IFI governance

Background

World Bank Group strategy and reform process

13 October 2013 | Minutes


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Civil society forum

11 October 2013

Sponsor: WBG (Reform Team)

Panelists: Sanjay Pradhan (Vice President, Change, Knowledge and Learning, WBG), Barbara Lee (Manager, OPCS, WBG), Christian Grossman (Director for Corporate Strategy, IFC), Marcus Williams (Chief Officer, Strategy, Communications, and Partnerships MIGA),

Chair: Rachel Winter Jones

Last April, the Board endorsed the two goals of the World Bank Group (WBG): the first to end extreme poverty by 2030; the second to boost shared prosperity by promoting real income growth for the bottom 40 per cent of the population. This is the first institutional strategy to attempt to fully integrate IBRD, IDA, IFC, MIGA in order to help countries reach these goals through economic growth, inclusion, and sustainability.

Sanjay Pradhan

  • Goals endorsed at spring meetings, strategy for annual meetings – heard about drama in papers, etc
  • The goals endorsed provide the mission, strategy provides the framework for achieving the goals – including global practices, spending reviews etc – the means to implement the strategy and achieve the goals
  • Strategy begins with the goals, has to be a reality – need to have deeper and more accelerated impact of lives of people in extreme poverty, and another 2.5 billion
  • Three elements running through:

–       First, focus on country client engagement on the most important challenges to achieving the goals, is it unemployment, corruption, climate change?

–       Second, How to marshal the combined expertise and resources to help the front line client solve the problem – global practice

–       Third, how to partner with external partners, essential to achieve the goals – emphasis on public private partnerships – civil society has to be part

–       How to focus on the most important challenges – in our country partnership strategies can see a story, but need to marshal best evidence on best intervention – evidence based way, eg country diagnostic, also participatory process to arrive at that

  • Have become fragmented as an institution, WB, IFC, MIGA – when clients need public private combined. Multisector solutions are required
  • One thing we are doing, creating global practices to first focus on client solutions areas – 14 identified, health, education, etc, and five cross sectoral – jobs, gender, climate change, PPP, fragility and conflict
  • Global practices trying to get out of fragmentation, in any given area mentioned, we have six practices across regions, but don’t flow – lots the ability to mobilise global knowledge – pulling staff and expertise into global pool, globally connected local pools
  • More public private joint practices, expected to be 13 that are joined, but degree will vary across
  • Changing organisational incentives and practice
  • To have impact need to amplify the voice of the poorest, encouraged by new tools to empower citizenry to have this voice
  • Global Partnership for Social Accountability grants to give voice, 12 grants to CSOs in 10 countries in practical areas, eg Malawi,  – WB playing role between demand and supply side of governance. Citizen feedback will be mainstreamed, eg throughout MENA portfolio already.

Barbara Lee

  • Have concrete target on end extreme poverty for the first time
  • Bottom 40% focus, what does it mean to be inclusive, who will benefit
  • Focus on the goals in a sustainable manner, what does it really mean
  • Interesting conversation across the institutions
  • WB data, growth has been a driver for reducing poverty and boosting shared prosperity, but not enough – need to be accompanied by inclusion
  • Need to look externally and how we react and respond to this, eg shifts in the global economy, private sector flows dwarfing ODA. Recognising unevenness, growing share of FCS
  • Globally connected world, need to work differently, trade finance etc connectivity and its impact.
  • Looked a lot on climate change and impact, falling disproportionally on the poorest
  • Risks, eg natural disasters, financial
  • What can we bring to the development agenda to deliver these goals?
  • Global development agenda, being global, a customised development solutions to clients, reaching out and getting knowledge from the rest of the world, transparency and open data
  • Client base is governments and private sector
  • Now more diverse than low and high income countries, focus on customising solutions.
  • Regional and global engagements are equally important to country based engagement.
  • How do we become a solutions based WBG – what does it mean? Focusing on evidence and what works. How to continue to focus on results. Thinking about what transformational engagements really mean. Focusing on smart risk.
  • Focus on evidence internalising, also adaptation – learn and adapt mantra.
  • Concept for new way of country engagement, eg new way of developing country partnership framework
  • Regional coordination mechanism to be developed, with IFC and MIGA
  • WB can’t do it alone, need to leverage anyone we possibly can – what is our comparative advantage
  • Taking lead when it is appropriate, and how to leverage private finance
  • Working as one World Bank Group, Wolfenson made some progress on this, but then stopped, institutions going individual ways – imperative to think more constructively on blending public and private
  • Corporate level ways of developing synergies, regional level ways, ramp up joint projects
  • Won’t be easy, largely a cultural problem, takes time to change
  • Difference – singular focus on two goals, there is comprehensive change agenda – we write a lot of strategies and document, but now always follow up
  • Monitoring and accountability framework, new corporate scorecard including for WBG
  • Can’t do this alone, will need strong endorsement from board and governors

Christian Grossman

  • Group strategy, first WGB strategy, earlier attempt spring meetings last year innovations for WBG, so can build on this, have worked hard with a large number of staff in working groups
  • Now involved in implementing this

Marcus Williams

  • MIGA provides guarantees to get others to invest money
  • Maximising impact and resources and partnerships
  • We are the winners in this group approach, will help us choose which projects we want to do.
  • MIGA younger institutions, clarity on goals very important for us – will change the way we approach and think about projects. We have to pick and choose what we are doing.
  • Lot of advantages on change agenda, to be as efficient as we can

Q

Country diagnostic, always heard WB has an issue with capacity, would like to hear concrete ideas on how to fulfil any development operation based on systematic country diagnostic including inclusion in the implementation process. How will you engage with civil society organisations, eg with funding.

