IFI governance reform: rumbling slowly on?

News|Bretton Woods Project|27 November 2008|update 63|url
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Minor changes to World Bank governance were agreed at this year's annual meetings, with a timetable for further reform that could stretch to 2011. As pressure grows for fundamental reform of the international financial architecture, it's unclear what will happen to this process and if reform of the IMF's governance will recommence.

The annual meetings agreed a third board chair for Africa and small increases in voting share for developing countries at IBRD and IDA. Apparently there is "considerable agreement" that the president should be selected in a "merit-based and transparent" process, with "nominations open to all board members". Cynics will argue this description would not have ruled out the European steam-rolling of their candidate for the IMF, Dominique Strauss Kahn last year (see Update57).

The comminiqué indicates that the reform process will continue for quite some time, possibly up to the 2011 spring meetings of the World Bank and IMF. The board is tasked to undertake "an important shareholding review" that will consider "moving over time towards equitable voting power between developed and developing members."

In the run up to the annual meetings, World Bank president Robert Zoellick also promised a commission, led by former Mexican president Ernesto Zedillo to modernise the Bank's governance structures.

Transparency reviews due

The World Bank is preparing to formally launch the review of its disclosure policy, with external consultations expected in early 2009. A similar IMF review is expected next year. In October, the Global Transparency Initiative (GTI) demanded a complete overhaul of the IMF's disclosure rules. A detailed GTI report found that IMF's practices on information disclosure fall far short of best practice standards, and are even worse than the World Bank's policy, previously critiqued by the GTI.

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Published: 27 November 2008 , last edited: 1 December 2008

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