Gloria M. Grandolini on the World Bank Group's 'merger'

By Bill Hinchberger 18 November 2015

The World Bank headquarters in Washington, D.C. Photo by: makzhou / CC BY-NC

Senior director for the finance and markets global practice at the World Bank Group, Gloria M. Grandolini has been on the frontlines of the group’s controversial recent reorganization.

During a recent interview in Paris, where she gave Devex the inside track on a novel tool for rural development called index insurance, Grandolini also took time out to discuss the reform. In her global practice, it united roughly 350 employees from the World Bank and another 150 from its private sector arm the International Finance Corp. under a single umbrella. “Basically it was a merger,” she said.

Grandolini pointed to the bank’s Global Index Insurance Facility as an example of an initiative that has benefited from the reform. “This is relevant to insurance,” she said. “It is important to have that capability and skills mix.”

Index insurance: What you need to know

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Prior to the reform, staff members were organized along geographical or product lines. Now everyone reports to the bank’s “practice managers,” who oversee things along regional lines and according to three main thematic areas: building deep, diversified, stable financial systems and markets; financial infrastructure and access; and finance for development.

“Our biggest value added is global expertise, but the old structure didn’t make it easy to provide,” Grandolini shared.

Here are some highlights from the conversation with Grandolini about the nuts and bolts of the group’s overhaul:

What were the main elements of the reorganization?

Within our practice, we completely restructured groups that were previously operating very much along geographical or product lines. We aligned everything into the three thematic areas, which we feel are responsive to the needs of our client countries and the global community. Our practice is very involved at the global level. For example, we have seats on the Financial Stability Board and several international standards-setting bodies.

Can you talk more about the thematic areas?

One involves building deep, diversified, stable financial systems and markets. There we have the experts who cover financial sector oversight, financial sector integrity, anti-money laundering, illicit capital flows, and capital markets. Their work involves building bond and equity markets. It basically covers the regulatory and supervisory functions — including, among other things, how to build insurance markets.

A second area has to do with financial infrastructure and access. You can have the most perfect financial system, but it won’t play the role we want if firms and individuals don’t have access. Here most of the staff came from IFC because they’ve worked on payments systems, credit systems, credit bureaus, and moveable collateral. We’re also working on financial inclusion for individuals. That’s a big deal for us because [World Bank] President Jim Kim has set a target to ensure universal access to transaction accounts by 2020. We still have 2 billion people left to go.

Another area is new in the sense of having a formal infrastructure: the role of financing in contributing to the formal economy and to other sectors. We picked four areas where we have a lot of demand and interest, but we see this evolving over time. The ones we have now are infrastructure finance, housing finance, disaster risk finance and insurance, and agricultural finance and insurance. That’s where our work on index insurance fits.

Overall we’re trying to build deep, diversified, efficient and inclusive financial systems. We’ve given priority to reducing poverty and fostering shared prosperity. That’s where the work on insurance becomes so important. We know for sure that natural disasters and climate change hurts the most vulnerable the most.

How is the restructuring working in practice?

It is the same challenge whenever you want to pool sets of expertise. It’s about being more than the sum of the parts.

At the beginning it was hard, as hard as it can be, to pull together two cultures, two systems, with people who were used to working in a certain way. After a year, we’re beginning to have good examples like [index insurance], where it is working.

I have been in the bank for 26 years, and this is the largest restructuring I’ve lived through. When I decided to apply for this job I knew it was going to be a challenge, but I felt that it was really the way the organization had to go.

What were some of the biggest challenges?

The World Bank was more used to working with governments, longer-term kind of work. A combination of finance, knowledge, and convening. It was used to longer-term engagements, with ups and downs. On the IFC side, it was very much more short-term, project-focused types of interventions.

The challenge has been to pull them together so that one reinforces the other. And to have integrated teams comprised of people who were used to doing things differently. Those used to working with the public sector side might give the perception of being more bureaucratic, but they know how to work with governance systems that are often very complex. On the IFC side, the results framework has been very focused. It is very well developed. That’s great because we have a lot to learn coming on the bank side. There are good things on both sides that we’re beginning to pull together.

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About the author

Bill hinchberger
Bill Hinchberger@hinchberger

Bill Hinchberger is Devex's Paris correspondent. In his spare time, he's a freelance writer, communications consultant and educator. A native of California, he lived in Latin America for over two decades, reporting for media such as The Financial Times and Business Week. He also served as president of the São Paulo Foreign Press Club and founded the online travel guide BrazilMax.com. Assignments have taken him to over 30 countries, from Cuba to Egypt, India, Kenya, Turkey, and beyond.


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