Social Performance in Microfinance: The Progress out of Poverty Index

Social Performance in Microfinance: The Progress out of Poverty Index

January 4, 2011 at 6:55 PM - by Sharlene Brown - 0 comments

We all know there are many socially responsible organizations out there. However, not all fully implement their goals and missions. It’s easy to want to change things, to have a desire to improve the world, but it’s much more difficult to make sure those changes are carried out successfully and consistently. Because of this, social performance, transparency, and enforcement have become leading focuses in the non-profit world.

Most people who are even remotely familiar with microfinance have heard of Grameen Bank. Grameen Foundation is an umbrella of Grameen, established to model the principles of Muhammad Yunus’s Grameen Bank. The foundation is one of the largest and most well -known microfinance organizations in the world.  Winner of numerous awards, including the Nobel Peace Prize in 2006, the Grameen Foundation has continued to achieve remarkable success. Its mission is to enable the poorest of the poor to create a world without poverty, and they do so by providing economic opportunities, mainly to women.

For me, one thing that stands out about the Grameen Foundation is the emphasis it puts on social performance and accountability. The Progress out of Poverty Index (PPI), a Grameen Foundation Initiative, is a resource which helps determine levels of poverty in groups and individuals, and allows to further assess clients’ needs and program effectiveness. In 2007, Oikocredit became the first social investor to adopt the PPI, and since then has continued to use it as a tool by providing PPI pilot training to many of itsproject partners.

Last fall, Oikocredit was recognized by CGAP, an independent policy and research center housed at the World Bank, for its contribution to responsible social investment. Oikocredit was one of only three organizations to be given the award for integrating environmental, social, and governance (ESG) factors into its investment practices. In order to be considered for the ESG award, Oikocredit was evaluated on transparency of reporting, integration and enforcement, engagement, and innovation.

Sharlene Brown, a Program Officer for the Grameen Foundation Social Performance Management Center, has planned and executed various PPI trainings for MFIs in Sub-Saharan Africa and the Middle-East/North Africa. In the Progress out of Poverty blog , Sharlene writes about creating a collaborative group in Sub-Saharan Africa – which includes Oikocredit – to facilitate training. She also discusses the detailed process of implementing the PPI in these regions. We are excited to have Sharlene co-host Oikocredit’s Party on January 21st, where she will speak about the importance of social performance.

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