Creating a Green Oasis for All

Introduction to the workshop to be held during the Social Performance Taskforce Meeting, Jorden, 7 June 2012

Green Performance Management in Microfinance

Microfinance aims at eliminating poverty. We believe that environmental degradation affects the poor. Therefore, microfinance practitioners should understand how their clients relate to the environment they live in. Based on this understanding an MFI is able to choose if and what measures they can take.

This Session informs participants about recent insights and ideas on Green Performance Management. Become part of the discussion, and help create a green oasis for all!

Today, society is facing a systemic and complex sustainability challenge. We must deal with ecological issues including climate change, top soil erosion, deforestation, and resource scarcity as well as social issues like poverty, public health, corruption, political instability and institutional failure.

Microfinance institutions operate in the middle of these challenges and their clients face the daily reality to overcome them. HIVOS and Triodos are working towards producing clear and simple guidelines for microfinance practitioners who choose to pro-actively engage themselves in this new field of environmental or Green Performance Management, or ‘GPM’.

When adopting the GPM principles, an MFI should understand how they can develop a ‘green’ focus in their activities. Different MFIs have different entry points. What MFIs need is a practical guide on how to assess –within their specific context-  risks related to environmental impact, in different sector and activities. They also need basic understanding of opportunities, such as cleaner production, agricultural best practices, renewable energy, energy efficiency. In some regions, farmers need to adapt to environmental degradation and climate change. MFIs should understand if and how this support of adaptation strategies is relevant in their portfolio. It’s also important to support internal clean and green policies: there are MFIs that promote efficient use of paper, water and energy in their offices, they provide environmental training, and engage in environmental projects with NGOs.

The tools offer different grades of GPM implementation from basic to advanced and can be used as modulair approach to full-fledged implementation towards GPM.

In our Session Marion Allet will present results of her ongoing research on  ‘Microdfinance and the Environmental Bottom Line’ as part of her PhD at Université Libre de Bruxelles and Université de Paris. Marion will share her findings and talk about the reasons why microfinance should look at the environmental bottom line, as well as how this can be done, including management challenges in the greening process. Most of Marion’s research findings are based on extensive fieldwork and interviews with Microfinance Practitionerss.

On behalf of HIVOS and Triodos Geert Schuite will then present the results of the on-going development of Guidelines for Microfinance Institutions to implement Green Performance Management. We see different drivers for MFIs to implement GPM, including:

·         Clients cause environmental pollution (wastewater, waste, dust, noise) and this generates problems in the community

·         Clients are being disturbed by pollution caused by others

·         Clients experience a shortage of firewood 

·         Clients need access to reliable sources of electricity

·         Clients suffer from floods

·         Clients face problems in their agricultural production due to climate change

·         The environment is explicitly mentioned in our mission statement and our products and services do not, or not enough,  reflect that notion

·         An investor wants to know about our environmental management and performance

·         There’s a market opportunity for supporting environmental friendly production and we like to profit from that

We believe that because there is a well understood specific driver that an individual MFI will develop an environmental focus in its activities and services.

In this session we aim at having a lively discussion and interaction with the participants. We are interested in creating a platform for exchanging ideas and generating input from practitioners and partners on the environmental agenda for Microfinance.

For information, questions, suggestions, please contact

Geert Schuite: gj.schuite@triodosfacet.nl