What I'm doing

Well, the blog is called Social Performance and Salteñas so I guess, the appropriate thing to do would be to follow up the expository post with one that explains what social performance is and what I’m doing here (I’ll let you guess what the third post will be about).

Without going into too much detail, FONCRESOL is a development-oriented microfinance institution (MFI). This means that, unlike profit-oriented institutions which see microfinance simply as way of tapping into previously underserved markets, FONCRESOL provides credit with the primary aim of developing local sustainable economies. This is not to say that FONCRESOL is a charity. Making a profit is still a goal, but profitability is viewed more as a way to ensure the sustainability of the enterprise than as a goal in and of itself. This is what some people call a double bottom line: FONCRESOL seeks social returns as well as financial ones.

This double bottom line, however, makes it very tricky to gauge the success of the institution. While measuring financial returns is well understood (easy even), it is notoriously difficult to measure an institution’s social return.

This is where I come in.

Measuring social performance has been a hot topic in microfinance circles over the last 15 years. Previously, it was common to assume that if customers returned for subsequent loans, that this was enough of an indicator that the loan programs were working and that clients were happy. But with the proliferation of microfinance institutions around the globe, and the growing sophistication of donors and social investors, this method of gauging social impact ceased to cut the mustard. People wanted to really know if these programs were having an impact or not, and maybe even how much.

There are a million different approaches that MFI’s have taken to evaluate how good they are at encouraging development, some internally focused (evaluating mission statements and procedures), some externally focused (long client surveys about how use their loans).

Here in La Paz, I am working on two things: measuring the poverty levels of clients and getting feedback from clients about what’s working for them and what’s not. To accomplish the first goal, I am helping FONCRESOL to implement a tool called the Progress out of Poverty Index. This tool was developed by the Grameen Bank and I think it’s really interesting and useful.

Basically, the tool involves giving clients a poverty score. This is done using a short survey which is tailored specifically for different countries. The questions, such as “What material is your floor made of?” or “What type of fuel do you use for cooking?” are multiple choice and responses are easily verifiable by staff (which ensures the integrity of the data). Points are assigned for each answer and the tallied score can be translated into a likelihood that the client lives under a certain poverty-level (for all my nerdy econ friends, the scores are calibrated to various poverty lines using national household survey data and a logit regression). When the tool is administered over a population, the percentage of that population living under a certain poverty-level can be estimated. Cool, huh?

While this information is pretty basic, it’s also pretty useful. The goal is to integrate the tool as part of the loan application process so that data is gathered for every loan. With this information one can observe a couple important things:

1) How poor is the average client? How poor is the average new client? This is important information to make sure the services are reaching the intended population. Lending to (relatively) rich people doesn’t do much good if your goal is to reach the poor.

2) Does the client’s poverty level change after each loan cycle? This is where one might be able to crudely measure social impact. By tracking changes in the poverty level of clients over time, this is one way to observe impact. (I’m going to pre-empt my nerdy friends by admitting there is an identification problem here. Clearly, without a measurement of the counterfactual, causality cannot be determined. However, I’d argue that this information is still valuable to management, and given the small cost of implementation, is a great first step).

The other thing I’m working on is developing a program of client satisfaction focus groups. In addition to finding out what’s working and what’s not (from the perspective of the clients), this tool will also increase the amount of client input when it comes to program design and management decisions (which I believe is valuable in and of itself). I don’t really have much more to write about that (it doesn’t exist yet), but this post is already really long and conducting these focus groups in the different regions that FONCRESOL serves (five in total) should make for some good blog material in the future.

So that’s what I’m doing.

Pre-depature Stories (or Some Reasons I Love Canada)

For those of you who either don’t know me or didn’t read the side bar, my name is Dan and I’m working with a microfinance institution in La Paz, Bolivia. Before I get too much into that, I thought I’d start the blog off with a few pre-departure stories.

I applied for this position while I was working for a little tourist publicationin Oaxaca, Mexico (I made their website and wrote some articles about food). As an unabashed junky for Canadian politics, spending the last federal election in Mexico was a bit of a painful experience. When the bad guys won, I would often hear about the reluctance of my travel partner to return home until the country had come to its senses. I was/still am less pessimistic.

