Standard 2c

Employee recruitment and evaluation are based on both social and financial performance criteria.

From the moment they are hired, your institution should instill its values in new employees, and encourage these through routine training and balanced incentives. Use these resources to build commitment to your social objectives and responible treatment of clients among staff.


Guidance on Standard 2C

Imp-Act SPM Practice Guide: Chapter 7

This chapter addresses how human resources supports balanced performance management. Relevant here is the section on page 123, which focuses on how financial service providers (FSPs) can ensure that new staff share in their mission. Also review the section on page 124, which focuses on the role of staff training in ensuring commitment to the FSPs mission.

Imp-Act Guidance Note on Staff Incentives

This briefing frames the key questions to consider when reviewing an FSPs staff incentive system. It then identifies some emerging practices that FSPs are finding helpful in ensuring that the staff incentive systems appropriately balance their social and financial performance objectives. 

Balanced Incentives for Frontline Staff: A Tool for Financial Institutions

This Smart Campaign Tool discusses the importance of balanced incentives, meaning incentives that balance financial performance (e.g., portfolio growth) with strong client protection practices (e.g., respectful treatment of clients). Providers can use this tool to improve their own incentive system for frontline staff.

Incentives in Microfinance: Lessons Learned on Effective Incentive System Design
This Accion “Lessons Learned Brief” highlights best practices from Accion partners in developing and implementing staff incentive systems.

How to Develop an Institutional Code of Ethics

Establishing high standards of ethical employee behaviour is a two-part process; first, the provider defines standards of behaviour, and second, those standards are brought to life throughout the institution. This guide focuses on the first part of the process—defining standards of behaviour through a formal Code of Ethics.

Tools and Templates

Recruitment and Selection Module: Grameen Foundation Human Capital Hub

This multi-part toolkit discusses the importance of recruiting and selecting employees who fit with the FSP's mission and strategic goals. It includes many practical tools, including interview guides and sample job descriptions.

Collections guidelines for financial service providers

This is a useful checklist for providers to assess their collections policies and practices, with the goal of strengthening client protection during the collections process. The tool addresses collections policies, practices, manuals, and training of field staff. For each of these topics, a provider can compare “good practice” with its own practice, and identify areas for improvement.

Smart Campaign Sample Client Protection and Ethics Codes

The SMART Campaign has compiled a list of codes of ethics from providers around the world, which are available for organisations to download and adapt.

Case Studies

ADRA Peru: Recruiting and selecting mission-driven staff

ADRA Peru's Microfinance Programe staff recruitment and selection process aims to: be in line with the Universal Standards for SPM, minimise the risks related to staff selection, identify staff that share ADRA’s philosophy and are dedicated to its social mission, and contribute to decreased staff turnover. This csae study describes the process they put in place to achieve this.

Muktinath Bikas Bank group training manual: Supporting informed client decisions

Muktinath’s pre-group training (PGT) manual describes the training provided to its potential clients to introduce them to the provider, its work, products and services, rules, the importance of credit discipline and the benefits of the group mechanism. The PGT Manual also helps loan officers facilitate the training in a way which is motivational, respectful and appropriate to potential clients’ capacity. Written by the CMF Nepal as part of the MFC SP Fund Project.

FinDev Azerbaijan: Retaining key staff through a “pay for performance” culture

This case study provides a practical overview of the process of developing and implementing FinDev’s staff performance appraisal system and salary compensation scheme (including that of senior management). Written by the AMFA Network as part of the MFC SP Fund project.

ABA Egypt Compliance with the Universal Standards in Dimension 2 and 6

This presentation gives a practical overview of the systems and processes that ABA Egypt has put in place to comply with each essential practice of Dimensions 2 and 6.