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NEWS August 1, 2023

The Last Stop for Sanctioned Projects

MDCAO, Shaolin Yang and Sanctions Board Executive Secretary, Jodi T. Glasow

A Conversation Between MDCAO, Shaolin Yang and Sanctions Board Executive Secretary, Jodi T. Glasow 

In July 2023, Jodi T. Glasow, Executive Secretary to the Sanctions Board, was interviewed by Shaolin Yang, the World Bank Managing Director and Chief Administrative Officer (MDCAO). During the interview, Mr. Yang and Ms. Glasow discussed topics including the Sanctions Board’s role in the sanctions system, its impact on other Multilateral Developent Banks, and its contributions to the World Bank’s values.

The full interview is reproduced below. It was originally published on July 10, 2023, as part of the “MDCAO Quarterly Update” internal communication.

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Shaolin Yang and Jodi Glasow discuss the Sanctions Board’s conclusive role in settling contested project-related procurement sanctions cases.

Shaolin: First and foremost, congratulations on your appointment as Executive Secretary of the Sanctions Board. We are delighted to have you here. To set the stage, tell us about the Sanctions Board, and what it does. 

Jodi:  Thank you, Shaolin. 

Unfortunately, corruption remains an impediment to meeting development goals, and it needs to be faced head-on. At the WBG, we have a dedicated mechanism to provide accountability in our projects and ensure the proper use of our resources: the sanctions system. The Sanctions Board is one of its components. 

The sanctions process begins with the Integrity Vice Presidency (INT), which investigates firms and individuals (typically called “respondents”) for fraud, corruption, and other misconduct relating to a WBG project. If there is sufficient evidence of wrongdoing, INT submits formal accusations to a first-tier decision-maker (the Office of Suspension and Debarment at the World Bank, or the Evaluation Officers at MIGA, IFC and for WB private sector guarantee projects). This first-tier initiates sanctions proceedings and, based on the evidence, may recommend sanctions.  

If respondents wish to contest this recommendation, they can appeal to a second-tier decision maker: the Sanctions Board.  This happens in approximately 33 percent of cases. The Sanctions Board receives additional written pleadings from both parties and often conducts an oral hearing before issuing a final decision. About 98 percent of Sanctions Board decisions result in sanctions.   

Shaolin: What types of sanctions can be imposed, and how does the Sanctions Board select them? Is there a case that was particularly memorable?

Jodi: Sanctions usually involve some form of ineligibility to participate in WBG-financed projects. It is what we call “debarment.” In most cases, respondents can only be released from debarment if they comply with certain conditions to reduce the risk of future misconduct. 

This is not a cookie cutter process, though. The Board looks at all relevant circumstances to make a decision. In cases where the facts are less severe or the risk is lower, lighter sanctions may apply, such as conditional non-debarment or a letter of reprimand. 

Shaolin:  What feature of the Sanctions Board do you like the most?

Jodi: Most important is the forum the Sanctions Board provides for parties to be heard and for respondents to present a meaningful defense. I have learned over the years that, in any dispute resolution mechanism, the process is as important as the outcome.  If the process by which a decision is made is fair and transparent, people will accept it more easily.  

Shaolin:  How has the role of the Sanctions Board evolved over time?

Jodi: The biggest changes have been on two fronts: 

First, greater independence. In 2016, the Sanctions Board transitioned to an all-external membership consisting of seven external Board Members who are top jurists and development experts. Sanctions Board members do not report to WBG Management and exercise their review of sanctions cases in an impartial and independent manner.

Second, greater transparency. In 2012, the Sanctions Board began publishing the full text of its decisions.   This not only allows the public to understand the basis for the sanction, but also brings credibility and confidence to the process.  We also periodically publish a summary digest of decisions that presents the Board’s case law in an accessible format.

Shaolin: How does you work impact other MDBs?

Jodi: There is a West African proverb that says ‘If you want to go fast, go alone. If you want to go far, go together.’ This is very true of our work with other MDBs. Many years ago, the IFIs came together to develop a harmonized approach to combat corruption in the IFIs’ activities and operations. The discussions resulted in agreed standardized definitions of sanctionable practices like fraud and corruption, and the agreement to recognize and enforce each other’s debarment decisions. All of these were formalized in the Cross-Debarment Agreement

In the years since, MDBs also harmonized general principles for business integrity programs, treatment of corporate groups, sanctions, and settlements. This uniform framework and coordination has enhanced the accountability of firms and individuals participating in IFI-sponsored projects globally. 

Shaolin:  During your time in EBC, the WBG refreshed its values.  How has this influenced your work at the Sanctions Board?

Jodi:  The WBG core values are integral to our work at the Sanctions Board. Integrity is at the heart of our mission as an accountability mechanism. We treat parties with respect by providing opportunities for due process and transparency. We value teamwork as we collaborate with internal and external stakeholders, including other MDBs, to ensure our sanctions are fair and effective. We strive for innovation, as we work hard to capture, apply, and share our technical knowledge. Finally, we take satisfaction that our work has great impact by helping the Bank reach its development goals. 

Shaolin: What are you most proud of in your short time at the Sanctions Board?

Jodi: Our staff – the Secretariat.  We are a highly technically skilled and dedicated group of professionals. We provide legal support to the Sanctions Board, and also work tirelessly behind the scenes identifying areas for policy improvements and harmonization, organizing and participating in conferences and workshops, and identifying opportunities for joint communications across the sanctions system.