There should be an open international process to choose the President of the World Bank. It is unknowable if an open process will find the best person, or even if such a “best” person exists, but in forcing candidates and their supporters to come into the light, it will find a better person.

Some background on the Board of Executive Directors of the World Bank

Member nations of the IBRD are represented by Executive Directors known as « chairs » and have voting powers in close proportion to their capital contributions.^[1] The US has 15.54%   of IBRD voting rights  (and 1 ED chair);^[2] Japan has 7.15%  (1 chair); China has 5.97% %  (1 chair); Germany has 4.25 %  (1 chair); France  (1 chair) has 3.90%; the UK (1 chair) has 3.90%; and Saudi Arabia has 2.77  (1 chair). The top 7 chairs therefore have 43.58 % of voting rights. Countries with fewer voting rights are organized into constituencies; an example is the constituency of 24 francophone and lusophone nations in sub-Saharan Africa, which holds 1.97% of voting rights and elects a national of one member nation on an agreed rotation. The BRICS control 17.75% of voting rights. The voting powers of IFC and of IDA differ somewhat as can be seen at https://thedocs.worldbank.org/en/doc/647ce0b6e07b4244d396beea01924292-0330032021/original/IDAEDsVotingTable.pdf

How the President has been chosen

The selection of the President of the World Bank is simple. The US nominates someone, the other chairs extract various promises from the candidates  (usually senior management jobs for their nationals), some of the modern candidates go on “listening tours”, and the person is then approved. There have been occasions when other countries have nominated candidates, but they never got far. There has never been a woman President of the World Bank.

Why is the selection of the WB President important ?

The process is important because it should, in theory, force some accountability on the Board and force the appointee to say openly what they will do before they are confirmed. The Board should not be able to say: “The Americans made us take this guy so don’t blame us if things go badly”.   Next, the process is important because it should force candidates to prove themselves to staff who do the work. The process matters because clients know perfectly well that it has been dishonest. Clients should no longer be able to complain: “The Bank lectures us about transparency and governance and look what they do because the biggest shareholder has to find a job for one of its politicians”.

What is wrong with the process now ?

The process is corrupt because it is the monopoly of the US and because it has produced bad outcomes on (at least) three occasions in this century.

The G. W. Bush administration wanted to do something for Paul Wolfowitz when he was run out of the Department of Defense. The Bush regime knew that Wolfowitz could not be confirmed anywhere in the USG because he had misled Congress about the cost of the second Iraq war^[3]. So, Bush decided to make Paul the President of the World Bank.^[4]  The highlight of Wolfowitz’s tenure was when he asked in a financial meeting « What is ‘spread’ ? And what is this LIBOR thing you guys are always talking about ? »

When Wolfowitz was run out of the Bank, the Bush administration had again to do something, and quickly,  to keep the US hold. It chose Bob Zoellick.  Now Zoellick was, compared to Paul, an upgrade. He had some idea of global trade and finance, understood that the Bank needed more capital, and had a wider vision of the institution than Wolfowitz[5].  Zoellick knew people around the world for reasons other than invading their countries and could be counted on not to get too friendly with the help. Zoellick’s first problem was that he had no interest in the Bank’s project work or in its impact (which admittedly might have been a good thing from the point of view of some staff). His larger problem was that he considered talking to staff to be beneath the dignity of a future member of the Romney administration. Another example of Zoellick’s personal unsuitability was his obscene vendetta in the Albania Inspection Panel case, where he purged good people because he enjoyed doing so. This special arrogance may have been attractive in a Republican administration, but it is unacceptable in an institution working in 150 countries, having thousands of staff spread across the globe, dozens of project types, dozens of working languages, and highly qualified professional staff most of whom were not picked because of political connections.

The third example is David Malpass. It is true that Malpass was a better choice than Ivanka Trump. Reliable friends in the Bank tell me that Malpass was not personally obnoxious, like Zoellick  (or Jim Young Kim) and knew something of finance, unlike Wolfowitz. Yet accountability is so feeble at the Bank that Malpass might still be at 1818 H Street had he not accidentally outed himself as a climate denialist after allowing a continued irresponsible expansion of the Bank’s budget support lending.

The point is not to drag these losers more than they have already dragged themselves. The point is that the US monopoly has produced bad candidates in at least 3 of 5 World Bank Presidencies in this century^[6]

A common theme in the five new Presidents of this century is: the US did not look too hard to find them. Of the five, two were unknowns who happened to meet a member of a Democratic administration somewhere. One should have been in the dock in the Hague. One was a last-minute substitute for Trump’s daughter. If Paul had not been shagging a staffer, then Zoellick would have been doing what he is doing today, hanging around a right-wing foundation boring people with some back-in-the-day stories.

Readers may object that the person and personality of the President are inconsequential. It is true that the Bank has always had dedicated and qualified staff. The functioning of the Bank have improved since the 90s; the institution is decentralized,  is more diverse, more equitable, and more inclusive, has an excellent IT system, publishes its project and research work online, and can be held accountable through the Inspection Panel and the internal Tribunal. The NGOs will never admit this but these are many of the reforms they have been demanding for decades.

Yet. The President makes a difference because the Bank cannot do what it must do with poor leadership. The boom in WB Group commitments^[7] — IBRD, IDA, and IFC — in this century has not improved the quality of lending and has left the institution open to an old criticism that remains valid today — the Bank sacrifices quality for volume. The WBG has done too little to invest in the green transition. Many of its efforts to mitigate climate change or to adapt to its effects are unsuccessful or are dishonest greenwashing. The President of the Bank matters because that person is uniquely placed to lead in the polycrisis. I defy anyone to say that any of the four has done that.

