Ideas to Action:

Independent research for global prosperity

X

Views from the Center

Feed
Several CGD senior staff, including CGD president Nancy Birdsall, are among the more than 160 senior development professionals and experts who have signed a joint letter urging reform of the leadership selection process at the World Bank and the International Monetary Fund. Excerpts:
Paul Wolfowitz’s problems at the World Bank stem in part from a widespread perception that he disproportionately represents U.S. interests rather than objectives that command a global consensus. The root cause of that perception is an informal convention, established in the 1940s, that the U.S. government designates the president of the World Bank while European governments designate the IMF’s managing director. In today’s world, that outdated convention should be abandoned and replaced with selection procedures that reflect two key principles: transparency of process, and competence of prospective leadership without regard to national origin. With such selection procedures, the heads of the institutions would be seen as representing the international community as a whole, not a single country or region. If the outdated convention is not abandoned, the leadership crisis at the World Bank is unlikely to be fully resolved even if Paul Wolfowitz decides to resign. We therefore call for timely adoption of reform of the selection procedures at both institutions. We recommend as an initial constructive step that European governments and the U.S. administration publicly state that the 1940s convention should be jettisoned and commit themselves now to reform selection procedures whenever new leadership choices have to be made for either the World Bank or the IMF.
The call for leadership reform is in keeping with a CGD working group report released nearly two years ago when Paul Wolfowitz took office as the new president of the World Bank. The report, The Hardest Job in the World: Five Key Tasks for the New President of the World Bank included a recommendation that the then new president take the lead in establishing a more open, competitive and transparent process for selecting his successor. As the report explained, the existing selection process:
... gives the U.S. administration unchecked discretion in the timing and process for selecting presidents, undermining the sense of ownership that ideally would be shared by more member governments in an institution at the center of a shared global goal to reduce poverty. The point, however, is not fundamentally about nationality. It is that the selection process should be transparent (similar to what the Bank advocates regarding countries’ governance), and that it should draw from the global talent pool.
To which I say, Amen! The old Chinese saying that crisis is another word for opportunity has rarely been more appropriate than in The Current Situation (TCS) confronting the Bank shareholders.

Disclaimer

CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.