The evaluation also proposed a series of detailed measures for enhancing IMF governance specific to each of the main governance bodies. See Appendix 1 for a complete list of recommendations and implementation status.

On the heels of the first G20 Leaders’ Summit in November 2008, the G20 announced the formation of Working Group 3: Reforming the IMF, which was tasked with advancing the actions covered in the November 2008 Leaders’ Declaration on the reform of the IMF. The agenda included numerous issues beyond supporting quota and voice reform. See the G20 Working Group 3: Reforming the IMF, Final Report, March 4, 2009.

Member country voting power at IMF is calculated by aggregating quota-based votes and basic votes. The total number of basic votes are divided equally among all members. Thus, the allocation of basic votes ensures a minimum voting power for all members.

During their 2009–10 discussions on quota and governance reforms, EDs believed that consolidating the Board to 20 chairs was unlikely to lead to efficiency gains and that any larger reductions could compromise representation. A majority also believed that there should be an amendment to the Articles of Agreement to enshrine the size of the Board at 24. In their view, this number struck the right balance between efficiency and representation while the need to vote every two years to dispense with the default size of 20 chairs as laid out in the Articles of Agreement was unhealthy for the institution. Ultimately, EDs did not recommend amending the Articles; however, Resolution 66–2 included a commitment by the membership to maintain the size of the Board at 24.

ED positions have been calculated taking into account rotation agreements for the position of ED within multi-country constituencies. For instance, if a member country which previously had held an ED position permanently now shares the ED position equally with another member country on a rotating basis, it is counted as having given up 0.5 ED positions.

The WEO currently classifies the Czech Republic, Estonia, Latvia, and Lithuania as advanced economies (in 2010, the Czech Republic was also classified as advanced, while the Baltic countries were classified as emerging market economies). Using this classification would yield a transfer of 1.33 ED positions. However, the country groupings used in quota reform discussions since the 1999 11th Review still classify the Czech Republic and the Baltic countries as EMDCs, which would yield a transfer of 1.64 ED positions.

The Board approves an OED budget envelope each year and allocates resources within this envelope to individual offices.

At a maximum, the adjustment could support the equivalent of one additional Senior Advisor and one Advisor.

Recommendations relative to EDs and Alternate EDs received little to no support from the Board. As for recommendations relative to Senior Advisors and Advisors, the adoption of uniform standards was viewed as difficult to implement, and there was little support for introducing a simple evaluation system that would focus on development and broad assessment. While voluntary guidelines listing the duties and responsibilities of Senior Advisors and Advisors existed at the time, the Working Group report noted that they were not well known and were rarely used.

The Work Program is published twice a year and sets out the Fund’s policy and administrative work to be delivered in the next 6–12 months.

According to the Rule of Silence, silence of an ED on an issue at a Board meeting (in a Gray or oral intervention) is normally interpreted as agreement with the thrust of the staff report appraisal or staff recommendations.

The 2008 evaluation noted the need to better reflect minority views in SUs. An EDs’ Working Group on SUs was established in March 2012 as part of the MIP in response to the 2011 IEO evaluation report on the IMF’s Performance in the Run-Up to the Financial and Economic Crisis (IEO, 2011), which reiterated that the issue still warranted attention.

Decision No. 14498-(09/126), adopted December 17, 2009; effective March 17, 2010.

The policy related to Fund documents classified as “Secret” or “Strictly Confidential” as of the date of the Decision was not changed. In publishing the Decision, the Fund noted that this consent would be granted in all instances except where it was determined that the material remained highly confidential or sensitive (IMF, 2009), although the classification criteria have not been made public as called for by the 2008 evaluation.

As noted in IEO (2015), EDs expressed skepticism at the time about formal Board self-assessment. Many EDs believed that any such assessment should be narrowly constructed and carried out by the Agenda and Procedures Committee. Some questioned the need for self-evaluation by the Board—and whether it is appropriate—given that Directors are accountable to country authorities. Nonetheless, they expressed interest in practices at other IFIs (IEO, 2015). Following discussion of the IEO Self-Evaluation report, in 2015, a Working Group for the Performance Feedback Exercise between the Executive Board and the Managing Director recommended that the Board carry out a self-evaluation on a pilot basis starting in 2016.

