Social Performance Taskforce New Website

http://www.sptf.info/ is the new platform of the Social Performance task Force.

The Social Performance Task Force consists of over 350 leaders from all over the world from every microfinance stakeholder group: practitioners, donors and investors (multilateral, bilateral, and private), national and regional networks, technical assistance providers, rating agencies, academics and researchers, and others. Created in March 2005, the Task Force has been charged with clearly defining social performance and addressing questions about measuring and managing social performance.

Findesa finalist - finished second

During last week's GRI conference in Amsterdam, it was announced at the readers' choice award dinner that Findesa had finished second, in the SME category GRI reporters. An achievement that deserves our congratulations!! Findesa created a wonderful occasion for all TSF participants to be seen and heard on an international platform. The conference proceedings and podcasts of all the sessions can be found at www.globalreporting.org.

GRI Awards!

Have your say on sustainability reporting today in the GRI Readers’ Choice Awards and Survey

The TSF Project invites all readers to support the participants by scoring their sustainability reports, in order to make them eligible for the GRI readers'choice awards! (See below for more backgound information and how-to)

In case you need information or support with this scoring, please contact gj.schuite@triodosfacet.nl and your TSF coach will support you with signing up and perform the actual scoring.

From 1 October the GRI Readers’ Choice Awards and Survey will give all sustainability report users worldwide a voice on the current state of sustainability reporting. Sustainability report readers will have the opportunity to score a minimum of two sustainability reports from 2006 and contribute to deciding which reports should deserve recognition in the GRI Readers’ Choice Awards. In conjunction with the Awards KPMG and SustainAbility, the leading global sustainability reporting trend monitors, will conduct an online survey about sustainability report readers needs and preferences.
These results of the Awards and Survey will give all sustainability report users worldwide the opportunity to shape the future of best practice in sustainability reporting.
Both the Global Readers’ Choice Awards and the Survey results will be presented during ‘The Amsterdam Global Conference on Sustainability and Transparency’, which will be held 7 - 9 May, 2008. All readers who score a minimum of two reports will qualify for the prize draw to win one of six all expenses paid trips to the conference.
Your opinion counts. To find out more information, register and start scoring reports go to www.awards.globalreporting.org

Environmental and social risk management tools for MFIs

The Netherlands Finance Development Company FMO published on its website a series of new interesting tools for Microfinance Institutions. Some TSF participants have already participated in a dedicated training with other MFI's.

FMO has developed practical and easy-to-use environmental and social risk management tools for microfinance institutions (MFIs).
The E&S risk management support tools for MFIs, now available in English and Spanish, include:

Part A: Office Guide
The Office Guide consists of guidance on how E&S evaluation and follow-up processes (= the Environmental and Social Management System) can be put in place in alignment with the MFI's regular credit evaluation, approval and monitoring and reporting processes.

Part B: Field Guide
The actual Field Guide provides the MFI loan officer with practical guidance to address environmental and social themes in the contact with their clients. There are two main sections:

An Activity Assessment Tool - this is a matrix, summarizing the key environmental and social risks for each of the various sectors that MFIs work in: various forms of agriculture, services, and manufacturing.

24 Fact Sheets, describing in a practical way for each sector as identified in the Activity Assessment Tool, the relevant environmental and social themes, with simple to recognize icons,
guidance for the loan officer to assess the situation with the client for each of the relevant themes, explanation of the benefits for the microclients of improvement on environmental and social matters, and recommendations for possible prevention and mitigation measures (actions to agree upon with the client, practical advice), best practices,
Next this, information is given on the legal context, and practical tips for implementation.

Part C: Training Guide
FMO provides practical training courses to client MFIs and MFI Funds to help them underway in setting up the relevant management systems. This Training Guide Contains all the materials used, and these materials can be used in-house by the MFI to further train staff.

FMO published these Guides in English and Spanish here.

Sustainable Banking is HOT

In a recent Financial Times Article (info here), the author claims that more and more banks are embracing sustainable banking as a strategy to gain a competitive advantage. This is no mere Western phenomenon – the FT Sustainable Banking Awards show that banks from Asia, Africa and Latin America have joined the world of sustainable banking.
In a recent IFC survey, 86% of financial institutions reported positive changes as a result of measures to integrate social and environmental issues into their business. Even more significantly, not a single one reported any negative effects.
Almost three-quarters of banks questioned responded that the reduction in risk associated with better management of social and environmental issues significantly reduced the likelihood of bad debts, damage to the bank’s reputation, and costly opposition from negatively affected social groups and non-governmental organizations.
Almost 50% said that adherence to sustainable guidelines also increased their access to international financial assets.
Finally, more than a third of banks questioned announced that they had won new business as a result. New opportunities have arisen in the areas of loans for environmental projects, access to new markets and expansion into sustainability-driven sectors, such as the rapidly expanding eco-efficiency and clean-production sectors.