It wasn’t until a few weeks later that I would be kept up at night by thoughts of self-imposed exile. If the Canucks had won the Stanley Cup, I simply could not have beared returning to Canada until a different champion had been crowned.

A few weeks later, I was hired for my current position and it was time for me to come home to do some training (thank you Bruins for making it easier on me).  I took this opportunity to also see some friends and family from across the country. I hadn’t originally planned to do as much as I did, but in the end I can safely say that I had a great Canadian summer adventure.

In six weeks, I managed to visit six cities in four provinces: Vancouver, Victoria, Edmonton, Toronto, Montreal and Ottawa. Add to that one gulf island and two Ontario cottages. It was quite a trip, and I thought I’d share some of the experiences that really cemented my affection for my country.

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Let’s get the obvious out of the way: natural beauty, I saw a lot if it. Sunny days on Kits beach in Vancouver, sunsets on Gabriola Island and driving through Algonquin Park, the sandy beaches of Georgian Bay and mid afternoon drifts down the river in Bayseville, ON. Canada is beautiful. Duh.

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When I go home to Edmonton I can count on two things: beef ribs and dim sum. Satisfying the latter, my dad brought me to a restaurant which, to me, stands as stunning example of multiculturalism in Canada. Located next to the lobby of a Howard Johnson Hotel, half the space is dedicated to an Albert’s Family Restaurant and half is dedicated to the dim sum joint.

Late on this Wednesday afternoon, while enjoying our pork buns and steamed tripe with ginger and green onion, I tried to imagine what the place would look like on a Sunday:

One side is filled with large round tables, each seating four generations of a Chinese family who chat and slowly pick at variety of steamed and fried dishes from a lazy Susan. The other side is occupied by long rows of tables filled with noisy, sweaty children, fresh from their novice hockey game. Coaches and parents at the end of the table watch the kids demolish their eggs and bacon quickly so as to try their luck winning a plush toy from the claw machine.

I also imagine there is at least one child who is conflicted about the table at which he should sit.

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Montreal a.k.a. Canadian food Mecca. Over the course of three separate trips to Montreal, I managed to eat four Schwartz’s sandwiches (one of which was my last Canadian meal) and three poutines - each delicious. One poutine, from La Banquiste, had steak and onions. It was awesome. The other two were from my favourite place in Montreal: PatatiPatata. If you only eat poutine once in your life, make sure it’s from here.

While the smoked meat and poutine are Montreal favourites, my most memorable meal was eaten at La Khaima. In town for a seminar, our group of 12 was seated at a low, long table. Pillows were substituted for chairs and shoes were verboten.

Our lack of familiarity with Mauritanian food was no problem, as we only had to identify how many vegetarians were among us and our friendly, exuberant host took care of the rest. We started with a spicy dip made from onions, carrots and tomatoes accompanied by warm pitas. For a main course, the vegetarians were served a chickpea, potato, onion and tomato stew. Non-veggies were treated to a spicy chicken tajin as well as lamb sausages. Each dish was served on giant communal platters with copious amounts of delicious couscous. We washed down each delicious bite with cold, sweetened hibiscus tea with mint.

For dessert, we were treated to a sorbet, flavoured with a specially-imported fruit, the name of which escapes me (I had never seen it before). It was similar to tamarind, but less sour, delicious. The meal wrapped up with hot sweet tea which fortified us for the rainy journey back to our hotels.

Mauritanian food…. Who woulda thunk it?

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Honourable mention (from west to east): Well-appointed caesars in Victoria, tongue tacos in Vancouver, “Yummy Pork” (Korean) in Toronto and pho in Ottawa (Saigon Boy is my new fav). Oh, and I also got to see some pretty awesome live music, too.

I guess this is a good first post because it mentions the things I’m most interested in: politics, hockey and food.

But I would be remiss if I failed to mention the great family and friends I have from coast to the middlish of the country (I’ll get to the East Coast someday). You were the real highlights of my trip. While I may be gone a fair bit, I’m always cognizant of how lucky I am to have what I have in Canada.

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Now I am in Bolivia. The rest of my posts will be about Bolivia. I swear.