Artefacts of accountability: relationships, audit and ambitions in the Malawian microfinance sector
Cook, Hannah Kathryn
Accountability has become a prominent theme in the conversation around how international development agencies can best achieve their goals in an effective and ethical manner, and how they should seek to engage with their stakeholders. There is a growing consensus that what accountability looks like and how it is achieved varies significantly according to context, shaped by who the actors are, where they are working, and the nature of the intervention. This thesis presents an original, empirical study of accountability discourse and practice by focusing new attention on the global microfinance sector. Debates and controversies about the capacity of microfinance to reduce poverty in the ‘global south’ are pervasive, and, I assert, issues of accountability. I explore these issues through the questions I pose in this thesis of, for what are microfinance organisations accountable, to whom, and how? Through the in-depth, qualitative case study of one microfinance institution, Cloud Loan, this thesis extends our understanding of accountability and microfinance. Tracing day to day operations, interactions, and decision making from Cloud Loan’s headquarters in London to field offices in Malawi, the thesis argues that mechanisms of accountability are being co-opted to serve a performative role, in ways that legitimise rather than challenge existing practices and behaviours in the microfinance sector. As the thesis shows, microfinance organisations have come to hold themselves accountable for maximising income and keeping costs low, and often prioritise these ambitions above stated goals of social impact. Appeals to supporters and donors are predicated upon a lack of transparency: accounts are carefully constructed and selective, and key information is systematically withheld to create an appealing and expected narrative. Constructing and maintaining such artifice, as well as narratives of accountability, I argue, have come to occupy extraordinary time and resources, often diverting funds from alternative uses that are potentially more beneficial to those in whose name microfinance organisations operate. The thesis also argues that this lack of transparency cuts deeper and more widely across the Malawian microfinance sector, underpinning a culture of secrecy, conducive to inefficiency, and fraud. Such findings raise important concerns about whether microfinance interventions reflect the will and preferences of those in whose name they are being undertaken, and whether participating communities are being adequately protected. Beyond Malawi, this thesis offers an important reminder that – despite new forms of accountability - the logic and practice of global microfinance continues to demand critical attention.