End in sight for World Bank's controversial reforms

In an internal email to staff distributed Tuesday, World Bank President Jim Yong Kim set an end date for his reform agenda and announced that the global financial institution will provide more open-ended contracts for its employees — part of a new framework that supports the career development of staff.

Kim recognized that the change process hasn’t been easy, but stressed that it was “essential” to ensuring the bank could effectively fulfill its mission to fight global poverty.

“The past year has arguably seen some of the biggest changes to affect staff in the history of this institution,” he wrote in the email, a copy of which was obtained by Devex. “We needed to reorganize to make sure that the vast amounts of knowledge in our ranks can spread and be used in any country that asks for our help in finding a solution to a development problem.”

While each part of the change will be carried out at different times, Kim set the end of this fiscal year as a deadline for the implementation of all reforms, including any potential job cuts.

The bank’s nonoperations group earlier identified 250 jobs that will be on the chopping block, according to Kim, and affected staff would either have been informed by now “or will be by the end of March.”

More jobs may still be on the line, however. Regional and global practices units last week identified the final $100 million in required savings, which include further staff reductions in the operations groups. Kim said these cuts will also be announced by the end of March.

The World Bank president meanwhile stressed that the financial institution is intent on providing high-performing staff with better career options.

“The World Bank Group’s greatest asset is its staff; there is no better collection of people in the development field in the world,” Kim asserted in the internal email. “I have come to fully appreciate that if we are to continue to attract and retain the best talent and ensure a diverse workforce, we must offer careers, not jobs; security, not ambiguity.”

One way to do this is to add more open-ended contracts in July — a move that is likely to earn praise from World Bank staff. Unlike in similar organizations where fixed-term contractors account for just 20 to 30 percent of the total workforce, 52 percent of World Bank staffers are on fixed-term contracts — and this figure has been growing 4 percent annually, according to Kim. Fixed-term contracts cover two, three and five-year periods, as well as contingent contracts for short-term consultants.

Kim has tasked Sean McGrath, bank vice president for human resources, to develop a proposal that sets a clear road map for “staff to be offered open-ended contracts based on business need.” This proposal, which will include a new program for administration and client support staff, is due by the end of May.

Further, the bank’s two-year review of employee packages is about to end. The review has so far resulted in a change in the mandatory retirement age to 67 years, improvements in the pension plan and an alignment of life insurance options in country offices with those in the bank’s Washington, D.C. headquarters.

And while the bank finalized its senior leadership of global practices last year, there remain several operational issues that need to be tackled. These include providing clarity on accountability and decision-making roles, as well as “streamlining quality assurance and portfolio monitoring.”

Kyle Peters, senior vice president for operations at the World Bank, has been tasked with fixing these problems, alongside Managing Director Sri Mulyani Indrawati.

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