The Committee on Development Effectiveness met to consider the report The World Bank Group’s 2018 Capital Increase Package—An Independent Validation of Implementation and Results and the World Bank Group draft management response.

The committee welcomed the Independent Evaluation Group’s validation report on the Bank Group’s 2018 capital increase package, deeming its findings and five lessons relevant and timely for the evolution road map discussions. Members acknowledged that they had not anticipated the frequency, multiplicity, and intensity of crises, and appreciated learning that the World Bank and International Finance Corporation (IFC) had responsibly used their capital infusion to enable a robust response to global and regional crises. Members also appreciated that management had followed up and reported to the Board of Executive Directors on progress made on most of the policy measures and formal commitments. Management reaffirmed its commitment to continue reporting on the capital increase package against the negotiated commitments and indicators (as agreed with the Board in 2020) until FY30, noting that new commitments and indicators will be framed and positioned in parallel with the ongoing discussions on the Bank Group evolution process. They commended management for the positive results related to the implementation of global themes for continuing to serve all country segments; for International Bank for Reconstruction and Development’s delivery to below the graduation discussion income countries; the strengthening of financial sustainability model; and IFC’s capital mobilization, climate, and gender. Members highlighted that there was room for improvement in the areas of private capital mobilization, domestic resource mobilization, partnerships, outcome orientation, operating model effectiveness, creating markets, knowledge, and IFC’s commitment on progress on low-income countries and countries affected by fragility, conflict, and violence.

Members underscored their support for the report’s conclusions that success was best achieved by the World Bank and IFC where corporate initiatives had demonstrated senior leadership buy-in, clear corporate strategies or action plans, organizational champions, dedicated units or other supportive arrangements, well defined indicators with targets, and robust and candid reporting to the Board. They encouraged management to embrace these lessons and appreciated management’s positive responses. Members requested World Bank management to develop domestic resource mobilization outcome-oriented commitments and indicators, noting that the discussion should hinge on growth, reforms, and taxes, and on finding qualified internal talent. Some suggested management use the International Development Association targets. They also asked about management’s plans to reassess the flag and tag methodology on Bank Group’s interventions, noting their interest in also having measurable outcomes on human development, digitalization, and the youth agenda. Management explained that the gender tags and flags played an important role in sharpening the focus on gender during the project design stage, clarifying that, as part of the new Gender Strategy, clearer metrics are being developed and would be reflected in the new Bank Group Corporate Scorecard.

Some members noted they would like to see improvements in the implementation of knowledge creation and innovation particularly about countries above the graduation discussion income. They asked management to explain the main constraints for improving internal organization models. Members requested that Independent Evaluation Group and management share their views on organizational processes to select, prioritize, and monitor Bank Group’s convening work. They underscored the importance of better integrating long-term dimensions to achieving sustainable progress, of better aligning staff incentives with corporate priorities, and to having candid reporting, acknowledging that the Board has a role to play in enabling candid discussions. There was a call for having a Board discussion on Independent Evaluation Group’s capital increase package validation report.