Leadership Perspectives

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In recent years, historic progress has been made to end extreme poverty around the globe. More than 1 billion people lifted themselves out of poverty in the past 15 years alone. In 2015, for the first time ever, the World Bank Group forecast that the global percentage of people living in extreme poverty fell under 10 percent. This is a remarkable milestone.

Yet the world today faces challenges that are as complex and vexing as at any time in recent memory. Strong economic headwinds have slowed global growth; fragility and conflict have displaced tens of millions of people from their homes; countries and their economies are vulnerable to natural disasters and climate change–related shocks; and a pandemic can spread quickly without warning. We are all affected by these challenges, but the stark truth is that people living in extreme poverty are hit first and hardest.

Our mission at the World Bank Group is defined by two goals—to end extreme poverty by 2030 and to boost prosperity among the poorest 40 percent in low- and middle-income countries. To achieve them, we are focusing on broad-based, inclusive growth, and we remain vigilant against shocks that can reverse hard-won gains in development.

We know that business as usual won’t be enough. The World Bank Group is collaborating in new ways with an increasingly diverse array of partners. For example, we partnered with the United Nations and the Islamic Development Bank Group last year to launch an innovative financing facility in support of Syrian refugees and host communities in Jordan and Lebanon. Based on the initial contributions provided by eight nations and the European Commission, the facility will be able to immediately generate up to $800 million in concessional loans for Jordan and Lebanon. This will allow the scaling up of programs to expand vital services, such as health and education, to meet the combined demand from refugees and citizens.

This is one of the many groundbreaking solutions we are implementing to address today’s global challenges. The talented and dedicated staff of our main financing institutions—the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA)—work together to mobilize the innovative solutions and investments necessary to support inclusive economic growth.

This year the World Bank Group committed nearly $64.2 billion in loans, grants, equity investments, and guarantees to its members and private businesses. Client demand for IBRD’s services continues to be strong, and this year it made commitments totaling $29.7 billion—the highest amount ever outside of a financial crisis. And IDA, the World Bank’s fund for the poorest, committed $16.2 billion to support countries most in need to face their toughest challenges.

Working with the private sector will become increasingly important to meet the scale of financing needs for our development goals. IFC and MIGA, our two institutions focused on private sector development, are strengthening their efforts in this regard. IFC delivered a record amount of financing for private sector development—about $18.8 billion, including $7.7 billion mobilized from investment partners. IFC’s investments in fragile and conflict-affected areas climbed to nearly $1 billion, an increase of more than 50 percent over the previous year. MIGA issued $4.3 billion in political risk and credit enhancement guarantees underpinning various investments, with 45 percent of its active portfolio in IDA-eligible countries and 10 percent in countries affected by conflict and fragility.

The progress we’ve made in recent decades shows that we are the first generation in human history that can end extreme poverty. This is our great challenge, and our great opportunity. With the collective determination of the World Bank Group, our member countries, and global partners, I remain optimistic that we can tackle these challenges—one region, one country, and one person at a time—and create a more prosperous and inclusive world for all.

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Dr. Jim Yong Kim

President of the World Bank Group
and Chairman of the Board of Executive Directors

The 25 resident Executive Directors, representing the World Bank’s 189 member countries, are responsible for the conduct of the general operations of the World Bank under delegated powers from the Board of Governors. The World Bank comprises both the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA). The Executive Directors select a President, who serves as Chair of the Board. The current Board term is from November 2014 to October 2016.

Executive Directors fulfill an important role in guiding the general operations and strategic direction of the entire World Bank Group (WBG), and they represent member countries’ viewpoints on the Bank’s role. They consider and decide on proposals made by the President for IBRD and IDA loans, credits, grants, and guarantees; new policies; the administrative budget; and other operational and financial matters. They also discuss Country Partnership Frameworks—the central tool by which management and the Board review and guide the Bank Group’s engagement with client countries and support for development programs. Moreover, Executive Directors are responsible for presenting to the Board of Governors an audit of accounts, an administrative budget, and the World Bank’s Annual Report on fiscal year results.

The Board has five standing committees, namely, the Audit Committee, the Budget Committee, the Committee on Development Effectiveness, the Committee on Governance and Administrative Matters, and the Human Resources Committee. Executive Directors serve on one or more of these committees, which help the Board to discharge its oversight responsibilities through in-depth examinations of policies and practices. The Executive Directors’ Steering Committee meets bimonthly to discuss the Board’s strategic work program.

