Management of the World Bank welcomes the Independent Evaluation Group (IEG) report Enhancing the Effectiveness of the World Bank’s Global Footprint. The evaluation is timely because the World Bank continues to enhance decentralization in keeping with its commitments made in the capital increase package of International Bank for Reconstruction and Development (IBRD) and in the replenishments of International Development Association.

Overall

Management notes with satisfaction the report’s finding that decentralization has helped the World Bank deliver many benefits, including the facilitation of a strong response to the coronavirus (COVID-19) pandemic. It is reassuring to note that the World Bank’s “strong presence in client countries” has contributed to “greater responsiveness to clients, more regular operational support for projects, increased trust between World Bank staff and government counterparts,” and has “enhanced collaboration with partners in the field” (ix). Management welcomes the report’s finding of “a strong positive correlation between client satisfaction and the World Bank’s staff presence in lower-income countries” (xiii). The report’s conclusion that “the World Bank’s preexisting field presence, strong sector knowledge, and client relationships facilitated its early coronavirus (COVID-19) pandemic response and ensured business continuity” (xiv–xv) resonates well with management. Management is committed to continuing to further enhance this decentralization model.

In advancing decentralization, management is primarily driven by the need to tailor support to country and program specific needs. Management finds the analysis of the report regarding quantitative targets to be overly simplistic, as multivariate considerations and trade-offs inform management decisions to expand field presence. There are essentially only three quantitative targets in the decentralization discussion: a target for country directors (100 percent in the field), a target for program managers, and a target for the total number of staff based in fragile and conflict-affected situations. These targets were established out of a conviction that decentralizing country directors and program managers will help inform and accelerate operational decision-making, to change staff mind-sets about the benefits of working from the field, and to “pull” lower-level positions from Washington to the field. The fragility, conflict, and violence (FCV) target also responded to shareholder pressure to increase field presence (particularly for International Development Association countries categorized as fragile and conflict-affected situations) and strong country demand for senior and internationally recruited staff (IRS) presence in-country. Actual decisions to hire more locally recruited staff (LRS) or to decentralize to a particular country office various IRS are anchored on data and evidence.

Optimizing decentralization is exceedingly difficult, given the multiplicity of both demand-side and supply-side issues, which constrain the decentralization of staff at the country level. On the demand-side, the specific needs of country programs are the key drivers of the World Bank’s staffing decisions, but those needs are also very fluid.1 Efforts are made to identify current and foreseeable country-level demand to inform annual intermanagerial discussions about workforce planning, staff talent reviews, and unit-level Work Program Agreements. Articulating country needs typically considers the country’s size, complexity, development challenges, government capacity, ongoing and planned operational program, and World Bank Group comparative advantage, together with the staff profiles required to meet program needs. Added factors that are particularly relevant to the deployment of staff in FCV locations include risk management challenges and duty-of-care considerations.2 Once a satisfactory picture of country need is articulated, the decentralization discussion turns to supply-side considerations. In the World Bank’s internal recruitment processes, staff preferences play a critical role, as staff are mostly deployed through an internal competitive market, with staff proposing themselves for consideration for open positions. Moreover, staff moves to new positions are completely voluntary. The achievable staff profile in the field is thus determined in large part not just by country demand but also by supply, as staff respond individually to the relative attractiveness of a specific location. Factors that affect a location’s attractiveness include a country’s perceived quality-of-life, security level, quality of schooling, opportunities for spousal employment, attitude toward diversity (including considerations relevant to lesbian, gay, bisexual, transgender, and queer issues), and international connectivity (both transportation and communication). Given that there are both demand and supply issues to decentralization, it can easily happen that demand points in one direction, but supply in another, with the result that adjustments need to be made in planning. For example, it is often very difficult to attract staff to countries with fragile and conflict affected-situations that have relatively low quality of life (for example, limited markets, high pollution, poor housing), poor in-country medical care, serious security issues (for example, high crime or low to high conflict), limited schooling for children (particularly in languages other than the national language), and limited opportunities for spousal employment, with the result that decentralization to support programs in these countries may often end with stationing staff in a nearby location, specifically, a larger country office headed by a country director or a hub office that supports staff working across a subregion. It is management’s view that a dynamic context-sensitive approach that is guided by aspirational yet realistic corporate targets provides sufficient guidance and flexibility, as shown by the decentralization benefits highlighted in the IEG evaluation.

