Image via WikipediaThe following article appears in the last issue of CTE News. Oikocredit is one of the ecumenical organisations featured on the Methodist Church website.
Oikocredit has released its first Social Performance report, detailing its commitment to making a positive difference in the lives of the poor through access to financial services. The report shows the progression and results of Oikocredit’s many years evaluating social performance. The first printed copies were presented to representatives of Oikocredit’s Project Partners and Support Associations at their Annual General Meeting in Foz do Iguaçu, Brazil.
For the past 35 years, Oikocredit's primary goal has been to provide credit to organisations which may otherwise not have access to finance. This often means supporting less established, more rural organisations, which have an outstanding social focus. Many are small organisations which support women, target rural communities and are environmentally aware. ”We can’t assume that reaching the poor and initiating positive change are automatically achieved through access to finance,” said Oikocredit managing director Tor G. Gull. “To achieve those social goals, the intent must be clearly defined and measured like financial performance is defined and measured. A combined social and financial perspective is vital for effective management in this sector.” Oikocredit monitors information on partners' outreach, products and services, as well as attention given to gender, the community and the environment. These social indicators provide a comprehensive overview, which reflects Oikocredit’s commitment to supporting grassroots economies. "Oikocredit's target groups, mission and goals are all weighted towards social impact," said Oikocredit director Social Performance and Financial Analysis Ben Simmes. "So it is essential for our clients, investors and staff that we measure how financial support translates into real life. We hope reporting in this detailed way contributes to industry-wide improvements in transparency, accountability and to products and services for the poor.”
Oikocredit manages over €425 million in development financing to almost 800 project partners, in 70 countries. Of these partners, over 500 are microfinance institutions, reaching more than 17 million clients, of whom 85% are women and 53% live in rural areas. It is paramount all partners share Oikocredit's outlook on poverty reduction and fair financing. Oikocredit is implementing an ESG (environmental, social, governance) scorecard that analyses an organisation’s operations and looks at transparency of costs, client satisfaction and evaluation of a client’s ability to repay the loan. Oikocredit was also among the first signatories of the Client Protection Principles – a Smart Campaign initiative protecting microfinance clients against unfair lending practices.
Oikocredit is a worldwide financial institution that promotes global justice by empowering disadvantaged people with credit. Since 1975 Oikocredit has offered loans, guarantees and investment capital to microfinance institutions, cooperatives, fair trade and other businesses. Today, Oikocredit operates in more than 70 countries.