Evaluation and Development of Good Governance in Microfinance Institutions

This guide and its support handbook aim to give board members, managers, MFI personnel, investors, and consultants an instrument that will support them in strengthening governance processes. It provides this through a better definition of roles, information systems and processes of supervision, oversight, conflict management, and decision-making.

The guide identifies four phases that comprise the evaluation of good governance through accompaniment by an external consultant, namely preliminary phase, MFI visit phase, results development phase, and results presentation phase. It:

• Divides each phase into macro activities;
• Specifies the objectives, activities, and tools that will be used to carry out each phase;
• Indicates a recommended methodology for each tool;
• Presents a knowledge base (KB) for most tools which specify the most efficient governance practices as well as the precautions to be considered for each question;
• Classifies each question according to the logic of the four areas that make up the common foundation of a good governance system for an MFI.