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Why Use Social Indicators? Making the Case to MFIs and Other Stakeholders Image

Promoting Inclusive Markets and Financial Systems

Why Use Social Indicators? Making the Case to MFIs and Other Stakeholders

Summary

This paper draws on the experiences of MFIs that participated in the multi-year CGAP/Ford Foundation Social Indicators Project (SIP). While many MFIs and stakeholders believe that social indicators are valuable to MFIs and to the microfinance industry, there are still remaining questions about why to use them. This paper will explore why social indicators are a valuable building block for performance management as well as address why social performance competes with financial performance and why at other times they are complementary. MFIs can benefit from the growing body of resources and experiences of other MFIs that are facing similar challenges developing, implementing and revising social performance measurement processes.

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