Q

Easy to be sceptical. Slight concern, cake and eat it, element one WBG – minded when the UN decided to change, a lot of time into how to work together – how will you ensure it won’t be focused don the Bank and on the critical issues.

Q

Energy and extractives, how are you envisioning this changing culture will unfold – you will need to unlearn some ways of doing business. Energy and extractives involve WB and IFC, how to unlearn and create frameworks for staff, both on the governance side and on the demand for good governance and bringing voices of affected communities

Q

New CPF and country systematic diagnostic, consultation with CSOs at diagnostic and CPF level – how do you plan to do this. Any strategic environmental and social assessments included. Elaborate on public and private together

Pradhan

  • On inclusion, engagement with CSOs, etc, on the citizenside, we want to systematically integrate citizen voice. Requires intermediariy organisations, CSOs. Many CSOs in dev countries face capacity constraints, therefore created Global framework citizen accountability. 32 countries have joined – didn’t expect this degree of interest, will need to go out and get more funding once IDA replenishment is done.
  • WBI came to conclusion the bulk of knowledge is dispersed across the world, WB a global connector rather than tool.

Lee

  • Analytics is about what kind of knowledge and evidence is out there.
  • WBG for the first time has something substantive to focus on, talk together how to best reach. Can be a huge time suck, but we don’t know enough about each other, will be time consuming, but positive, work in a more integrated way.

Q

Corporate scorecard – how will this improve monitoring and accountability, will you seek CSO input. Safeguards review, there is a delay, where will the safeguards sit and the IFC model  – any comments on this

Q

Heavy focus on PPPs and investment in infrastructure to drive the strategy. Why the focus on PPPs, research has shown not always the best model.

Q

Sceptical challenges are being addressed in equal balance. Not enough detail on incentive structures changing, how is this balance being recast.

Q

Citizen feedback mechanisms, IP and CAO, often not on objectives of projects but unintended adverse impacts – WB not learned from this, how will you learn from this going forward. There are legacy issues, how are you addressing these, eg Chad Cameroon – PPP, financing from other institutions, big regional project – is this the kind of projects we are looking at going forward.

Lee

  • Corporate scorecard is work in progress
  • A lot of progress in the IDA process, has pushed the institution to be more accountable – learned don’t want things cast in stone – corporate scorecard as a living document, will be presented at spring meetings.
  • Things to be included, the things prominent in the strategy eg working better together as one WBG, just finalised measures for this, including citizen feedback
  • Safeguards review, the strategy is not a policy document, broad framework. Policy changes and reform is a long and longwinded process. Transparent and consultative process on safeguards. Not to come up with final solutions on safeguards review.
  • PPPs mentioned once in the strategy, infrastructure mentioned once – made a concerted effort to highlight specific sectors in the strategy. Don’t say infra or PPPs will play a great part, but focus on blending public and private finance.

Williams

  • Transformational projects, different models, different ways to manage the risks – different ways of doing it
  • Liquidity problems after financial crisis, different countries different priorities.

Grossman

  • PPPs are essential, this is where we will work as a group, but also projects where we will pursue these without a very big consultation as they fit into the country partnership framework.
  • This is not only about PPPs, but this is where we can really harness experience as a group

Pradhan

  • To be successful and focus on the most important challenges, need to strengthen clients on the demand side. In the incentive structure will introduce the programme leader, as holder of problems and source solutions from global practice
  • Transformational engagement and learning, this will indeed be big infra projects, but not confined to that. We will look at what are the game changers, not necessarily a big infra project – could be corruption and procurement.
  • Where we haven’t listened very well, I take your point, we have to learn and adapt, listen learn and adapt
  • How we will unlearn, two things, will have to focus a lot on structural change. Need stronger cultural collaboration, will need to unlearn about individual glory is the way to success.

Q

2009 debate on governance reform, is that debate over, is the new strategy having impact on governance, on board decision making for instance

Q

Supervision and additional costs of working in FCS are higher, IDA will have further funding, with all three parts of the Wb – how you will absorb the additional costs of engagement in FCS

Q

Importance of voice done, but how to have this voice in the most difficult operating environment – where there is not free speech, and where there may be reprisals. How to respond when there is closing space. Turkmenistan example.

Q

Bujagali dam highlighted in strategy, IDA Inga examples. WGB PS for PPPs last year, this is an issue. Higher risk projects, eg Chad Cameroon risk is borne by poor and vulnerable. How will this high risk strategy really help the poor and most vulnerable

Lee

  • Voice (governance) reform, ongoing process, when it ended commitment to renew in 2015.
  • Discussion on new financial model for WBG, budget cuts etc. When we wrote the strategy, we were clear on additional expenses – emphasis on FCS, will cost more money. Cost expenditure review.

Williams

  • New group will help, in the past not being taken lightly. From MIGA a lot of collaboration on these kind of issues (FCS), whether to support project.
  • Work closely with WB, draw on IFC resources, and its standards and governance policies that we use and try to apply.

Grossman

  • Bujagali and Inga, with respect to power projects, these projects benefit the poor. Bujagali doubled energy, brought down costs. May be others where there may be more difficulties, we will not only do these kind of projects.

Pradhan

  • Bujagali half of Uganda’s power supply, CAO looking at 3 cases, IFC cooperating. Respect to social and environmental safeguards, but shouldn’t shy away, who is going to take these on. Question, what will really make a huge difference. Engine of growth, take on risk but in a way that is responsible.
  • On safe space, shrinking or no voice – this is a hard issue. We have limited direct scope in changing these parameters. In the global partnership for social accountability, many of these are repressive regimes – use this as a Trojan horse, create safe space for constructive collaboration. Have to be committed and skilful, we will not achieve anything close to our results if we don’t expand the ability of poor to participate.