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Governance: Sound Development Management

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Resource implications

Enhancing the governance dimension of its development assistance will have resource implications for the Bank. These would cover (i) staffing, (ii) staff training, (iii) staff consultants (for economic and sector work), (iv) business travel, and (v) loan and TA resources, which are discussed briefly below.

The Bank will need to build up its own institutional capacity for analyzing, assessing, and addressing governance issues in DMCs. This will require strengthening of the in-house expertise available to the Bank in the various aspects of governance and institutional development. However, given the current budgetary constraints, any new staff positions required would have to be accommodated through the ongoing redeployment efforts within the Bank. The Strategy and Policy Office (SPO), which has been designated as the Bank’s interim focal point for capacity building in DMCs,²⁹ and the Office of the General Counsel (OGC) will be responsible for formulating policy and guidelines on governance matters.

Current staff, as well as new staff, in the operational departments/offices will have to be sensitized to and trained in the various aspects of governance related to Bank activities. The Bank has already started conducting staff training seminars on topics such as (i) strategies for institutional development, (ii) privatization and market regulation, (iii) incorporation of participatory approaches into project design and implementation arrangements, (iv) cooperation with NGOs, and (v) legal issues of operational interest to the Bank.³⁰ These programs will continue, and new ones will be added as the focus on governance sharpens. As is the case at present, Bank staff will serve as resource persons, to the extent feasible; nevertheless, there will continue to be a need for external consultants, especially for the more specialized subjects. In order to cater to these requirements within the Bank’s training budget, activities of lower priority will have to be reduced.

The Bank’s governance initiatives will be articulated through the Bank’s existing modalities and activities, i.e., country and sector documents, and loan and TA projects. Addressing governance aspects in these contexts may add to lead times and complexity, as do other issues of Bank concern, such as women in development and environmental protection. It is difficult to estimate the resource increases necessary to do so. However, in several areas, the Bank is already carrying out the work involved (e.g., participatory approaches to project design and implementation), and, in some cases, has been doing so for a long time (e.g., public enterprise reform). Hence, any extra expenditure, in terms of staff time, business travel, and loan and TA resources would be adjusted and reflected in the relevant allocations made in the Bank’s three-year rolling work program and budget implications.

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