Guidelines on Outcomes Management for Investors

How to integrate outcomes measurement, analysis and reporting into investment operations

The 10th edition of the European Dialogue presents guidelines for integrating outcomes measurement into the operations of inclusive finance investors. The Social Performance Task Force (SPTF) Outcomes Working Group as follows defines outcomes as change for clients that is plausibly associated with the financial service provider's services. Note that outcome (e.g., change in clients business sales) goes beyond output (e.g., access to financial services), but does not imply a rigorous attribution, which impact does (e.g., percent change of business sales due to the loan use). Even without the attribution question, the social outcome territory can be challenging. Yet, it is essential for the financial inclusion industry to manage its promise and its reputation risk with clients, FSPs, regulators, asset managers and asset owners.

These guidelines review emerging practices and provide insights on why and how investors can engage in the challenging task of outcomes management. They are a first step in exploring how investors can bridge some gaps in outcomes management. As practices evolve, it will be useful to dig deeper in how the risk, return, and outcome trio plays in asset allocation decisions, what an outcomes management system looks like when it’s on-going (as opposed to start-up), and how inputs, outputs, and outcomes reinforce each other. The guidelines incorporate case studies from eight social investors, including two e-MFP members Oikocredit and Triple Jump.

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By Spaggiari, L.