Global Development: Views from the Center
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May 25, 2007
A Window for Reform of the World Bank President Selection Process: A Three-Year Term
Posted by Nancy Birdsall at 07:07 PM
Peter Goodman's article in today’s Washington Post (Wanted: World Bank President: Experience Required) suggests that the U.S. administration has learned an important lesson from recent events: the right experience and qualifications matter. In our survey of development community views on the selection process, majorities of the more than 600 respondents considered knowledge of development, effective management, international organization experience, and political and diplomatic experience to be “very important” to success in the job (in that order). Most judged a fifth criteria, experience in banking and finance, to be "somewhat important." (Two of the people identified in Peter’s article as "chief contenders under serious consideration" -- former U.S. Trade Representative Robert B. Zoellick and Deputy Treasury Secretary Robert M. Kimmitt -- are among nine scored in our survey. (Find out how they are doing and share your views )
The most striking result of the survey for me is the broad support for reform of the selection process. Even though more than half of the respondents identify themselves as Americans, fully 85 percent of all respondents either agree or strongly agree that "the U.S. prerogative to name the World Bank president and the European prerogative to name the head of the IMF should be replaced by a selection process that is open, competitive and merit-based without regard to nationality.”
My previous post with David Wheeler focused on the practical challenges of implementing these desirable principles. The question is: How do we get from the current arrangement to a selection system that increases the chance that a qualified individual with broad legitimacy will be selected as the president of the bank?
Goodman’s article makes clear that the U.S. administration plans to propose a single American candidate. Our survey--and my informal contacts with non-American diplomats and members of the bank board from other countries--suggest that there is a real desire for the U.S. to initiate a reform of the selection process for future World Bank presidents.
Indeed, there is a broad international consensus in favor of such reforms. A 2005 CGD working group report, The Hardest Job in the World: Five Crucial Tasks for the New President of the World Bank, prepared for then-incoming president Paul Wolfowitz, included reform of the governance of the bank itself among its key recommendations. Specifically, the report urged that the new president
Ask the governors of the Bank to formalize a credible, rule-based, transparent mechanism (as with private sector boards) for choosing the bank’s president.
Our report cited a 2001 joint report to the bank and IMF boards, originated by working groups set up by each institution, that outlined one possible mechanism. The report was then endorsed by both boards as guidance for future selection processes. In broad terms, the 2001 report advocated the creation of an eminent persons group that would develop a slate of candidates and provide assessments of each candidate to boards of the IMF and the World Bank, who would maintain responsibility for approving a presidential candidate.
This would be a big advance over the current arrangement. It does not speak directly to the question of whether the president of the World Bank must be an American and the head of the IMF a European, neatly side-stepping that contentious issue.
But such an approach is unlikely to be developed and implemented in the current crisis atmosphere surrounding the unscheduled departure of Paul Wolfowitz. At the same time, other World Bank member countries and a large majority of the Americans who care about international development are clearly eager for progress on the reform of bank governance. Some of these countries--especially the big emerging market economies such as Brazil, India, and China--will be reluctant to give a five-year term to a Bush administration appointee negotiated with the Europeans and presented to other members of the board as a fait accompli.
We have here the possible outlines of a compromise: The U.S. could proceed with the nomination of a single U.S. candidate for consideration by the board, with the clear understanding--in advance of proposing a specific individual--that the nominee will serve for the balance of Paul Wolfowitz’s uncompleted term, that is, for three years. The new president, who would commit in advance not to seek a second term, would have one central task besides keeping the trains running on time: to work with other members of the bank and with the U.S. administration to devise a reformed selection process for his successor that is broadly acceptable to the bank’s shareholders--the nations of the world.
Such a figure would need the trust of the U.S. president, and generous helpings of all of the skills and experience identified in our survey. She or he would play a role much like that of Mikhail Gorbachev in Russia, who presided over the transition from Soviet Communism to a more open, market-based system; or of Ernesto Zedillo in Mexico, who put in place the reforms that ended 30 years of one-party rule by the PRI.
