Keep the World Bank Accountable

Emerging Voices features contributions from scholars and practitioners highlighting new research, thinking, and approaches to development challenges. This article is from Natalie Bridgeman Fields, founder and executive director of Accountability Counsel. Here she discusses the implications of proposed changes to the World Bank Inspection Panel. This is the first piece in an ongoing Development Channel series on global justice and development.

The World Bank is in the midst of an accountability crisis: over one billion people who live in poverty may lose their right to an independent hearing if they are harmed by a Bank-funded project.

The Bank aims to serve the world’s poorest, but their projects can have negative consequences as well. For the past twenty years, the World Bank Inspection Panel has addressed complaints from people harmed by Bank-funded projects and has served as an independent review to determine if projects comply with the Bank’s own social and environmental safeguards. The Bank claims immunity from lawsuits for harm caused by its official operations due to its status as a specialized agency of the United Nations and because it is comprised of sovereign member governments. Therefore, the Panel helps fill in the Bank’s accountability gap, allowing it to operate as a legitimate, rule-based institution.

The Panel is often the only way for people harmed by Bank-funded projects – including those forced off their land due to the construction of large dams, or poisoned by industrial facilities – to have their voices heard. If a Panel investigation finds that the Bank has violated its own policies, Bank management must respond with an action plan to bring the project into compliance. The Panel report and action plan then goes to the Bank’s Board of Directors who decide what to do next. In the past, Panel investigations have led to consulting affected communities about development projects, redesigning projects to avoid harmful impacts, and occasionally cancelling projects entirely. As the founder and executive director of Accountability Counsel, I have worked for many years informing communities around the world that the Panel exists and helping them use it effectively.

In its current form, the Panel is comprised of three members who serve five-year terms, as well as a permanent secretariat, led by an executive secretary, which supports the Panel’s functions and preserves institutional memory. The secretariat is responsible for fending off Bank management and Board members’ frequent attempts to undermine the Panel and its independence. But this crucial function is now in danger.

On February 13, the Bank’s Board of Directors will consider a proposal from current Panel members to change the rules relating to the secretariat’s independence. The proposal is not a public document and has not been subject to any public consultation or debate. Although former Panel members have fought hard to preserve the Panel’s independence, the current Panel members now want the executive secretary to be a Bank employee who would be allowed to work for the Bank after their limited term ends. In other words, the current Panel members are inviting a revolving door between those supporting investigations and those being investigated.

Under the proposed changes, a member of the Bank’s legal department could determine that a project complies with Bank policy, then work as the Panel’s executive secretary and weigh in on whether those same projects are in compliance with Bank policy. In addition, they will be termed out after five to seven years, at which point they may want their job back at the Bank’s legal department—a motivation that could further taint their decision-making. The proposal allows no cooling off periods or post-employment bans to ensure independence, and no tenured positions keep institutional memory.

Seven highly respected former members of the Panel recently took the unprecedented step of sending a joint letter accusing the current Panel members of undermining the Panel’s independence and effectiveness. The current Panel members’ response demonstrated a lack of interest in the preservation of the secretariat’s independence. If safeguard rules were valued at the Bank, the proposed changes to the secretariat would be quickly rejected. But the Bank has recently adopted a strategy of “smart risk-taking” and “development effectiveness,” paying little attention to the rules established to protect the environment and people’s rights.

The problem starts at the top: as many civil society groups have lamented, Bank President Jim Yong Kim has failed to prioritize accountability and has instead pushed forward projects that have a history of abuses, such as constructing large dams and mining. This latest proposal reveals that the Panel is on board with this strategy, and is more interested in maintaining good relations with Bank officials than ensuring accountability and protecting the world’s poorest citizens from future abuses.