Member Connections

Interviews with Candidates for President of World Bank

The Board of Executive Directors of the World Bank will conduct interviews with the three candidates in Washington, D.C. The schedule of interviews has been agreed with the candidates based on their availability:

Ngozi Okonjo-Iweala on Monday, April 9
José Antonio Ocampo on Tuesday, April 10
Jim Yong Kim on Wednesday, April 11

The Fifth anniversary sixty years on…
Several names in the five-year anniversary issue show how new the Bank was when it first interviewed me. That was in 1960. Military service and the Algerian war were still ahead of me, but the Bank sent me occasional reminders, and then a final offer while I was still in Algeria. I accepted and six weeks after returning to civilian life my wife and I sailed in grand style on SS France. Of course, in first class, and in company with a very well-known lady: Mona Lisa on her way to the National Gallery. The contrast was gratifying with my previous sea voyage, crossing the Med in the hold of the troop carrier Sidi Ferruch.

Yet first class travel for professional staff on business trips was not an exorbitant privilege in those days. I had briefly worked for a consulting firm in Paris after my return from Yale, awaiting my military call-up, and I had flown first class on mission. Nor was my starting Bank starting salary particularly attractive. While still in uniform in Algeria, I had agonized over the Bank’s offer of $ 6600 a year. This was rather lavish compared to the approximately $ 15 per month the Army was then paying me in Algeria (more so compared to the 30 centimes a day – less than $ 2 per month – of the draftee’s pay during the first 18 months of military service), but it seemed ungenerous compared to the $ 400 a month I had earned as a summer research assistant in New York three years earlier. Then, just before we sailed, the Bank wired that I “would be interested to learn” that my annual salary had been adjusted to $ 7500.

My two interviewers in 1960 had been Mr. Ruczinsky and Leonard Rist; the latter was still, as at the time of the Five Year Issue, Director of the Economic Department. Later correspondence was signed by Don Fowler, Personnel Manager, who was also the first person I saw when I arrived at 1818 H Street in December 1962. The Anniversary issue’s masthead mentions him with the same title.

Lacy Carter is also already on the masthead in 1951; she remained in charge of “support staff “ for several years after I joined. I remember a memorandum of hers in which, a good many years later, she warned secretaries against wearing unsuitably short skirts. This prompted Fay Sommerfield, head secretary of the East Asia Department, to muster all the department’s women in exceptionally short skirts while the Director, Peter Cargill, paraded with a yardstick. Such concern with appearances will seem strange to many present staff. It may seem even odder that newly joining bearded professionals were asked to shave, and only a few resisted. I heard (but cannot vouch for the story’s truth) that when the first Sikh joined, it was decided after heated debate that, his beard being religiously motivated, Staff Relations should raise no objection. And there was a Swiss, who joined at about the same time as I; he bicycled to the Bank and was told by Staff Relations this was not quite in keeping with the standards of behavior expected of Bank Professionals…

Mme. Cornioley, also mentioned in the 1951 Anniversary Issue, was still in the Paris Office twelve years later. And, of course, Eugene Black was still President when I joined. Staff had grown since the 1951 issue, but modestly – it held in two buildings, the original 1818 H St, and its neighbor, the B or, colloquially, “new” building. Every few months, the half dozen or so new professionals were welcomed into the fold at a dinner, hosted by one of the two Vice-Presidents, Harold Wilson or Burke Knapp – the latter would stay on until the late 1970s. This custom was allowed to peter out soon, during the first great expansion of Bank staff under George Woods.

Recruitment processes, staff rules and benefits had all aimed at building for the Bank a permanent cadre of long-serving staff, an international civil service. Back in 1960, the specialized bureau of the French foreign ministry through which the Bank had contacted me had warned that I should make a long-term commitment. They would not have been surprised that I would actually stay on for thirty-two years. In the old process, merit did not always find its proper recompense; some were unduly held back, while others reached and were maintained at their level of incompetence. But on the whole, this process produced intense dedication and loyalty. These cannot be expected of staff who, as is apparently current practice, are hired for short fixed terms only. No doubt, this gives more flexibility. Yet the Bank’s work reaches its final developmental results only after decades. Meanwhile, progress consists of intermediate steps only, the assessment of whose achievements is necessarily subjective. I doubt that overall efficiency has gained from the two-way loss of long-term commitment.