Management also believes that the budget envelope, which IEG discusses only briefly, is central to decisions pertaining to staff deployment in the field. The IEG report notes at the outset that the cost of decentralization is not part of the scope of the evaluation. That is unfortunate, as it is difficult to have an informed discussion of the effectiveness of the World Bank’s efforts at decentralization without factoring in its costs. The budget envelope is a critical factor in determining staff deployment to the field, making choices to staff vacant positions with LRS, IRS, or third country nationals, and to locate such staff in one location (for example, a country capital) or another (for example, a neighboring hub). Every Region is provided a mobility budget to finance the costs of placing IRS or third country national staff in the field, within which budget trade-offs are made. For example, to service FCV countries at a reasonable cost with strong staff who have other deployment options, Regions often try to attract experienced, senior, technical IRS third country national staff by placing them in more secure and developed locations from which it is relatively easier for them to stay with their families and to travel and cover multiple countries; Country directors are often stationed in such locations for essentially the same reasons. This has the added advantage of helping the regions stay within the overall parameter of their mobility budget. The recent assessments on the Global Mobility Support Framework and the projection on its fiscal sustainability provides an added opportunity for the World Bank to assess and align its decentralization plans with more recent cost projections.

Outcome Orientation

Management believes that the impact of decentralization should be measured in terms of the World Bank’s contribution to long-term high-level outcomes in countries. In contributing to those high-level outcomes, the World Bank combines lending and nonlending instruments and helps deliver results through direct and indirect pathways. As the report states “[b]eing located in-country helps staff build relationships and trust with clients, which helps the World Bank support institutional reforms, cultivate government ownership over the development process, and coordinate strategic priorities with donors by leading multidonor trust funds” (xiii). Management believes that decentralization also helps better link project design to country context and high-level outcomes, strengthens fiduciary oversight and institution building, plays a catalytic role for policy dialogue, and helps the World Bank better align itself with development effectiveness principles in support of country ownership and better donor coordination. Therefore, the effectiveness of decentralization should be assessed taking the long-view of whether relatively short-term staffing decisions have, over time, contributed to the achievement of priority country-driven development outcomes.

Recommendations

Management enormously values IEG’s attempt to gather evidence and lessons regarding World Bank decentralization efforts, and it is committed to reflecting on its many insights to move forward even more effectively. The report provides an important opportunity for reflection and for reinforcing links across different corporate initiatives, for example, the Strategic Framework for Knowledge, the Career Development and Mobility Framework (CDMF) and the outcome orientation agenda. The implicit intended outcomes of the recommendations (namely, evidence-based decentralization process, effective knowledge flows, and fair career mobility for all staff) are indisputable, and in that context, management agrees with the recommendations. Yet, it also believes that the implementation of the recommendations, while helping put more structure in relation to either incipient or informal practices or both, may not result in significant differences in the World Bank’s decentralization decisions.

Recommendation 1: Although management agrees to specify “decentralization’s expected outcomes” and adopt “principles to guide and adjust decentralization decision-making based on evidence” (xix), it cautions that this articulation would make a limited contribution to determining its global footprint in countries of widely differing complexity, diversity, and fluidity of circumstances. The outcomes and principles would have to be expressed at such a high level of generality that, for any specific country, a multiplicity of decentralization actions and outcomes would be compatible with them. There will always need to be flexibility to bring the operational demand for decentralized staff into a reasonable equilibrium with the supply of staff willing and able to serve in the decentralized positions at the time in question. This will continue to be accomplished through the annual workforce planning exercise, as well as internal corporate recruitment exercises, where the World Bank endeavors to map staff who are seeking field assignments with concrete opportunities for deployment into countries that meet their criteria for livability, need their skills and expertise, address Bank Group business needs, and match the availability of resources. With these limitations, management understands that defining overall outcomes and principles of decentralization may facilitate the long-term evaluability of management efforts, serving as a high-level compass for midcourse corrections. To this end, management will endeavor to identify a few outcomes to include in the revised World Bank Corporate Scorecard for fiscal years [FY]24–27. Tracking these through measurable indicators (without necessarily articulating explicit targets) will build a database for long-term tracking.

