically, through assessment and implementation.

Such a focus goes hand-in-hand with the Microcredit Summit Campaign’s goals of lifting 100 million people out of extreme poverty. Social performance management helps institutions establish processes and practices that make their social missions – such as alleviating poverty – a reality. Without paying deliberate attention to these management practices, it is difficult for institutions, despite their best intentions, to fulfill their missions.

Through close collaboration with several industry partners, we made great strides this year toward helping institutions assess and improve their practices – steps that mark progress toward our Campaign Commitment.

  • Development and beta-test of the SPI4. Before they can improve practices, institutions must identify their strengths and weaknesses in SPM. To that end, we pledged to work with CERISE to develop the SPI4 assessment tool and to help at least 50 MFIs use the tool during 2014.

To achieve this, several members of the SPTF Secretariat participated in the SPI4 Expert Panel, helping review the tool’s functionality and the Universal Standards indicators at various stages throughout the fall of 2013.

The SPI4 launched in beta form in February 2014, giving financial institutions a tool to assess their practices against the full set of Universal Standards indicators for the first time. After the launch, SPTF promoted the beta launch among its 1,500 members and provided scholarships for 11 beta testers to attend its 2014 Annual Meeting to share their experiences.

To date, 38 MFIs have participated in the beta test of the SPI4, and we are on track to meet our goal of 50 by the end of the year. These beta testers have shared feedback with CERISE, which is adjusting the tool accordingly for its full launch in early 2015.

Given the importance of assessment in improving institutions’ SPM, we are renewing our commitment to helping financial institutions evaluate themselves with the SPI4, and we are boosting our goal to having an additional 100 MFIs use the tool in the year 2015.

  • Development of Implementation Guide. After evaluating current practice, MFIs must develop an action plan and strengthen gap areas. To assist them, SPTF developed a detailed technical guide, which would help institutions implement the Universal Standards for SPM.

Leah Wardle, SPTF Senior Social Performance Specialist, was principal author the guide, in close collaboration with CGAP. Several industry stakeholders, including investors, MFIs and networks, reviewed the document and provided feedback throughout the process.

The result is a comprehensive technical manual for implementing the Universal Standards. Published in May 2014, the guide begins with a framework for creating an SPM action plan, discusses how to operationalize that plan, and then provides step-by-step guidance on how to implement each standard, as well as case studies that describe how other institutions are implementing standards.

Now that the guide has been developed, SPTF is committed to helping financial institutions use the guide and begin making changes. Specifically, we are aiming to disseminate the document, either in person or via downloads, 1,000 times in the upcoming year. The guide can be found on SPTF’s Resource Center, which includes additional case studies and sample documents for implementing the Universal Standards.

  • Coordination with the Responsible Inclusive Finance Working Group. In 2013, seven initiatives in responsible inclusive finance – CERISE, MIX, MFTransparency, PIIF, Smart Campaign, SPTF and Truelift – formed the Responsible Inclusive Finance (RIF) Working Group, aiming to better coordinate, clarify industry confusion and reduce duplication of efforts. Given the necessity to coordinate with initiatives to advance practices in responsible inclusive finance, SPTF committed to work with the RIF Working Group to reduce duplication of work and jointly advance practice in responsible inclusive finance.

The group has met bimonthly throughout the year, focusing on various ways to streamline efforts. In October, the group developed a framework for improving practice in five steps – Learn, Assess, Plan, Implement and Demonstrate. Each stage outlines the various resources and tools available for MFIs at that step, depending on the institution’s mission.

Now, the group is developing a joint full-day training, designed to help participants better understand the resources and tools available to them, and to identify a path tailored to their own institution to improve practice. Additionally, the group is building local capacity to deliver these presentations, as well as to conduct assessments and technical assistance.  Because close collaboration with industry initiatives is necessary to advancing responsible inclusive finance, SPTF is renewing its commitment to work with the group and is aiming to hold 12 full-day trainings with the group in the upcoming year.

These efforts contribute to the Campaign’s goals by strengthening institutions’ capacity to translate their social missions into practice.

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