Assessing Ethical Microfinance: The ADDO Framework

The table below presents M2i's ADDO framework for assessing ethical lending by Microfinance Organizations. The ADDO framework has been developed by drawing on our interactions with over 50,000 microfinance clients and over 100 MFIs through our various engagements over the past four years. It gives us great satisfaction that SIDBI (the pioneering financial institution that seeded microfinance and helped greatly in its evolution) as well as Sa-dhan (the premiere network organization in the microfinance sector) are utilizing this framework in their Code of Conduct Assessments.

Approval (A)	Documentation (D)	Dissemination (D)	Observance (O)
Has the board approved the policies covering these codes of conduct principles?	Have the guidelines that follow from these policies been documented in the appropriate manuals?	Have the guidelines been disseminated across the organization through training and making available guidelines and manuals at the branches?	Are the guidelines observed in practice as found through interactions with a sample of clients?
Client origination	Client origination	Client origination	Client origination
Loan pricing	Loan pricing	Loan pricing	Loan pricing
Loan appraisal	Loan appraisal	Loan appraisal	Loan appraisal
Client data security	Client data security	Client data security	Client data security
Staff conduct	Staff conduct	Staff conduct	Staff conduct
Client relationship and feedback	Client relationship and feedback	Client relationship and feedback	Client relationship and feedback