Recommendation 2: Management concurs with the recommendation to mitigate the risks to knowledge flow brought about by decentralization. Management understands that decentralization can undermine the global knowledge flow and intends to address this under the World Bank’s 2021 CDMF as well as the 2021 Strategic Framework for Knowledge. In particular,

• Management strongly agrees that the World Bank “should continue to promote staff mobility by rotating IRS between headquarters and the field” (xx). The provisions of the 2021 CDMF—both to move operational staff every fourth year on average and to require such staff to have field experience to be promoted from level G to level H—are intended precisely to do so.
• Management is also working to better tailor its knowledge management to support field-based staff (xx), albeit within objective constraints. In this context, management notes, for example, that of the five factors that apparently make Uganda—a country office with 53 resident staff in FY21—a “well-connected country office” (box 4.2, 60), at least two are not affordable or easily replicable in smaller offices (namely, two resident specialists per sector; many high-level visits from technical specialists and management) and a third may not be (namely, providing country office task-team leaders with opportunities to work across countries). In smaller offices—such as the 54 country offices that in FY21 had less than half the number of staff of the Uganda office (30 with less than 10), the World Bank’s efforts need to focus instead on the other two factors, including virtual team building and information exchange (which is cost-effective) and more effective staff mentoring, including by program managers (hence the recent effort to decentralize more program managers). This is then being supplemented with continuing efforts to strengthen online knowledge curation and dissemination (such that today almost any World Bank staff member anywhere can access the full library of Bank Group knowledge); to develop decentralized training and knowledge hubs—especially in Asia (such as in Bangkok and Singapore) but also Africa (Nairobi) to help overcome time differences; to build quasi-formalized communities of practice to share knowledge on specific topics; and to establish operational units with staff and mandates (including outreach and training) dedicated to specific themes (for example, the FCV Group, the Climate Change Group, the Gender Group and the regional Gender Innovation Labs). In the context of COVID-19 and home-based work, the World Bank has also expanded virtual training platforms to help achieve a more continuous knowledge flow between staff in field offices and in Washington. Partly as a result, where headquarters-based staff received more training than country office staff pre-COVID, today they receive equal amounts (albeit in both cases lower amounts overall than was recorded pre-COVID). All that said, it is also the case that more can and should be done, for example, to take advantage of new opportunities for knowledge-sharing and management (for example, machine learning)—opportunities that are being pursued and will be reported under the action plan for the Strategic Framework for Knowledge.

Recommendation 3: Management agrees with the recommendation to support the career development of LRS. Management recognizes that more can be done to strengthen LRS career opportunities and intends to address this under the new CDMF. In management’s view, there are many LRS with operational understanding and expertise that are as extensive as that of many IRS, and, of course, LRS typically exceed IRS in their knowledge of country context and their strong client relationships. Although there are some differences regarding career prospects (mostly due to the limited opportunities for promotion that exist in country offices), most aspects (mentoring, knowledge acquisition, contribution, and exchange, as well as interacting with government, and so on) apply equally to LRS and IRS. In addition, many of the opportunities identified in the IEG recommendations are already available and extensively used, with, of course, limitations due to competing demands on staff time and resources and, at times, due to the absence of a compelling business case (for example, for temporary job swaps). Issues about LRS career development go beyond decentralization and are being addressed in the new CDMF, and as part of the rollout of this framework management will review the opportunities for professional and career growth of LRS staff, in light of IEG’s recommendations. Management also recognizes that LRS professional and career growth cannot be limited to promoting qualified LRS to IRS positions: many LRS do not want to become IRS, yet they are typically interested in and well-suited for broader and deeper in-country or regional roles that play to the strengths of their local presence, and so management will continue to seek cost-effective, business-positive ways to bring such opportunities to them.