Since 2016, the performance feedback exercise between the Board and the MD has included four elements: an assessment of the MD by the Board, the MD’s views regarding the performance of the Board, a self-assessment by the MD of her performance as chief of the operating staff, and a self-evaluation by the Board.

Since the founding of the Bretton Woods institutions in 1944, the MD of the IMF has always been from an advanced European country, while the President of the World Bank has always been a U.S. national.

In September 2009, Directors reaffirmed their view that the selection should be open, transparent, and without regard to nationality. They also recognized that changing the prevailing arrangement at the IMF might necessarily involve reform of the selection of the heads of all international financial institutions (IFIs). At a September 2009 summit, the G20 Leaders also called for an open, transparent, and merit-based process for selecting heads and senior leadership of all IFIs. In October 2009, the IMFC announced its intention to adopt such a process at its next meeting.

The selection of the MD is overseen by the Board. The process and terms of selection followed since 2011 have been incorporated in the Compendium of Executive Board Work Procedures.

For comparison, Mr. Strauss-Kahn was selected in 2007 from a list of two nominees, one from an EMDC; Mr. de Rato in 2004 from five nominees, including three non-Europeans; and Mr. Kohler in 2000 from three nominees, including two non-Europeans (see Peretz, 2009, for more detail).

The First DMD (the sole DMD position before 1994) has always come from the United States; there have been four successive DMDs from Japan since 1994 and two successive DMDs from China since 2011. Other DMDs have come from a broader range of EMDCs (including Brazil, Chile, Côte d’Ivoire, India, and Mexico).

The Dean of the Board, in consultation with EDs, has established a small Working Group to conduct the performance feedback exercise. As discussed above, in keeping with the changes made in 2015, the accountability framework for the MD was modified in 2016 to include the Board self-evaluation component.

The first two IMFC Chairs were advanced economy finance ministers whose terms could continue to the end of their national term of office.

Response rates were: 29 percent (59 responses) for OEDs (henceforth “Board survey respondents,” that is, EDs, Alternate EDs, Senior Advisors, and Advisors); 39 percent (137 responses) for senior staff (B1–B5 levels); and 17 percent (77 responses) for country authorities. The complete set of survey results can be found at IEO-IMF.org.

Currently, the two African chairs at the IMF Board represent 46 countries.

The spectrum of authorities’ views about representation seems to be broad. Some authorities believed the legitimacy of the Fund would be strengthened if a representation system closer to that of the United Nations (i.e., based on the principle of one country, one vote) were to replace the current quota-based system, while others believed that it is appropriate for creditor countries, who provide most of the financing for the IMF, to have a greater say.

Some EDs pointed to the European Central Bank representative’s observer status in Board meetings as an example of preferential treatment.

Specific examples cited by many EDs where EMDC chairs had played a significant role included Board discussions on the governance and anti-corruption framework and IMF debt limits policy.

In the words of a former ED, the Board’s approval or endorsement transforms staff’s analytical work on policy, surveillance, and lending operations into an official position taken by the international community.

Since the 2008 evaluation, the reductions in time devoted to formal discussions on policy (from 23 percent to 12 percent) and bilateral surveillance (from 23 percent to 17 percent) was also marked, again reflecting the shift to informal sessions and, in the case of country items, the increase in the use of Lapse of Time (LOT) procedures.

As a result of complaints that arose in the context of the approval of the IMF-supported program for Greece, the Board approved the proposal in the MIP in response to Board-endorsed recommendations for the IEO’s 2016 evaluation The IMF and the Crises in Greece, Ireland, and Portugal that transcripts of informal meetings would be made available to EDs and retained indefinitely. This change has recently been incorporated in the Compendium of Executive Board Work Procedures, which also notes that pursuant to the Fund’s Archives Policy, unless classified as Strictly Confidential, transcripts are permitted to be disclosed after 20 years.

In its evaluation update on structural conditionality, IEO also found that strict limits on the length of reports have at times led to EDs not being provided with essential information that they need to make decisions (see IEO, 2018).