Climate Change implications for Microfinance

MIX released today issue #14 of the MicroBanking Bulletin (MBB) Spring 2007 [download online version here]. Feature articles include possible implications of global climate change for microfinance.

In the article, the authors (Paul Rippey and Elisabeth Rhyne) state that ' Microfinance is not usually considered to be one of the key players in addressing the global warming challenge — unlike, for example the transportation and energy sectors. However, on investigation, the extensive networks of MFIs, branch offices, field workers and customers will be implicated in climate change issues to a surprising extent. As good corporate citizens, MFIs can and should take actions, including awareness-raising among their clients, advocacy with policy makers, and modeling of climate-conscious practices in their own businesses.'

A direct link to the climate change article here.

Need Support from MFIs to Complete Survey

A survey was developed by CGAP's Social Performance Taskforce to help finalize a list of core social performance indicators that can be used to track the social performance of MFIs on a wide scale (e.g., on the MIX Market)

The survey should take about 1 hour to complete. Feedback of MFI's is considered CRITICAL and we thank you for taking the time to participate in the survey, before May 25, 2007. The results of the survey will be presented at the next Social Performance Taskforce meeting (Paris, June 10–12), and a limited number of survey respondents will be invited to share their thoughts in person with Taskforce members.

More information and the survey itself can be found here (
http://www.surveymonkey.com/s.asp?u=962093704522)


En Español:
El Taskforce de Desempeño Social quiere SU retroalimentación para escoger INDICADORES CLAVES DE DESEMPEÑO SOCIAL. Se presentarán los resultados de la encuesta en la siguiente reunión del Taskforce de Desempeño Social (Paris, 10-12 de junio).
Favor de enviar sus respuestas antes del 25 de mayo, 2007. Para acceder la encuesta Presione aquí.

SEEP's Social Performance Progress Brief

The SEEP Network just released its latest Social Performance Progress Brief (March 2007, Vol 1, Nr 3). This briefing series is a SEEP Network initiative to introduce the concepts of social performance to the microenterprise field.
In the brief the authors state that ‘…. for many MFIs [the starting point] has been their mission and commitment to providing access to the poor and helping them improve their social and economic conditions. But while the microfinance industry over the years has adopted a set of financial indicators with clear reporting standards and guidelines to determine the financial health of institutions, there exists no corresponding set of social performance indicators. Recently, the microfinance industry’s widespread interest in complementing financial assessments of MFIs with assessments of their social performance has blossomed into a number of different tools for this purpose.’

Three initiatives are being presented in this Brief, including the FACET BV operated Triodos Bank and the Global Reporting Initiative:Transparency in Sustainability and Finance (TSF) project. For a link click: Social Performance Progress Brief vol. 1 no. 3

UPsides

'UPsides' is a new magazine about finance and development. It's a quarterly international magazine, published by FMO, the Netherlands Development Finance Company. The first issue is available online: http://www.upsides.nl/Download/Upsides_1.pdf

On Page 24 and 25, the TSF Project is being presented.

Two New Articles

Dear reader,

Two recently published articles are both very interesting to check out (links attached to the covers above)

First off, a document titled "Sustainability Management and Reporting' (UNEP FI, Dec 2006). The document zooms in on the benefits for financial institutions in developing and emerging economies. Quote: ' It is becoming increasingly apparent that full disclosure and transparent reporting around environmental, social and governance issues – in fact the whole spectrum of issues that make up sustainability – is a key differentiating factor between those institutions that are leading and those which are reactive in this complex area.'

The second document, titled 'The do's and dont's of Sustainable Banking' (BankTrack, Nov 2006), challenges banks to 'embark upon the journey towards sustainability'. This document is written not especially for microfinance banks or emerging countries, but it nevertheless contains some interesting viewpoints, for instance this:

' Don’t treat sustainability as a niche market. Do recognize that sustainability is already at the core of all your business activities, as most activities financed by your bank have social and environmental impacts, be they positive or negative. The challenge is to recognize these impacts and shift their balance in a positive direction.'

Four Scenarios for the Future of Microfinance

Here's a link to a recent 'Focus Note' by CGAP, summarizing the results of a 'scenario-building exercise to help anticipate and prepare for the (...) forces that will shape the future of microfinance'.

A quote:
" ... it is essential to temper expectations about the extent to which microfinance can eliminate poverty or reach the very bottom—destitute households—sustainably. A realistic evidence-based story must be provided. The search for better measures of impact remains an important
strategy to prepare for the critiques that will inevitably come and capitalize on the real potential of microfinance."