It’s good to be back

As the deadline for nominees approaches, now less than 48 hours away, how can one take stock of a flawed process to make a flawed candidate win?

The United States behaved furtively in the heat of August to push through a hasty process when many Executive Directors and senior shareholder officials were on leave. Caught out by the Staff Association and international media (the FT, the WSJ and CNNI’s Quest on Business), Treasury forged ahead with its plan to have Dr Kim reappointed before the Annual Meetings, 10 months ahead of the end of his term. Shortly after midnight the very day the three-week nomination period opened, Treasury nominated him by email.

Preempting other candidates with this show of force, Treasury then twisted a few more arms, with calls to their World Bank counterparties in various countries, including Pakistan. China, Germany, Japan and France fell in line, as did the UK’s new, green Secretary of State for DfID, with Canada acquiescing in a throwaway remark by its Finance Minister at a G20 presser.

It is no secret in Washington that Treasury Secretary Lew is no fan of Dr Kim, so despite the formal role his office plays in the nomination, all fingers point to the White House. Rewarding golfing buddies is not exactly President Obama’s style, but the fait accompli is nearly done.

So, what’s the next step in this flawed process for a flawed candidate?

If the Board had any sense, it would step back, reflect, and admit there’s no rush. It would set up a proper search committee, charged with finding a suitable list of qualified women and men who could do the job. An executive search firm would help, not just to assess candidates’ records but also to provide reality checks to the committee’s in camera discussions. The search committee would give the Board a long list and recommended finalists in early January.

If the Board has no sense, and prefers to succumb to US threats about an IBRD capital increase (not the Obama Administration’s call, alas, and dependent mainly on who controls Congress), then go through a full process of comparing Dr Kim to the published criteria from the 2011 process. He would not fare well.

Some argue that a Dr Kim, reappointed under heavy criticism and weakened through a more public process of scrutiny by the Board, would be less able to lead the Bank through an IDA Replenishment. Again, that’s not America’s call against a hostile Congress and depleted treasuries in Europe and other donor countries. And a bigger Replenishment will depend on clever financial engineering (more IDA loans) and corporate public relations by an experienced IDA team. These are two areas where Dr Kim has not demonstrated strength.

It’s hard to paint an optimistic future of five more years of Dr Kim, even if you are prepared to ignore his disappointing performance since 2012, and the lack of confidence World Bank Group staff have confirmed in his communication and execution of strategy, and his failure to establish a culture of trust and respect.

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