Citi: In 2008, the Foundation re-evaluated its strategy and results from prior years and realized that while we could report on numbers of people reached through our giving, we were really tracking activities, not the impact we were trying to achieve.   Foundation staff worked with local community development officers, consultants, and our grantees to develop a system to define and track results from our grant investments. After three years of hard work, we are now using the system and are learning – with our grantees – how to use these indicators to jointly share ideas on what works and why.

CECP: Can you explain how the measurement system works?

Citi: The essence of our results-oriented measurement framework is that we seek to track outcomes, not activities or process.  So if a grantee has committed to do financial education training, what we care about is not how many people went to training or can pass a test, we want to know how many people have reduced their debt or increased their savings.  Not only does this help us understand if this grant is achieving real results, it also helps us and our grantee together to understand what works and how to make it better. 

CECP: What have been some of the greatest challenges in implementing this system?

Citi: A significant challenge was to build trust with our grantees and assure them that this shift was not designed to offer a pass/fail grade at the end of the grant cycle but rather was a systems change designed to appraise our impact as a Foundation and to build the capacity of our grantees. We want to know that the programs we are supporting are clearly contributing to our financial inclusion strategy and give us data that we and our grantee together can evaluate and use to improve results.

Secondly, this approach has challenged us to shift our thinking about process.  As grant makers, our instinct is to assess a work plan submitted by a grantee and then measure the desired outcomes by numbers. We still care about numbers.  But the numbers we’re interested in are the outcomes for the individuals we’re helping, not the activities that our grantee is engaged in.  We find ourselves inverting our due diligence by first asking what is the outcome we want and then determining if the work plan created can actually achieve it.

CECP: Now that you are three years into this effort, what have you learned and how has this changed how you evaluate initiatives to support or partners to engage?

Citi: Since the approach of this framework increases the ongoing dialogue with our grant partners, it allows us to ask them the kind of focused questions that result in an honest and thorough program evaluation.  As a result we have learned key lessons about the positive gains that accrue for individual participants and communities; how the organizations are transforming and how their work is informing change that includes influencing policy or changing practitioner practices.   Some of the results are immediately clear while other outcomes may not be seen for years, but we are confident that this is a sound way to achieve financial inclusion.

CECP: Can you offer us an example?

Citi: Sure, let’s take a look at one within our Financial Capability and Asset Building portfolio in the United States.  In 2004, Citi made a 10-year, $200 million commitment to meet the financial education needs of low income consumers in the communities we serve, which we completed in 2010 ahead of schedule. In assessing this commitment, we realized that while increasing financial knowledge is important, helping low income consumers establish positive financial behaviors is critical to achieving long-term, sustainable results. This is why we not only changed our strategy but we changed the terminology we use from “financial education” to “financial capability.” 

Today, we support programs that offer low income consumers appropriate help in developing and maintaining forward-looking financial behavior.  Through one of our established partners, NeighborWorks America, we made a $5 million investment  that provides training, capacity building and intensive evaluation to 31 organizations seeking to strengthen their financial capability coaching programs.  These organizations are focused on helping people acquire financial knowledge and skills and apply them to change their financial behavior over time. Additionally, the organizations have access to NeighborWorks’ proven Success Measures Data System allowing them to conduct real-time evaluation of how the financial behavior of their clients is changing.  This demonstration project allows for tracking a consumer’s ability to develop financial behaviors that result in increased savings, less debt, improved credit and ultimately, a sense of control regarding their finances.

CECP: Do you feel you now have a better understanding of what you are accomplishing?

Citi: Absolutely, we now have a very clear sense of what we are focused on and how we achieve our objectives.  But it is hard for all of us to focus on results instead of all the wonderful things we have done.  However, we believe it is helping us to focus on how we are impacting real people and understanding what works and why.  We now are able to seek out opportunities where our grant funds can clearly contribute to fostering new innovative solutions to move the financial inclusion field forward; generate long-term impact; and most importantly, provide opportunities for knowledge building and replication.

CECP:  What are your expectations for how this system will guide your investments in the future?

Citi: We are doing three things: working with our grantees to understand outcomes and use this knowledge to improve programs; use metrics to describe to our Board how we are fulfilling our fiduciary obligation to use funds wisely; and finally to communicate – internally and externally – how many new businesses we have helped create; how many people have increased their savings and reduced debt; and how many low income and first generation students have acquired a college degree.  

CECP:  So what's next? 

Citi: In addition to working to transform lives, we’re deeply invested in thought-leadership that results in systems-change, to help the financial inclusion field better understand the balance of this equation.  The "what's next" for us is to determine how to effectively measure these valuable contributions.  At times it’s complex, but it’s always exciting work.

To learn more about the Citi Foundation, visit www.citifoundation.com