"A Different Take on Enhancing Voice at the International Financial Institutions"
by Karen Joyner Sept 2004Executive Summary
Over the last two years, renewed attention has been given to the need for more participation by developing and transition countries in the decision-making of the World Bank and International Monetary Fund. The Monterrey Consensus of the Financing for Development Summit in Mexico in March 2002 gave this important issue new meaning by linking it to the ability to reach the Millennium Development Goals. Framed in this light, the donor community became more interested in the need for democratizing the International Financial Institutions.
Since then, the staffs of the World Bank and IMF have prepared various papers for the consideration of the Development Committee of the World Bank and IMF's Boards of Governors. Some progress has been made and some future options have been identified, but there is much to be done. This paper seeks to contribute to this dialogue by proposing pragmatic ways in which governments and people in the South can better participate in operation and governance of the World Bank and IMF.
The concept of "voice" for poorer countries in governance at the international financial institutions can be viewed in a number of ways. Some define it in terms of voting power on the Executive Boards, while others see it more in terms of other aspects of influence – where countries with effective Executive Directors on the Boards can pitch well above their actual voting weight. Voice more broadly might be rated as the level of country ownership of economic reform programs.
However defined, it is widely accepted that poor country voice is not heard enough in the governance or operations of the World Bank and IMF and should be stronger.
Change to the voting structure at the institutions will take significant consensus building and political will. We seem to have reached an impasse at promoting such radical change, and the suggestion by Mr. Trevor Manuel in March that an Eminent Persons' Group take leadership has still not been acted upon. We support his call, and in this paper suggest options the Group should consider and encourage civil society involvement in its work.
Various measures have been and are being taken to address voice deficits. More staffs have been allocated to the least capacitated Executive Directors' offices; an Analytical Trust Fund has been established to fund alternative research and analysis for the sub-Saharan African Executive Directors; and much preparatory work has been completed to consider options for voting structure revisions and adjustments, particularly at the World Bank.
Voice at the Bretton Woods Institutions that is of most concern to the Social Justice Committee is that of citizens, especially in countries where the World Bank and IMF are most active and influential. We make various recommendations to address voice deficits, focusing on the need for enhanced transparency and inclusion. Transparency at the Boards could be improved in a number of ways, including the provision of more detailed agendas, earlier disclosure of papers presented to the Boards, and more information regarding of discussion at the Boards.
We also explore ways in which the voice of citizens and their governments could be enhanced before decisions reach the Board level. World Bank and IMF missions conducting their business in-country should be more transparent and inclusive, with civil society involvement in determining the need for and implementation of impact assessments. Poor country voice at the Boards would be benefited immensely by improved voice in program design.
The paper then focuses on the Executive Directors' offices, and makes recommendations based on some fifty interviews with staffs of six Executive Directors' offices at both the IMF and World Bank, as well as central staff. Common themes concerning voice emerged from these meetings, such as the need for more capacity for the sub-Saharan African Executive Directors' offices, more open and productive communication between Executive Directors' offices generally, better recruitment and induction, and language training. The result is a number of practical recommendations to address these concerns, such as Executive Directors' offices sharing weekly agendas to improve communication, and for the institutions to provide improved central personnel, training and language support.
In our discussions with Executive Directors' office staffs, it became apparent that more interesting thinking on the voice issue might emerge from workshops dedicated to the issues. While some time at such an event should surely be spent on the important issues of voting and other structural issues, a significant amount of the time should also be spent discussing how voice might be improved at the Boards in more subtle ways that could strengthen poor country and civil society voice in immediately achievable ways. While we have been able to identify a number of ideas for enhancing poor country voice at the Boards, such workshops, followed by a joint World Bank and IMF workshop, would certainly reveal more recommendations. Such workshops would also be a useful entry point for the Eminent Persons' Group - or similar body.
The paper concludes by identifying a series of next steps to be taken at the institutions and by their political leadership. Some work is currently being conducted or is planned at the both the World Bank and the IMF. This work includes the finalization of a learning program for Executive Directors' office staffs, the operationalization of the Analytical Trust Fund, and further work on voting issues. We propose that additional work be added to this portfolio, focused on enhancing ownership, transparency and inclusion as an explicit part of the voice agenda, with participation by civil society.
We also lay out what we plan to do in the coming year as our further contributions to the voice dialogue. The Social Justice Committee plans to conduct focused work on the dynamics of our own Executive Directors' offices, contribute to the evolution of Poverty and Social Impact Analysis as an empowering tool for civil society and, in general, work on addressing ownership and transparency issues in country programming at the International Financial Institutions.
Finally, we restate our recommendations, most of which are immediate steps that can be taken to address voice deficits. We hope to work with our Executive Directors' offices in considering how we might move forward on at least some of these.