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Measuring social performance: reconciling the tension between commercial and social logics

Author

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  • A.K. Siti-Nabiha
  • Zubir Azhar
  • Salmi Mohd Isa
  • A.Z. Siti-Nazariah

Abstract

Purpose - The purpose of this paper is to explore the implementation of microfinance programs in three Malaysian development finance institutions (DFIs). Its main concerns revolve around how these DFIs measure and manage their social performance and how they reconcile their competing social and commercial objectives which are driven by particular logics. Design/methodology/approach - This paper analyzes the ways in which the DFIs selected for this study measure and manage their social performance. The data were acquired from two sessions of focus group interviews, a series of semi-structured interviews, and extensive reviews of documentaries. The institutional logics perspective is used to explore the interplay between social and commercial logics in shaping the view and use of social performance measures in the three studied DFIs. Findings - Although these DFIs have consistently offered formal microfinance programs to designated target groups, their ultimate focus has been on measuring financial as opposed to social performance. Hence, performance appraisal is mainly aligned with the breadth of outreach, rather than its depth. Nevertheless, there appear to be conflicts between the need to accommodate both breadth and depth, due to the competing demands of the two objectives. The rivalry between these two competing demands, which represents the interplay between social and commercial logics, is resolved through reconciliation, that is, by making one objective compatible with the other. Originality/value - This paper examines the ways in which the DFIs in the study measure and manage their social performance, a topic that is, currently, not widely explored. This study contributes to advancing the knowledge on the link between institutional logics and organizational practices, particularly in understanding the extent to which the Malaysian DFIs assign importance to social performance when designing and offering microfinance programs.

Suggested Citation

  • A.K. Siti-Nabiha & Zubir Azhar & Salmi Mohd Isa & A.Z. Siti-Nazariah, 2018. "Measuring social performance: reconciling the tension between commercial and social logics," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 45(1), pages 205-222, January.
    • Handle: RePEc:eme:ijsepp:ijse-08-2016-0216
    DOI: 10.1108/IJSE-08-2016-0216
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    Citations

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    Cited by:

    1. Mazni Asrida Abdullah & Azlina Ahmad & Nor Azam Mat Nayan & Zubir Azhar & Abd-Razak Ahmad, 2020. "Credit Risk Assessment Models of Retail Microfinancing: The Case of a Malaysian National Savings Bank¡¯s Branch," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 11(3), pages 73-83, June.
    2. Siti-Nabiha A. K. & Zubir Azhar & Mohd-Aatif Ali-Mokhtar, 2018. "Management Control for Microfinance: An Examination of the Belief System of a Malaysian Microfinance Provider," Asian Academy of Management Journal of Accounting and Finance (AAMJAF), Penerbit Universiti Sains Malaysia, vol. 14(1), pages 185-208.
    3. Kazemian, Soheil & Djajadikerta, Hadrian Geri & Said, Jamaliah & Roni, Saiyidi Mat & Trireksani, Terri & Alam, Md. Mahmudul, 2021. "Corporate governance, market orientation and performance of Iran's upscale hotels," OSF Preprints ajmvn, Center for Open Science.
    4. Agnieszka Karman & Viktor Prokop & Carlo Giglio & Fazal Ur Rehman, 2024. "Has the Covid‐19 pandemic jeopardized firms' environmental behavior? Bridging green initiatives and firm value through the triple bottom line approach," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(1), pages 375-395, January.
    5. Reginald Masocha, 2018. "Does Environmental Sustainability Impact Innovation, Ecological and Social Measures of Firm Performance of SMEs? Evidence from South Africa," Sustainability, MDPI, vol. 10(11), pages 1-11, October.

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