Export-Import Bank:

Performance Standards for Small Business Assistance Are in Place but Ex-Im Is in the Early Stages of Measuring Their Effectiveness

GAO-08-915: Published: Jul 17, 2008. Publicly Released: Jul 17, 2008.

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The Export-Import Bank (Ex-Im) provides loans, loan guarantees, and insurance to support U.S. exports, and its support for small businesses has been a long-standing issue of congressional interest. Most recently in 2006, Congress required Ex-Im to develop, and GAO to review, performance standards for Ex-Im's assistance to small businesses, especially those owned by socially and economically disadvantaged individuals and by women. In response to the mandate, GAO evaluated the extent to which Ex-Im's standards address the functions referred to in the Export-Import Bank Reauthorization Act of 2006's (2006 Reauthorization Act) requirement for performance standards; how well Ex-Im is measuring its achievement of the standards, including those related to small businesses owned by socially and economically disadvantaged individuals and by women; and Ex-Im's use of performance information to improve operations and results.

Ex-Im's small business performance standards address most, but not all, functions referred to in the 2006 Reauthorization Act. Ex-Im developed 28 performance standards for its assistance to small businesses, ranging from providing excellent customer service to increasing outreach. We found that Ex-Im has performance standards relevant to most of the legislative functions, but the standards do not directly address some functions. For example, none of the standards directly addresses the function calling for increased outreach to businesses employing fewer than 100 employees. In addition, the standards address only some aspects of several functions. Ex-Im's performance measures generally address attributes of successful performance measures, such as clarity and linkage to goals, but 11 out of 27 measures lack targets and time frames to help decision makers evaluate progress toward meeting the performance standards. Additionally, Ex-Im has no measures to assess progress toward some standards. For example, while Ex-Im has established a measure for outreach to small businesses owned by socially and economically disadvantaged individuals and by women, it has no measure for monitoring progress toward its performance standard for increasing the amount made available to finance their exports. Ex-Im officials reported challenges to developing measures for financing exports by these businesses, such as the difficulty of obtaining reliable data. Ex-Im is in the early stages of compiling and using small business performance information. As an example of using this information to improve small business operations, Ex-Im officials cited raising limits on financing amounts for Letters of Credit, a type of guarantee, when customer feedback indicated an issue in that area. However, we found such examples are limited and Ex-Im has instituted few practices to date to ensure that small business performance information is used effectively. We previously reported on several practices that agencies can apply to enhance the use of performance information in management decisions, including improving the usefulness of performance information. To improve the usefulness of performance information, Ex-Im recently centralized its data analysis functions and is beginning to implement a new data reporting system; however, Ex-Im has no systematic processes in place for collecting, analyzing, and disseminating small business performance data.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: To more fully address the mandate in the 2006 Reauthorization Act regarding performance standards related to assisting small businesses the Ex-Im should establish standards specifically addressing those functions referred to in the 2006 act that are not directly addressed by its current performance standards.

    Agency Affected: Export-Import Bank of the United States

    Status: Closed - Implemented

    Comments: In response to the GAO recommendation, Ex-Im Bank has taken actions to more directly identify and track functions referred to in the 2006 Act. Specifically, Ex-Im Bank has taken steps to establish performance standards for most of the functions that GAO originally found it had not fully addressed. For example, with regard to the function related to outreach to small and rural companies that have not previously participated in its programs, Ex-Im has tracked outreach events in rural markets and also the number of its transactions for small businesses with fewer than 100 employees. While Ex-Im has taken actions to develop additional performance measures for its small business financing, Ex-Im can more fully document how it will integrate these standards into its strategic planning. The Export-Import Bank Reauthorization Act of 2012 (P.L. 112-122, section 4), requires Ex-Im to develop an overall business strategy. Ex-Im Bank officials said they are considering small business strategy issues as part of this process.

    Recommendation: To improve Ex-Im's ability to obtain critical information from its performance measures on how well it is achieving its performance standards to improve small business assistance the Ex-Im should review those performance measures which lack measurable targets and time frames and revise the measures to provide those elements, in the context of available information.

    Agency Affected: Export-Import Bank of the United States

    Status: Open

    Comments: The agency indicated in its agency comments or letter to relevant Congressional committees, 60 days after report issuance, that it concurred with the recommendation and planned to take action to implement it. GAO is monitoring or reviewing agency actions to implement the recommendation.

    Recommendation: With respect to its lack of performance measures for its standard of increasing financing for small businesses owned by socially and economically disadvantaged individuals and by women the Ex-Im should take steps to establish performance measures, such as through establishing a measure based on the estimated data it currently reports and identifying ways to improve the reliability of its data in this area.

    Agency Affected: Export-Import Bank of the United States

    Status: Closed - Implemented

    Comments: In response to our recommendation, Ex-Im has taken several actions. First, Ex-Im set performance goals for the dollar amount of authorizations for minority-owned and women-owned businesses for fiscal year 2011. (Ex-Im compiles information on progress toward this goal in its management reporting system and presents the information is its monthly internal report on key performance metrics.) In addition, Ex-Im has made progress since the report in increasing the data it collects regarding the number of applicants that are women and/or minority owned businesses by adding a question to its insurance, medium-term guarantee, and working capital applications as to whether the applicant's business was women-owned or minority-owned. With regard to its loan applications, an Ex-Im official stated that such questions had not yet been added to the loan application because the high dollar amount of most loans meant that such information would be collected during the extensive underwriting process; but Ex-Im is now working on consolidating all the data elements on its product applications.

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