World Bank pledges ‘no regression’ as it weighs accountability overhaul

“No dilution, no regression,” a key World Bank board member vowed, signaling that any overhaul of the institution’s accountability system will preserve existing powers while integrating a new remedial action framework for the bank’s private-sector arm, the International Finance Corporation. Parameswaran Iyer, executive director representing India on the World Bank’s board, told civil society representatives Thursday that the task force examining possible reforms would prioritize strengthening, not weakening, the bank’s accountability architecture. “Those key principles of no dilution, no regression — they are at the heart of this,” Iyer said during a panel session during the World Bank-International Monetary Fund annual meetings in Washington last week. “If part of this leads to an integrated remedial action framework, to me, prima facie, that would make sense,” he later added. His comments come after the board established an independent task force to assess whether the bank’s three existing complaint mechanisms — the Inspection Panel, the Compliance Advisor Ombudsman, or CAO, and the newer Dispute Resolution Service, or DRS — should be merged or better coordinated. Currently, each mechanism has its own staff, policies, powers, and procedures. As chair of the Committee on Development Effectiveness, or CODE, at the Board, Iyer will be leading the process. The review forms part of the World Bank President Ajay Banga’s broader drive to make the lender “smarter, faster, and more responsive,” and to streamline overlapping functions across its public and private-sector arms. The bank’s accountability mechanisms exist to give communities an opportunity to hold the institution accountable when things go wrong in projects it has directly or indirectly funded. This includes environmental and social harms such as pollution of rivers or sexual abuse. Their complaints to the various mechanisms can trigger compliance investigations and also facilitate dispute resolution. IFC has also started piloting a new approach, which offers remedy to harmed communities, although it stops short of direct financial compensation — something that civil society groups continue to push for. Civil society groups welcomed Iyer’s remarks but expressed caution. While not opposed to a merger in principle, they warn that combining the mechanisms could — if not done properly — limit accountability or weaken communities’ access to remedy. “For an ambitious One World Bank Group, you need a state-of-the-art accountability mechanism to underpin it,” said Margaux Day, executive director at the Accountability Counsel, a San Francisco-based advocacy nonprofit focused on supporting communities harmed by internationally financed projects. “There’s potential for improvement, but efficiency can’t become a weapon to limit effectiveness,” she added. Advocates also emphasized the need for consultation with staff from existing mechanisms and affected communities. Efficiency vs. independence Asked about the timing of the review — coming just months after the board opted to split DRS from the inspection panel after a lengthy review process — Iyer said borrowers and communities remain confused about how to access the bank’s multiple accountability systems. “There is some confusion and lack of knowledge … so there was some indication that it would be good to have some consistency. Can we have a single-window concept?” he said. The merger discussion is also linked to the ongoing wave of reform within the bank initiated by Banga, Iyer said. Banga has already announced plans to consolidate the bank’s knowledge teams and align the environmental and social safeguards, or ESF, function across all its institutions — IBRD, IDA, IFC, and MIGA. The goal, he said during a civil society town hall earlier this week, is to ensure consistency and early detection of risk. “What we’ve done is take the ESF function across the institution, bring everyone together in an effort to get as much commonality,” Banga said. “Makers” will design projects with appropriate safeguards, while “checkers” will monitor implementation using satellite data, social media, and grievance channels, he explained. However, Iyer was keen to emphasize that the accountability review is board-led and separate from management’s reforms, although both reflect the same push for integration and modernization. Focus on remedy The review comes as IFC faces continued pressure over its legacy investments in Bridge International Academies in Kenya and the Tata Mundra coal project in India. Both drew criticism over harm to communities and gaps in IFC oversight. In response to these cases, and others, IFC launched a Remedial Action Framework, finalized this year, to strengthen how it addresses project-related harm. While not perfect, the framework was welcomed by civil society as the first explicit remedy policy to be adopted by a development finance institution. Now, advocates want to see IFC’s landmark remedy approach institutionalized across any potential new accountability mechanism at the bank. “What we need is a one World Bank Group approach to remedy,” David Pred, executive director of Inclusive Development International, an organization that helps protect communities from harmful investment projects, said during the session. The heads of the bank’s existing accountability mechanisms agreed. Speaking on the panel, Ibrahim Pam, chair of the Inspection Panel, said: “The goal of any compliance process should result in remedy, which should result in justice. Otherwise, what’s the point really?” Janine Helene Ferretti, director-general of the Office of the Compliance Advisor Ombudsman, added: “I think we could see a need to see a closer link between accountability and remedy.” “There’s got to be more than just lessons learned in this,” she added. During his closing remarks, Iyer reassured advocates that the review process could deliver improved efficiency without compromising accountability or communities’ access to remedy. “The whole purpose of this is to improve the effectiveness of the accountability mechanism,” he said. Update, Oct. 21, 2025: This article has been updated to clarify that Margaux Day is the executive director at the Accountability Counsel.