Peer Pressure for Good: Applying Peer Learning to Governance Leadership

> Posted by Madeleine Dy, Program Specialist, CFI

The Investing in Inclusive Finance program at the Center for Financial Inclusion at Accion explores the practices of investors in inclusive finance. Across areas including risk, governance, stakeholder alignment, and fund management, this blog series highlights what’s being done to help the industry better utilize private capital to develop financial institutions that incorporate social aims.

“What does he know that I don’t know?” This is exactly the question proponents of peer learning want to provoke. In academia, peer learning has received significant attention and new peer learning communities are sprouting up around the world. From the virtual Peer 2 Peer University, or P2PU, which was founded in 2009, to the Indian non-profit Avanti with its peer Learning Centers in India, to more informal community-driven websites like Skillshare where anyone can teach anyone else about a skill.

The Center for Financial Inclusion at Accion (CFI), the Boulder Institute of Microfinance, and Calmeadow Foundation are applying the power of peer learning in our upcoming “Governance Leadership in a Competitive World” seminar in Mexico City on October 3-4, 2013. The seminar asks MFI board members and CEOs to come together to address governance and risk challenges microfinance institutions are facing. The seminar will employ a highly interactive combination of case-based peer discussion, experienced industry speakers, and problem-solving.

Peer learning actually isn’t a new concept. It had its birth around 1916 with education thinker John Dewey’s Constructivist Theory which asserts that knowledge is created through experience, rather than through the usual teacher to student lecture and memorization. Paulo Freire, the Brazilian development guru, took it a step further with his 1968 book Pedagogy of the Oppressed, which critiques traditional teaching frameworks that treat students as empty vessels into which knowledge is deposited. Freire challenged society to ensure that all participants in the classroom, both teachers and students, work together to create knowledge equitably.

In the early ‘90s, researchers identified 10 different models of peer learning, such as student tutoring, a buddy system for counseling, peer-assessment, discussion seminars, and workplace mentoring. Peer learning has come to be defined as a two-way, reciprocal learning activity, with the involved parties mutually contributing to each other’s learning. Peers are people of equal status in a similar situation and with similar goals. Their experience and expertise can differ, which makes the interaction, discussion, and learning richer. In the case of the Governance Leadership seminar, the peers are the MFI board members and CEOs.

David Boud, Emeritus Professor of Adult Education at the University of Technology Sydney, says that, “Peer learning should be mutually beneficial and involve the sharing of knowledge, ideas and experience between the participants.”

Other recognized benefits of peer learning are that the participants develop skills in working collaboratively with others and in giving and receiving feedback. In addition, there is the emotional support component that learners provide for each other, which can be as powerful and important as the technical knowledge learned. The support component presents itself most strongly when discussing challenges and receiving validation, solidarity, and/or advice on how to address it. The Power of Peer Learning: Networks and Development Cooperation also recognizes the value of peer pressure for encouraging accountability, self-assessment, and transparency.

The Corporate Executive Board (CEB) uses a model built on learning from peer perspectives and networks, highlighting the profile of senior leaders which peers can compare themselves to and thereby recognize ways to improve.

The Governance Leadership seminar aims to incorporate all of these lessons into its pedagogy. It will feature facilitators who are industry leaders in microfinance with expertise in governance and risk. These facilitators will engage board members in an active dialogue about governance challenges and their roles as directors. It will address risk reduction and crisis management strategies necessary at the board level. These activities leverage participant experience and provide the opportunity to observe best practices, exchange ideas, and apply key takeaways to strategic operations. Case exercises will highlight the greatest risks MFI boards face, including weak management, excessive growth, and a highly competitive environment, and will be used to spar discussion about the appropriate board responses to those risks. The seminar will provide board members with opportunities to interact with others within their geographic context and facilitate greater understanding of the regional challenges that frame the risks MFIs confront today.

With insights on governance and risk management developed through discussions with their peers, board members will have improved capacity to oversee their microfinance institutions, and this will ultimately result in better services for their clients.

If you would like more information on the Governance Leadership in a Competitive World seminar, or would like to attend, please check out the brochure.

Have you read?

Staying the Course When Risks Rise: Advice for Board Members

Ten Risk Questions for Every MFI Board

How Can MFI Boards Be Explicit about Risk Strategy and Appetite