1. Conducting Social Audits with members: AMFA experience
Sevda Huseynova
June 5, 2012
SPTF Meeting, Jordan

2. Introduction of SPM & Social Audit in Azerbaijan
Project introduced :
in January, 2008
Project Goal:
To advance SPM in Azerbaijan Microfinance market and facilitate achieving greater transparency in achieving ‘double bottom line’.
Success Factors :
Strategic partnership with MFC : Joint fund raising initiative
High commitment of ICCO as social fund to support the networks

3. Developing own capacity on SP
SPM WG meeting in Warsaw ( )
SPM training by MFC (2008)
Pilot Social Audit (SA) in VF AzerCredit
ToT in Ethiopia (Dec.2008)
ToT on SP in Bishkek (2009)
Social Audits in 8 nescent member MFIs
SPTF meeting in Madrid (2009), Bern (2010) & Den Bosch (2011)

4. Social Audit –AMFA service
Use of MFC QAT tool
3-5 days duration
Target Org-s: MFIs with social mission & committed to SP
Recommended once in 2 years (track the changes).
Price: depends on MFI size
8 Social Audits done

5. Social audits by AMFA
Under the project “Promoting Social Performance in Azerbaijan
3 Social audits
Under the Corporate Social Responsibility project funded by AMFA member - NBCO CredAgro
5 Social audits

6. Benefits of Social Audit for MFIs – improved social performance
Segments the portfolio in performance by client characteristics, identify market niches, opportunities and problems
Helps to monitor how clients use services, will help to understand if the services appropriate to the needs of target clients
Helps to improve client satisfaction and loyalty through better products and services
Tracks impact on client’s lives

7. Benefits of Social Audit for MFIs – improved financial performance
Will increase the retention of clients
Will help the program to grow, by offering attractive products and services
Will lower operational costs, resources will be used more effectively
Will serve as substantial information for PR/Marketing publications

8. Benefits of Social Audit for MFIs – improved reputation
Will raise credibility among social investors, public and local government.
Will help to demonstrate social performance to stakeholders, which will be useful to strengthen the position in funding market
Will support obtaining international accreditation via participating at various industry performance awards programs

9. Motivation & Benefits for the Networks
Excellent element of advocacy/lobbying strategy
Enables AMFA to achieve its mission “advancing interests of microfinance community and clients”
Area of expertise demanded by members & appreciated by funders
Opportunity to build reputation of “Industry Expert in SPM” in country and globally
Potential revenue generating stream: members willing to pay for this service if offered locally & professionally

10. Motivation & Benefits for Networks -continued
Perfect multipurpose facility:
preventing MF shifting away from original social mission-revealing unique features of MF business model
“scanning” MFI’s performance and suggesting improvements without giving any grades
enabling the network to engage members to validate own social mission
Deepening relationships with member organizations

11. Lessons Learnt
Promotion of SPM among MFIs practitioners could be achieved more efficiently if SOCIAL AUDIT is conducted FIRST and followed by the training on SPM and not vice versa.
WHY?
Easy to understand on practical example of own organization
Opportunity for joint assessment with network and better understanding of the QAT exercise in practice
Increased self-confidence of MFI’s team in using QAT independently

12. THANK YOU! Sevda Huseynova Azerbaijan Micro-finance Association program@amfa.az