Jean Baneth
World Bank December 1962 – December 1994

Dear 1818 Society Members:

Over the last few months, I have been publishing a blog about my experiences working at the World Bank as well as perspectives on how to increase the institution’s transparency, accountability and effectiveness. The blog has been noticed by many in the development community including members of the society. Recently, one member suggested I offer some thoughts via the Members Connection page. I am pleased to do so and am interested in hearing your thoughts at any point.

David Shaman
author, The World Bank Unveiled: Inside the Revolutionary Struggle for Transparency

What are Some of the Structural Inefficiencies of the World Bank (Part 1)

One well-known aphorism that has circulated the halls of the World Bank over the years is it is generally less than the sum of its parts. Part of this tongue-in-cheek observation is based on a cynicism that can grow within any bureaucracy. However, with regards to the Bank, it is also based in part on the cold reality of its unique environment. From personal experience and research conducted for The World Bank Unveiled, I have identified a number of structural inefficiencies that keep the Bank from reaching its full potential in achieving its poverty reduction mission. Here are four key ones:

1.Senior management sculpts visionary reforms to tack with the geo-political pressures of the Bank’s member countries, external watchdogs, media and the evolving global financial and economic environment. This has led senior officials to engage in regular reorganizations, but to implement reforms they must rely on the institution’s mid-level management. As these external pressures have grown, the information revolution and a heightened interconnectivity of the global economy have reduced the amount of time senior officials have to react. As a result, their reliance on mid-level management to implement these reforms has increased. Concurrently, mid-level management is in reality a culture of fiefdoms. The internal culture of the Bank, hardened over six decades, rewards managers for conservatism and adherence to the status quo. So, these fiefs are wedded to maintaining the status quo as a strategy for advancement and accruing power.
2.The institution is layered with a rigid hierarchy. The separation between senior officials and staff is stark and ingrained. Such an environment creates warped perceptions and information vacuums. Senior officials, focused on the big picture, are often given a skewed view of how things actually operate at the staff level. Problems and potential problems become hidden as accurate information often fails to move up the chain of command. Additionally, senior management’s intense desire to not receive unpleasant information results in an institution-wide fear of candor. Finally, these behaviors are exacerbated by one of the native instincts of the institution’s fiefs – an aversion to information sharing and transparency.
3.The Bank’s culture is one that disdains selectivity and embraces the notion it must do many things well. As a result, staff is continually addressing new challenges, engineering temporary fixes, and moving on to the next problem. Since it tries to do everything, preventable failures are inevitable and activities it pledges to support are not always funded.
4.Institutional hypocrisy, a theory espoused by Robert Wade of the London School of Economics, occurs when the Bank tries to “control its external environment and manage the contradictory demands being made by states, NGOs and firms.” The Bank provides actions/services and talk. Clients and customers value its services. Spectators and watchdogs values what it says. The disconnection between the two is common and real. Wade provides examples. One includes: “increase the density of declarations and policies designed to satisfy and pacify spectators and watchdogs, and increase its promises to bring its actions into line with its policies, while not making the corresponding resource allocations.”
These observations are not to say the World Bank does not do some things well or to impugn the motives and actions of the dedicated professionals who work there. However, my experiences suggest these structural inefficiencies are systemic and have led to both unsound decisions and a failure to learn lessons from failure.

This is the third of a series of blogs on the World Bank and transparency, accountability and reform issues. I invite you to share your own opinions with a wide community of international development practitioners and interested readers here or at http://theworldbankunveiled.wordpress.com/.

