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Social Rating Overview

Social Rating Overview. Nairobi, Kenya Social Performance Workshop October 19-21, 2009. Why Social Rating?. Balances financial performance rating Financial performance only half the story of microfinance Social rating fills the gap Systematic, focussed, relatively quick approach

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Social Rating Overview

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  1. Social Rating Overview Nairobi, Kenya Social Performance Workshop October 19-21, 2009

  2. Why Social Rating? • Balances financial performance rating • Financial performance only half the story of microfinance • Social rating fills the gap • Systematic, focussed, relatively quick approach • Quicker, cheaper – than ‘impact assessment’: ‘improving’ rather than trying to prove • Social rating of MFIs • Planning social rating of MIVs (M-CRIL)

  3. Social Rating Outlook: Evolution – numbers (incl assessments) ‘pilots’ [ADA fund st] M-CRIL, Microfinanza Rating, Planet Rating, MicroRate

  4. Social Rating Outlook: Source of funding

  5. Social Rating Outlook: Geographical Coverage

  6. Social Rating Outlook: Legal form of MFIs

  7. Benefits of Social Rating For the MFI: • To provide a clear diagnostic of social performance strengths and weaknesses, an important step towards the establishment of an effective social performance management system • Same basis as social reporting standards (‘Part 1’ & ‘Part 2’) • To facilitate access to financial capital

  8. Benefits of Social Rating For external stakeholders • To provide potential donors and investors with the tools and information for making resource allocation decisions For the industry: • To increase transparency in microfinance • To compare social performance across MFIs mirrors financial performance rating

  9. Social Performance: dimensions Social Rating covers 1 to 5

  10. In relation to the pathway Results Process Impacts Intent & values Internal Systems Out puts Outcomes Social Rating

  11. What is rated? • Social performance, ‘social returns’ • Starting point is the MFI doing what it says it is? is the MFI contributing social value? - analysis of the evidence

  12. Two Social Rating products • Social Rating: MFI policies, systems, MIS analysis = ‘capacity to put mission into practice” • Social Rating + field data collection Client survey, focus groups as part of the social rating process adds field evidence (poverty assessment, client awareness and feedback); = data usually not available with MFI

  13. Two products: Basic difference – Assessment of outputs Results Process Impacts Intent & values Internal Systems Out puts Outcomes 1 Outreach – who is the MFI serving? 2 Services – are they appropriate? PORTFOLIO DATA + secondary data available + FIELD INVESTIGATION

  14. Social Rating Outlook (2006-9): Kind of product

  15. Kind of product – by agency

  16. Selected examples of analysis and findings

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