SPTF presentation

Green Performance, or the Environmental Impact of Microfinance has been a hot topic since the first inception of Social Performance and SPTF. While Microfinance was presenting its ‘double bottom line’ orientation to the world, in the view of some of us there was a third bottom line missing. During countless discussions with practitioners and in previous SPTF meetings there were always a lot of arguments as to why the ‘environment’ was not a relevant topic to be addressed by microfinance, and that it was too difficult and expensive in a financially challenging situation to begin with.

Things have changed. We’ve began to see how climate change affects food production, how the poorest suffer from floods and droughts and how big businesses are taking away resources, leaving the rubbish and erosion challenges to developing countries.

At the same time, social enterprises, impact investors and development banks are looking for new ways to do business, creating jobs and fighting poverty without harming the environment. It is up to each individual microfinance institution to answer this call of ‘going green’.

The green agenda may include (business) opportunities related to access to (renewable) energy and climate adaptation techniques, but also approaches to manage portfolio risks related to environmental degradation and legal compliance, as well as the environmental footprint of the MFI itself.  Each MFI is unique, and so is its green agenda.