How to find better candidates

Reduce the WB Presidency to a single 4-year term, with no possibility of a second term (a “Mexican Presidency”).

Rotate the office among the regions of the world, as is the practice with the UNSG, where North America would be last given the US historical monopoly on the job and where Europe would be excluded until it abandons its monopoly on the Fund.

Rotate the office between women and men, with a woman being Banga’s immediate successor.

Start with a public list of candidates. Allow constituencies to submit a single name for a national of any constituency but their own. The Nordics could submit a Brazilian and the Brazilians could submit a Pakistani. All names submitted will be made public--if you want to be President of the WB, then say so. No candidates can be current members of the Bank’s Board or of any government.

No candidates will be allowed who have been CEOs of other international organizations  (e.g., WHO, WTO, or UNEP) because such people are already compromised by what they may have done to get those jobs.

Prepare a public shortlist of at least five candidates by a live meeting of the full Board.

Ban lobbying by any member government at the shortlisting or interviewing stages^[8]. If governments want to express support for their preferred candidates, they may do so in public messages.

Publish statements by each of the finalists on what they would do as President of the WBG.

Require full public disclosure of wealth and income of the candidates, including holdings of their family members, and make the final choice contingent upon a public audit of the candidate’s fortune.

Hold live presentations on social media by the finalists with live questions on the candidate’s plans for the Bank and specifically on the green transition.

Hold webinar presentations by the candidates to Bank staff with a system for anonymous questions.

Require the Board to hold a live vote using the IDA capital weights.

Why is this procedure better ?

The procedure is public.

It prevents candidates from answering with the usual platitudes. Does anyone think that Malpass or Wolfowitz or Zoellick (!) could have answered direct questions from the European NGOs or from Bank staff? Could a Brazilian candidate answer questions from Eliane Brum about the Amazon  ? Which candidates can answer questions about the accounts of their national oil and mining companies ? Does anyone think that Banga would have said in an interview what he now says publicly that he « doesn’t need this job « ?

It forces candidates to show their wealth and where they got it. This would probably deter several candidates whose names have gone around more than once.^[9]

Rotation ends the discussion about regions.

A “Mexican Presidency” ends the politicking for a second term. Kristalina Georgieva has just gotten a second term at the Fund, and we will never know what promises she made to get that second term.

Rotation ends the discussion about gender.

Is four years too short ?  No. If the person cannot deliver, then 4 years is too long. If the person can deliver, then their successor inherits a good situation, and potential successors are forced to say during their campaigns « this is how I would continue success ».

Some will say that the staff should not have voice because they have a conflict of interest in picking their new boss. I am not saying that staff should have a vote. I am saying that staff should have the chance to embarrass the bad candidates. A candidate who cannot answer technical questions or who cannot deflect ill-intentioned questions is a bad candidate.

Would a single four-year term discourage top candidates who would be sacrificing other opportunities ? Those who say “yes” should think more carefully. They are saying that a few dollars are more important than leading the world’s major development bank. The Bank should not want anyone to whom a little bit of money is so important.

The logic of this proposed procedure is that there is no absolute best candidate and that it is difficult to choose among many good candidates. In that kind of market, it is vital to gather as much information as possible, to force candidates to show their weaknesses in public, and to require those making the decision to show their reasoning. Think of it this way — would any of the four new Presidents in this century have any chance of being re-appointed given what we know now ?

I return to the second law of medicine and the second law of economics which are, as ever, the same: if something is not working, stop doing it.

[1].https://thedocs.worldbank.org/en/doc/1da86cb968275b94ab30b3d454882208-0330032021/original/IBRDEDsVotingTable.pdf

[2]. It is indicative of the US indifference to the Bank that its chair is still vacant 7 months after the departure of former ED Adriana Kugler.

[3]. If you doubt that Wolfowitz’s mission at the Bank was to do the bidding of the Bush regime, then here is a story. When Wolfowitz’s candidacy had been announced but before he started at the Bank, I happened to be Director of Agriculture and the Environment in the Africa Region. The RVP’s office called one day, “Wolfowitz wants to visit a department in the Africa Region, and we thought agriculture would be a good fit”.  Paul turned up that day with a person whom I recognized as vile Cheney campaign flunkie Kevin Kellems.  (The story of how Kevin left the Bank is very funny but regrettably I cannot tell it here; thanks to a commentor for this good advice). As Paul was talking to one of my colleagues, I asked Kevin “Are you with State or Defense ?” Answer: “No, I am with Paul”.

[4]. In 2004, when I was WB Country Director in Senegal, some EDs visited our program. One of the EDs was R. B. Holland, a Texas lawyer, and FoGWB. I invited Mr and Mrs Holland to my place for a private dinner and a couple of bottles of Algeria’s finest red. With a few months before the 2004 US election, and about a year before the end of Wolfensohn’s second term, the conversation got around to the next President of the WB. Holland floated a few names “if we win” … “Powell ? Other fish to fry” “Rice ? Lightweight” ‘Evans ?” “Good idea but spending time with family” A couple of other names went around but no mention of Wolfowitz or Zoellick.

[5] I should not exaggerate Zoellick’s financial acumen. Writing in the FT in 2010, in the middle of the GFC, he proposed a return to the gold standard.

[6]. I have accepted the advice of counsel (thanks again to a commenter here) and will say nothing about JYK. The jury is out on Banga but his line about how he doesn’t need this job is not helping his image.

[7]. For which Zoellick and Kim deserve some credit.

[8]. Some may recall Wolfowitz’s pathetic effort to save his job by buying support from four member countries, an effort which did not pay off for Paul but did for someone else (again thanks to a commentor for preventing me from going into more detail than is strictly necessary).

[9]. The income and wealth of everyone in senior management should also be published.