It's hard to know now what the resulting new governance of the World Bank would look like. I for one believe that it would be best for the bank, for the U.S. and for development if Washington continued to play a prominent role. Whatever the outcome, the reforms called for in the 2001 report endorsed by the bank and IMF boards would finally be underway, the U.S. government would be free to focus on other urgent problems, and President Bush could claim initiating reform of the World Bank governance to make it more legitimate as an important part of his legacy.
It's one idea: a three-year term for the next president of the World Bank--with a commitment to reforming the selection process in a way that would establish the legitimacy of his successor. What do you think?
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Comments
The World Bank is an organization funded by our national governments and we should expect its president to be chosen based on merit, regardless of nationality.
The argument that the U.S. should select the World Bank president because they contribute the largest share to the Bank is fundamentally flawed. There are several developing countries, mainly in Asia, able and more than willing to increase their contributions, but which are presently not allowed to do so.
Finally, it is a mystery why there is not a single woman on the list of proposed candidates. Surely there exists at least one woman in the world, American or not, who is equally qualified to the men already on the list?
Posted by: Gunilla Pettersson at May 26, 2007 08:36 AM
With all the caveats that might apply to this admittedly unscientific survey, the fact is the results seem to indicate sophisticated understandings of the listed candidates strengths and weaknesses. The question is: at this juncture, what can we learn from the survey results that might be helpful as the process moves along?
It is noteworthy that respondents weighted the five qualifications listed. "Knowledge of Development" and "Effective Manager" were deemed "very important" by roughly 85% of the more than 600 respondents. Roughly 50% of the respondents said that "International Organization Experience" and "Political and Diplomatic Experience" were "very important" whereas only 34% indicated that "Banking and Finance Experience" are in that category. This argues for weighting the five categories by assigning a full weight to knowledge of development and effective management skills, 60% weight to experience with an international organization and political and diplomatic experience, and 40% weight to banking and finance experience. These weighted results can then be compared to an unweighted sum of the percentage score of “excellent” received by each of the nine listed candidates for each of the five qualifications.
The ordinal ranks are quite similar, as between weighted and un-eighted results. Kemal Devis (Turkey) and Stanley Fischer (U.S.) come out 1st and 2nd respectively in both rankings, and Tony Blair (U.K.), Robert Zoellick (U.S.), Richard Levin (U.S.), and Robert Kimmitt (U.S.) come out ranked 6, 7, 8 and 9 respectively in both. The only difference between the weighted and unweighted rankings is that Robert Rubin (U.S.) ranks 3rd in the unweighted rankings and 5th in the weighted rankings.
Trevor Manuel (South Africa) and Montek Ahluwalia (India) come in ahead of him (3 and 4 respectively) in the weighted rankings and behind him (4 and 5) in the unweighted list. What pushes Robert Rubin down in the weighted ranking is his very low score (13%) in knowledge of development, one of the two fully weighted qualifications in the weighted rankings, and 19% in experience with an international organization. Both are important dimensions of being president of the World Bank, which, it seems, cannot be ignored. His high scores in the other three qualifications are enough to get him #3 in the unweighted list, but not enough to put him near the top on the weighted ranking, which is undoubtedly the more appropriate one to use.
The most important element that distinguishes the high rankings of the top four candidates in the weighted ranking, three from developing countries (Dervis, Manuel and Ahluwalia) and Stanley Fischer from the U.S., is their ability to score high percentages in the “excellent” ratings in at least four of the five categories. This means that the fact that there are multiple criteria does generate high scoring candidates with a range of high abilities rather than high strength in a few which drums out weaknesses in other categories.
Stanley Fischer (U.S.) does extremely well on knowledge of development and international organization experience in relation to the four other candidates from the U.S., but he also has an extremely high score (82 %) in experience in business and finance, and does reasonably well in the remaining two categories. On the other hand, Tony Blair’s extraordinarily high rating in political and diplomatic experience of 84% is not enough to overcome deficits in banking and finance, knowledge of development and his lack of experience at international organizations, compared to other candidates. So broad, balanced excellence across qualification categories seems the formula for becoming a prime candidate to be president of the World Bank, following this methodology.
Posted by: Colin Bradford at May 31, 2007 02:56 PM