Doing Business Report: Upholding the World Bank brand?

The World Bank brand is under attack. As the world’s largest international financial institution clamors through a controversial reform process, President Jim Yong Kim’s management team is working to convince employees and clients that the new operational structure will be good for business — and worth the noise of implementation. It hasn’t been easy. At the same time, China has entered the development finance fray with a new infrastructure development bank for Asia-Pacific that many see as a threat to the World Bank’s global reign. With so many questions circling about the bank’s future, an annual ranking report that is not part of the new reform structure at all — and which some have argued should be scrapped — has helped prop up the World Bank’s brand name amid the turmoil of reorganization. The annual Doing Business Report, a respected investigation into country-level regulations affecting private sector growth and a ranking of the best and worst economies for doing business, is one of the most successful projects to come out of the bank, according to Daniel Runde, director of the Project on Prosperity and Development at the Center for Strategic and International Studies. “Whatever happens in the reforms of the bank, let’s not kill the secret sauce,” Runde told Devex. Just a year ago, there were questions around whether the Doing Business Report would survive at the World Bank. In 2013, Kim established a panel of outsiders to make recommendations on the report’s future and advocates of the ranking worried that the panel would be biased against them — especially since two of its advisers were known critics. The panel didn’t advise the president to scrap the report, but it did recommend getting rid of the well-known ranking system, a suggestion that Kim hasn’t heeded to date. According to Runde, the Doing Business Report has sparked more than 2,000 reforms throughout its 12 year existence. “Tell me what other initiative at the World Bank or elsewhere has generated that kind of change?” Runde asked last week during a CSIS panel discussion in Washington, D.C. Sara Aviel, U.S. alternate executive director at the World Bank, said the Doing Business Report is one key way the institution can demonstrate its knowledge and expertise. “It’s a very clear guide to concrete things that can be done,” Aviel said during the panel. She explained that the report’s ranking system creates competition among countries and therefore strong incentives for positive reforms that benefit small business owners and entrepreneurs. It also brings the public and private sectors together and presents data as a public good — used by governments, multilateral and bilateral donors, and others. The U.S. Agency for International Development in particular makes use of the Doing Business Report to gauge the success of its own programs. This year’s report demonstrated that developing countries dominate the most improved list for doing business — a number of which have been the recipients of USAID funding and regulatory reform projects. The agency issued a statement highlighting its own contribution to the Doing Business Report’s biggest movers: “USAID supports regulatory reforms in developing countries and is proud to have partnered with several countries in successfully implementing a number of reforms highlighted in this year’s report.” “[The Doing Business Report] is really part of our development objectives,” Paige Alexander, assistant administrator of USAID’s Bureau for Europe and Eurasia, said Friday. Paul Cadario, a former senior manager at the World Bank, told Devex that the report “is an example of something that only the [bank] could do.” He explained that the Doing Business Report is influential in allowing representatives from local private sectors to engage with their governments. “It gives voice to people within countries, the business people in particular, that want to improve how business is done,” Cadario said. While the World Bank’s reforms are moving forward, and the controversy and uncertainty surrounding them are as strong as ever, the Doing Business Report — in addition to other flagship academic publications — has remained largely unscathed. The report is part of the Development Economics Vice Presidency arm of the bank, and as such it is removed from the institutions newly created and controversial global practices system. A bank representative told Devex that distinction is meant to prevent a conflict of interest between bank operations and independent academic assessments. While that may be true, it also means that Kim will have to show that his global practices — and the solutions they impart — can stand on their own, as contributions to a World Bank brand that remains very much in flux. What do you think the Doing Business Report rankings mean to the World Bank and its brand? Share your comments below. Read more development aid news online, and subscribe to The Development Newswire to receive top international development headlines from the world’s leading donors, news sources and opinion leaders — emailed to you FREE every business day.