Directors periodically travel to member countries to gain firsthand knowledge about a country’s economic and social challenges, visit project activities financed by IBRD and IDA, and discuss with government officials their assessment of the collaboration with the Bank Group. In fiscal 2016, Directors visited Bangladesh, the Democratic Republic of Congo, India, Indonesia, Mauritania, the Philippines, Senegal, Sri Lanka, and Vietnam. They also visited Syrian refugees and hosting communities in Jordan and Lebanon.

The Board, through its committees, regularly engages on the effectiveness of the activities of IBRD and IDA with the independent Inspection Panel and the Independent Evaluation Group, which report directly to the Board.

 

Board achievements of fiscal 2016

Highlights from the committees include the Audit Committee’s work on various proposals to strengthen the financial capacity of IBRD, IDA, and MIGA, and to manage financial and other risks for the World Bank Group. The Budget Committee provided support to the successful implementation of the budgeting (”W”) process and the Bank Group’s expenditure review, as well as guidance on the financial sustainability of the institution. The Committee on Development Effectiveness focused on matters pertaining to the Bank Group’s strategic direction and the quality and results of Bank-supported operations, including the modernization of the World Bank’s Environmental and Social Framework, external reviews of the Independent Evaluation Group, the WBG Forest Action Plan, and the Development Policy Financing Retrospective exercise. The discussions of the Committee on Governance and Administrative Matters focused on the development of a dynamic formula for IBRD shareholding, as part of implementing the 2015 Shareholding Review. The Human Resources Committee considered various activities related to the Bank Group’s human resources strategy, including career development, financial assistance, contract architecture, the short-term workforce, strategic staffing, and diversity and inclusion.

The focus of the Board is to help the Bank achieve the objectives of ending extreme poverty and promoting shared prosperity in a sustainable manner. During fiscal 2016, this was done in part by engaging with management to build a medium to long-term view of the role of the World Bank Group in a changing global development landscape, as requested by the Board of Governors in the 2015 Shareholding Review. Board support also builds upon engagement with partners in the World Humanitarian Summit, the 21st Conference of the Parties (COP 21) to the United Nations Framework Convention on Climate Change (UNFCCC), the United Nations Sustainable Development Summit 2015, Financing for Development, the IDA Replenishment process, and the Sustainable Development Goals. The discussions have considered both how the Bank has evolved and what further changes it can make to ensure that it remains a premier global development institution, and ways to strengthen its financial position. Discussions will conclude by the 2016 Annual Meetings.

The Board uses several approaches to oversee and guide management on achieving the Bank’s objectives. In fiscal 2016, the Board discussed topics important to the Bank’s operations, including forced displacement; the implications of low oil prices for the global economy; development data gaps; managing the energy transition to meet growth, poverty, and climate objectives; mainstreaming disaster risk management; development goals in an era of demographic change; global housing; development impact through tourism; financial inclusion; state-owned enterprises; illicit financial flows; and public debt vulnerabilities in low-income countries; among others. It also deliberated on important internal activities, such as the future of the World Bank Group (in both the medium and the long term); corporate scorecards; IDA support; nonconcessional borrowing; implementation of the new procurement framework; WBG financial sustainability; the Middle East and North Africa regional strategy; strategic priorities for fragility, conflict, and violence; the Climate Action Plan; and the WBG Gender Strategy. The Board considered the results and operational implications of the World Development Report 2016: Digital Dividends and looks forward to the 2017 report on Governance and the Law.

Furthermore, the Executive Directors approved several crisis or emergency responses for a wide range of clients, including Ecuador, Iraq, Mozambique, Myanmar, Pakistan, and Sierra Leone. They also approved the Pandemic Emergency Financing Facility as a concrete action in response to the Ebola outbreak in West Africa. The Board welcomed the Independent Evaluation Group’s Results and Performance of the World Bank Group 2015 report, as well as the Inspection Panel’s reports concerning Kenya, Kosovo, Mongolia, Nepal, and Uganda. The Board also welcomed Iraq to the International Centre for the Settlement of Investment Disputes (ICSID), the Republic of Nauru to IBRD and ICSID, and congratulated the Republic of Korea for graduating from IBRD.

Overall, the Board approved approximately $45.9 billion in financial assistance in fiscal 2016, comprising about $29.7 billion in IBRD lending and about $16.2 billion in IDA support. The Directors also reviewed 75 country engagement products. The Board approved an administrative budget for the World Bank of $2.5 billion for fiscal 2017.


Board of Executive Directors




The World Bank Group