Dear 1818 Society Members:

Over the last few months, I have been publishing a blog about my experiences working at the World Bank as well as perspectives on how to increase the institution’s transparency, accountability and effectiveness. The blog has been noticed by many in the development community including members of the society. Recently, one member suggested I offer some thoughts via the Members Connection page. I am pleased to do so and am interested in hearing your thoughts at any point.

David Shaman
author, The World Bank Unveiled: Inside the Revolutionary Struggle for Transparency

Is Reforming the World Bank Possible?

In April 2009, the G-20 pumped funds into key international financial institutions (IFI) such as the IMF and Bank to mitigate damaging effects of the global economic downturn on the most vulnerable developing countries. Estimates from international organizations, including the Bank, indicated the crisis was returning tens of millions of people back into abject poverty. The G-20’s decision and the impact of the crisis have heightened pressure on the Bank, both from a political and a humanitarian level to achieve results. It has also provided a new opportunity for critics of the Bank to call for reforms.

For years, developing countries have wanted more say in Bank decisions. External watchdog groups have urged the Bank to reform its internal governance and information disclosure policies. One outcome of the global economic crisis has been to successfully pressure the Bank into implementing internal reviews for both areas. The results have been mixed.

In July 2010, the Bank implemented a new “Access to Information” disclosure policy. The new policy was formed after significant consultation with civil society actors and key external players have praised the result. Most notably, the Bank has shifted from a “positive” list to a “negative” list: There is a presumption of publicly disclosing a document unless it is classified as an “exception” instead of listing document types that can be disclosed and nothing else. Another important advance is the ability of external stakeholders to appeal for disclosure after a document has been classified for non-disclosure.

Nevertheless, watchdog groups believe there are gaps in the new policy. Draft documents are considered “deliberative” and as such can be considered an exception for disclosure. Moreover, member governments and Bank contractors can veto the disclosure of documents, there are limitations on the appeals process and access to documents from Board of Executive Directors remains largely unavailable or available only after many years. On balance, many observers view the new policy is seen as a step forward for the Bank in terms of its transparency – and one that should be acknowledged – but also as a journey yet to be completed.

In late 2008, the Bank launched a commission to examine internal governance reforms. The commission, chaired by former Mexican president Ernesto Zedillo, made its recommendation in October 2009. The commission offered a number of suggestions, but the Bank’s enthusiasm to embrace them can be best characterized as lukewarm. (One notable exception is, in light of the global economic crisis, the commission supported strengthening the Bank’s resource base and the institution has moved aggressively to secure its first major capital increase in two decades.)

The Bank did move to give more voice and vote power to developing countries this past spring (a commission recommendation), but the change was incremental and the 50-50 split sought by many development think tanks and NGOs remains years away. Interestingly, the Bretton Woods Project, a UK-based NGO, said its analysis indicated voting power for low-income countries may have even declined. The concept of a transparent and merit-based selection for the next Bank president – and possibly a non-American – has stagnated for the time being. It could be DOA given reluctance within some U.S. circles, but only a succession process may actually provide the true impetus for whether this informal policy will change.

These developments suggest change can happen. When it does it is usually the result of large forces pressuring available fault lines. However, when change does occur, it tends to be incremental, moving with sudden lurches and equally sudden periods of stillness. My experiences in the Bank suggested drivers of change were opaque. From my vantage point as an internal reformer, operating from within the organization offered opportunities not available to outsiders. On the other hand, it also imposed limitations. There were times when I came to believe true change must come from external forces. As it turns out, both suppositions may be wrong. Perhaps the will or efforts of internal or external reformers is not enough. Only some tectonic shift of the world order can force the Bank or any IFI to reform. The lesson of the global financial crisis may be that it may take an international crisis of some magnitude to shift the Bank’s thinking about its internal governance and accountability mechanisms.

I invite you to share your own opinions with a wide community of international development practitioners and interested readers at:

http://theworldbankunveiled.wordpress.com/