“Where Good Intentions Meet Good Business Practice”; by Meraj Husain and Micol Pistelli; published by the Microfinance Information Exchange (MIX); August 2016; 16 pages; available at: https://www.themix.org/sites/default/files/publications/where_good_intentions_meet_good_business_practice_mix_august_2016_final.pdf
Drawing upon Microfinance Information Exchange (MIX)’s database of financial service provider (FSP) performance indicators, the authors examine the relationship between the social and financial performance of 780 FSPs in 98 countries. Their regression analysis explores the correlations between financial indicators relating to efficiency, portfolio quality and productivity and indicators relating to social performance such as human resource policies, borrower retention rates and the numbers of female borrowers. The authors find statistically significant correlations indicating that: (1) FSPs whose boards of directors track social performance and who target female clients tend to perform better in terms of portfolio quality, efficiency and productivity; (2) more “progressive” HR policies are associated with more productive staff and higher quality portfolios; (3) targeting solely poorer clients is associated with higher operating expense as a percentage of gross loan portfolio, but lower operating costs per borrower; and (4) FSPs with higher borrower retention rates tend to be more productive, retain staff longer and have lower costs per borrower. The authors argue that FSPs should consider social performance management not only a means of realizing their social missions, but also as good business practice.
Banking for a Better World; by Nanno Kleiterp; published by the University of Amsterdam Press; September 2016; 152 pages; available for purchase at: http://en.aup.nl/books/9789462983519-banking-for-a-better-world.html
This book is structured as a conversation between Nanno Kleiterp, the former CEO of Dutch development bank Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO), and Marijn Wiersma, a Senior Financial Inclusion Officer at FMO, both of whom argue that commercial banks and other financial service providers “can and must” orient their policies towards tackling global challenges such as poverty, inequality, population migration and climate change if the UN is to achieve its Sustainable Development Goals by 2030 as planned. Mr. Kleiterp and Ms. Wiersma argue that development banks, by connecting entrepreneurs, investors and government actors, can act as an example for traditional financial institutions to follow, encouraging a more sustainable banking model that balances financial profit with development impact.
“Beyond Dialogue: Building Sustainable and Inclusive Business Models in Partnership with Social Entrepreneurs”; published by Acumen and the Skoll Centre for Social Entrepreneurship; September 2016; 44 pages; available at: http://acumen.org/wp-content/uploads/2016/09/Acumen_BeyondDialogueReport.pdf
This report features case studies from corporations such as Ernst and Young, Levi Strauss and Microsoft intended to demonstrate possibilities for collaboration among for-profit companies and “social enterprises”. The authors argue that social enterprises, by sharing their entrepreneurial approaches to solving social problems, can assist corporations in making their business models more inclusive and global supply chains more “sustainable”. On the other hand, corporations can help social enterprises sustain and scale operations by providing traditional business expertise and financial resources. The report identifies four partnership models: (1) skills partnerships, through which corporations offer consulting or mentoring programs; (2) channel partnerships, which create links between the target markets of social enterprises and the supply and distribution networks of large corporations; (3) venture partnerships, through which corporations make equity investments in social enterprises or the two jointly invest in a new venture; and (4) knowledge partnerships, wherein companies and social enterprises partner to collect and analyze market data in areas of mutual interest.
By Michelle Dold, Research Associate
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