A desk review of internal documents shows that most OEDs have consistently underspent their allocated budget over the past years. However, this does not necessarily mean all OEDs have sufficient capacity and resources to deliver on the work program needs of their office.

There was a great disparity in the distribution of programs across constituencies between 2008 and 2017. Nine out of 24 constituencies did not include any member country with an IMF-supported program. Among the remaining 15, the intensity of their engagement varied between 2 programs (or a total of 22 program months) to 53 programs (or 1,309 program months). See Appendix 3 for further details.

The length of EDs’ tenure is decided by the authorities of each constituency. This decision (particularly in the case of multi-country constituencies) may present a trade-of between the benefit for the membership and the Board as a whole of having experienced EDs who are well versed in the ways of the IMF and countries’ interest in having their own nationals (or specific individuals) representing them at the Board.

Just over half of Board survey respondents reported having attended SEC induction, while nearly one-third only received information in writing. One-third reported using the online training resources provided by SEC, while 17 percent reported that online training resources had been their primary source of training.

According to the Fund’s Rules and Regulations, the Board’s agenda shall include any item requested by an ED. While the Chair is required to schedule a meeting at the request of any ED, the MD, as Chair of the Board, determines when to schedule such meetings.

In this respect, some EDs reiterated the findings of the 2008 evaluation that the Board should play a more active role in the selection of the Secretary and the Legal Counsel, given their role in serving the Board.

According to the Compendium of Executive Board Work Procedures, comments and requests for changing a draft SU must be grounded in the record of the Board meeting (i.e., Grays or a meeting transcript available soon after the meeting). Requests for changes can be accommodated only to the extent that they are consistent with that record and regardless of the number of Directors supporting them. It also bears noting that the SU is the Chair’s Summing Up and is prepared under the MD’s authority.

Instances of these problems have previously been analyzed by the IEO, for example, in the context of decisions made during the 2010 IMF-supported program for Greece (see De Las Casas, 2016).

Four-fifths of Board survey respondents believed the process is not open or transparent or both, and only about one-third of authority survey respondents believed it to be open and transparent.

In the corporate world, the roles of Board chair and CEO have increasingly been separated. While the governance needs of corporates and public institutions are somewhat different, it is worth noting that several central banks also now prevent their governors from playing this dual role. For example, the Governor and Deputy Governors of the Bank of England have been prohibited since 2012 from chairing the Court of Directors. Similarly, the Governor of the Reserve Bank of New Zealand no longer serves as the chair of the oversight board.

Survey results also indicated concerns regarding the effectiveness of the accountability framework for Management. Only 17 percent of Board respondents believed that adequate mechanisms are in place and used to evaluate the performance of Management. Despite this low level, the Board’s positive perception has improved since 2008, when only 2 percent of respondents thought adequate mechanisms were in place and used.

Note, however, that this is not always the case, even on highly controversial issues like exchange rate policies and trade policies where subtle but significant differences in wording have emerged from two distinct drafting processes although many individuals in the room may be the same.

The Committee on IMF Governance Reform was chaired by Trevor Manuel and included Michel Camdessus, Kenneth Dam, Mohamed El-Erian, Sri Mulyani Indrawati, Guillermo Ortiz, Robert Rubin, Amartya Sen, and Zhou Xiaochuan.

One item that did not gain the support of the MD and which the Chairman of the EDs’ Working Group agreed to defer at the time was the Working Group recommendation to create a new EDs’ working group on the selection, performance assessment and dismissal of the General Counsel and proposing that as an intermediate step the MD follow the World Bank procedure to invite the Board to participate in the search and selection for the General Counsel.

The analysis of Board activity indicators is comprised of estimates, using SEC data. As a result of the Board efficiency reforms instituted in response to the 2008 evaluation, there were changes to the Board workload indicator data methodology. Therefore, the analysis covers 2010–17 to accurately reflect changes since the 2008 evaluation. Although the data for 2009 was compiled after the 2008 evaluation, it is based on the same methodology used for the period covered by the 2008 evaluation.

Broadly defined to encompass meetings not on country items or administrative issues.