The year 2008 was one of historic change and dynamic accomplishment. Yet, when retrospectives of 2008 are written, they will undoubtedly center on the warning signs and fourth-quarter collapse of the global financial system. Similarly, the microfinance sector reflected this dual sense of opportunity and crisis in 2008. More than $11 billion of capital flowed into the sector, allowing providers to reach more than 155 million clients with a broader array of products and through a more diverse set of channels. Despite these advances, by the end of the year most MFIs were revising their growth projections downward in the face of liquidity constraints and the first signs of weakening portfolio quality. At Women’s World Banking we made significant changes to our governance and network membership to reflect best practices and work more effectively with our network in the face of these realities. In particular we began three initiatives as we embarked on our 2008-2010 strategy to become the pre-eminent voice for women in microfinance:

Commercialization and Women: Commercialization of microfinance, leading to the growth of MFIs, spells hope for those still unbanked. But what happens to poor women clients when institutions align their interests with those of profit-seeking investors? The resulting trade-offs are examined in a WWB publication, “Stemming the Tide of Mission Drift: Microfinance Transformations and the Double Bottom Line,” that warns of the steep drop in the percentage of women clients as MFIs transform into for-profit entities. See our network’s recommendations on how MFIs can stay focused on their social mission on page 10.

Building Future Leaders: Another unintended consequence of commercialization is the marked decline of women staff at all levels of MFI operations. In response, WWB created a diagnostic approach, the Organizational Gender Assessment, to help MFIs identify and rectify internal constraints to gender diversity. We present some findings of the assessment we completed with ASA in Bangladesh, one of the world’s leading MFIs, and the organizational changes it implemented to build an even more meritocratic institution. See page 12 for findings of the assessment we completed with ASA in Bangladesh.

Expanding our Network: In spite of our sector’s enormous gains, more than 1 billion people still lack access to any financial services. In 2008, WWB expanded our network to make a small, but deliberate, step toward closing that gap. In 2008 we proudly welcomed WWB Ghana, PEACE (Ethiopia) and Ujjivan (India) as new members.

The theme of this annual report is Investing in Women, Transforming Lives. All of WWB’s offerings focus on our members’ women clients. This year, we gave them tools to focus on women staff and leaders as well. I invite you to read about the investments we are making in women and glimpse the ways in which the WWB network is transforming the lives of millions of poor women and their families. Mary Ellen Iskenderian, President and CEO, Women’s World Banking.

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