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Social Performance Monitoring

Fonkoze is committed to social performance monitoring—the effective translation of our mission into practice. We are a financial institution with a social purpose and we strive to manage our organization accordingly. Monitoring social performance includes:

• Measuring the financial and social progress of our clients
• Monitoring client satisfaction with our products and services
• Maintaining our social responsibilities to the environment, our staff, and our clients

Each of these pursuits is described below.

Our Mission and Commitment to Clients

Fonkoze’s mission is to build a sustainable microfinance institution to:

• provide Haiti's poor with the financial and educational tools they need to make their way out of poverty
• eliminate the kind of poverty that leaves people without hope, motivation, and courage
• reverse the decline in Haiti's economy by empowering and motivating families to engage in sustainable economic development

 In line with our mission, Fonkoze makes six commitments to every client that enters the program. If the client fulfills her responsibilities—meeting attendance, timely loan repayment, solidarity with her group—Fonkoze commits that within five years the client will:

• Have food on her table every day
• Have a tin roof, a cement floor, and a sanitary latrine
• Be able to send all of her school-aged children to school
• Know how to read and write her name
• See her business assets accumulating
• Have the confidence to face her future, no matter what it holds

In order to know how we are fulfilling these commitments, Fonkoze regularly and systematically measures the progress of our clients as they enter and move through our programs. This is the role of the Social Performance Monitoring and Market Research Department.

Fonkoze’s Social Performance Monitoring and Market Research Department

In 2005, Fonkoze began systematically evaluating the impact of our programs on clients across the country. By the third quarter of 2009, the Social Performance department had become a team of fifteen full-time staff members working throughout Haiti.

The backbone of the department is our field staff—Social Impact Monitors (SIMs) who work full-time in eleven branch offices and collect first-hand information directly from our clients. SIMs use a poverty scorecard and food security survey to collect verifiable data on many aspects of our clients’ social development, including housing, food security, assets, literacy, sources of income, school attendance of school-age children, and business expenditures. In addition to using these two tools, SIMs:

• Conduct in-depth interviews with a sample of exiting clients
• Lead focus groups with clients across the country
• Carry out evaluations of Fonkoze’s non-financial programs

Taken together, this information is used by Fonkoze to understand the economic and social condition of our members—especially how they change over time—and to constantly improve existing products and services, or create new ones, to better suit the needs of the poor. For example, Fonkoze’s Ti Kredi (“Small Credit”) program for new entrepreneurs was created as a result of better understanding the needs of poorer clients—they require smaller loans, shorter loan terms, business skills training, and closer accompaniment by a credit agent. Fonkoze’s Alfa (“Education & Literacy”) Program developed similarly and continues to offer new courses based on feedback from clients.

In addition to developing new products based on feedback from clients, Fonkoze also makes corrections and improvements to existing products and services. In 2008, the Social Performance department collected data that reinforced Fonkoze’s suspicion that some credit centers were not meeting regularly, according to policy. At the same time, focus group discussions revealed the importance of regular meetings and well-functioning solidarity groups to business success and loan repayment. This information prompted Fonkoze to re-train credit agents on the importance and methodology of center meetings, as well as perform spot-checks to ensure compliance among branches.  These are examples of the Social Impact department’s focus on actionable monitoring and research.

Responsibility to Clients, Staff, and the Environment

Fonkoze’s social performance includes how well we uphold our responsibilities to our clients, our staff, and our environment. Each of these areas is discussed below.

Staff

In 2008, Fonkoze introduced an institution-wide policy called Fonkoze’s Commitment to our Employees.  The policy details Fonkoze’s treatment of employees, including their rights and benefits in the workplace.

In 2009, Fonkoze introduced an Employee Code of Ethics that established standards for all employees concerning respect for one another, the institution, and the clients that they serve. The Code of Ethics is the centerpiece of a renewed institutional commitment to a collaborative work environment and quality customer service.

Clients

Fonkoze demonstrates responsibility to clients by offering:

• Three different loan products tailored to the needs of different client segments
• Competitive interest rates on loans and savings
• Educational programs, linkages to health services, micro-insurance, and money transfer services

Furthermore, the majority of seats on Fonkoze’s Board of Directors are designated for client representatives. These clients are selected from among the center chiefs, who are elected by the borrowers who make up the center. The center chiefs who will attend the General Assembly are then elected at a branch level. Board members are selected from among the General Assembly delegates. As board members, they represent their fellow Fonkoze borrowers, including a key perspective in the institution’s highest decision-making body.

Fonkoze is committed to client protection in policy and in practice. We seek to offer appropriate services at competitive prices and to offer complete information to clients about these products. We constantly seek to improve our client protection principles, and we are currently engaged in an industry-wide task force to promote the fair treatment of microfinance borrowers.

The Environment

Fonkoze is aware that the degradation of Haiti’s natural resources affects the ability of our clients to grow food to feed their families, access clean water, and work in clean marketplaces. As such, we encourage clients to protect the natural resources in their communities through an educational program offered at Fonkoze credit centers. Like all of our educational programs, the Environmental Protection education program uses participatory learning techniques by which client-teachers use colorfully illustrated workbooks to discuss issues such as the preservation of trees and plants, keeping marketplaces clean, and water purification techniques.

Additionally, Fonkoze is piloting an initiative in rural Haiti aimed at encouraging farmers to preserve natural resources through better planting and harvesting practices. These farmers receive loans, technical assistance, and environmental protection education, in a holistic effort to promote sustainable agriculture among rural Haitian families.