PPI & Social Performance

Social performance is defined as “the effective translation of an institution’s mission into practice in line with accepted social values.” Social performance describes how well an organization is achieving its mission, or social goals. Organizations that use the PPI have a mission to positively impact the lives of people living in poverty through information, health services, employment opportunities, financing, or a combination of interventions. These organizations use the PPI to better understand their performance against these social goals.

Proactive social performance management

When an organization can objectively measure poverty in each household that it affects, it can answer the following questions and more:

• In which cities is my organization reaching the most people below the poverty line? In which cities is my organization reaching the least?
• Are my organization’s poorest clients, customers, and employees as satisfied with my organization as their non-poor counterparts?
• Is my organization retaining poor customers and employees?
• Are my organization’s poorest customers and employees mostly women or men? How does this impact my organization’s strategy or operations?
• Is my organization reaching the poor like it intends?

With these insights, management can make better decisions in the interest of the poor.

Impact assessment

An organization can say that is has impacted a community when it can take credit for the change being measured. It is important to note that for organizations with a mission to reduce poverty, the PPI cannot measure impact, even if PPI data reveals that households are moving out of poverty over time. This is because the PPI does not determine causality. Management of individual organizations must analyze their unique contexts to determine if the organization can claim responsibility for changes in household poverty.

Social performance resources for microfinance professionals

The PPI has roots in microfinance because of Grameen Foundation's work in that sector. The following initiatives provide excellent resources for all microfinance professionals:

• The Social Performance Task Force (SPTF) is an international group of microfinance practitioners. The SPTF provides standards for how microfinance practitioners should address social performance.
• The Smart Campaign advocates responsible microfinance through a set of 7 client protection principles that all microfinance institutions should follow.
• Truelift is a global initiative to renew focus on the pro-poor objective of microfinance. Truelift is a trust mark – in microfinance and beyond – to signify commitment to positive and enduring change for people living in poverty.