Address by ADB President Takehiko Nakao at the Town Hall with the President on 17 September 2018, ADB Headquarters, Manila, Philippines
Thank you for joining the town hall meeting. It is gratifying to see the participation of so many people from headquarters and our resident missions.
Our last town hall was in September 2017. At that time, I spoke on ADB’s work to develop a new long-term strategy to respond to the changing needs of Asia and the Pacific.
After an extensive consultation process, including with staff and stakeholders, the ADB Board of Directors approved Strategy 2030 in July 2018. This strategy will guide us in achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining efforts to eradicate extreme poverty.
When I visit developing member countries and talk to their leaders and ministers, I always feel that their expectations of ADB are very high. Their demands are becoming ever more sophisticated and they span different sectors and themes.
Our developing member countries value ADB as a comprehensive provider of finance, knowledge, partnerships, and project development. And our role as a policy advisor for economic management and structural reforms is gaining importance.
In our projects, ADB will need to provide new and innovative solutions for our clients. Drawing on our highly talented workforce and enduring partnerships with developing member countries, ADB is in a unique position to deliver much-needed development knowledge and expertise that is tailored to country situations.
Based on our 52 years of experience, we can enhance partnerships between countries, institutions, and the private sector. Our role in the region is more important than ever before. This is an exciting time to be part of ADB.
II. Delivering on Strategy 2030
Over the past half century, Asia and the Pacific has made great progress in poverty reduction and economic growth. Yet, many challenges remain, including the mega trends of climate change, environmental stress, urbanization, aging, and rapid technological advancement. Our region also has many economic and political developments which add to its dynamism and complexity.
Strategy 2030 sets the course for ADB to respond to the region’s changing needs. The vision is very ambitious, and we must now shift our focus to implementing the strategy.
Today, I would like to highlight five ways in which we, individually and collectively, will deliver Strategy 2030.
First is innovation. Innovation is important in addressing the complex problems our developing member countries face. When we think of innovation, we should seek to add value.
Innovation is taking many forms in our operations. This includes the incorporation of new ideas and advanced technologies, including information technology (IT), in infrastructure, education, health, finance, agriculture, and all other sectors. Innovation also includes, for instance, the development of new approaches to more effectively promote gender equality in our projects and programs. And, it includes our entry into frontier markets through private sector financing.
Innovation is also changing the way we work at ADB, enabling us to deliver services more efficiently and effectively. Under Strategy 2030, I encourage staff to challenge the traditional way we have been doing things and to find new ways to work in a more agile, streamlined manner. We must remove red tape.
According to the Staff Engagement Survey (SES) results, our scores are low in three critical areas for innovation. These are (1) staff do not feel comfortable speaking up and voicing their opinions and suggestions; (2) it is not easy for people to challenge our traditional ways of doing things; and (3) people are discouraged from taking calculated risks. These must be changed.
Managers across ADB must lead the change. When the traditional way of doing things does not fit in today’s context, managers should work to fix this. The most important role of a manager is not just to continue business as usual in a reasonable way, but to have the boldness and will to effect change. Managers must encourage staff at all levels to voice their ideas. They should recognize the efforts of staff to take calculated risks and provide additional value.
There is an understandable dilemma that if we pursue volume and number of projects, it is not easy to incorporate advanced technology, innovation, and new ways of doing things. I wonder whether this dilemma is a total tradeoff or not. I believe that we can pay more attention to innovation without sacrificing numerical targets too much.
To encourage staff to be more innovative, I have asked SPD (Strategy, Policy and Review Department) and BPMSD (Budget, Personnel and Management Systems Department) to consider how we can better recognize innovation in our corporate results framework as well as the performance review of staff.
Second is knowledge institution. Under Strategy 2030, we will strengthen ADB’s role as a knowledge provider. We will produce knowledge products and services that are relevant for our clients. We will support our developing member countries in such areas as evaluation, anticorruption, integrity, laws, risk management, and treasury operations. We will also actively promote knowledge partnerships.
In addition to explicit knowledge, our hallmark is tacit knowledge, which can be delivered through our operations. Our work is highly appreciated because we are able to apply and share the knowledge we gain from our work in countries across the region. Today, I am happy that many developing member countries are very keen to build knowledge and share it with other countries through South–South cooperation.
We also need to strengthen our ability to harness and share knowledge across ADB. Sector and thematic groups are key. We need closer communication and understanding between operational departments, ERCD (Economic Research and Regional Cooperation Department), SDCC (Sustainable Development and Climate Change Department), DOC (Department of Communications), IED (Independent Evaluation Department), ADBI (Asian Development Bank Institute), and others.
Third is One ADB. We will need to work as One ADB to deliver Strategy 2030. We need to break down silos and remove barriers to cooperation and collaboration. We must promote greater synergy and complementarity between public and private sector operations, sector and thematic groups, knowledge and operational departments, and across all offices within headquarters and our resident missions.
In particular, I call on regional departments, PSOD (Private Sector Operations Department), OPPP (Office of Public–Private Partnership), and ORM (Office of Risk Management) to substantially strengthen their collaboration to support the expansion and diversification of our nonsovereign operations and PPP operations.
We must fully integrate private sector financing and partnerships into our country partnership strategies, and engage the sovereign side closely, especially when assessing development impact and analyzing sector and thematic strategies for our countries. SPD is working on guidance to support collaboration between PSOD and regional departments.
Fourth is digital transformation. Digital technology is rapidly developing in diverse fields, resulting in profound changes to the way we live, work, interact, and do business. Using new technologies, ADB is strengthening our procurement and financial management, human resource administration, and communications between staff.
As I discussed in my opening address at the Digital Development Forum 2018, which was held at headquarters earlier this month, ADB is starting to incorporate digital technologies in many areas of our operations, including the fields of education, health, and fintech. And, moving forward, we will deliver integrated solutions in such areas of “smart cities,” “e-government,” and “e-commerce” using digital technologies.
In addition, we are actively harnessing the use of digital technology across our institution. We have already strengthened IT mobility, cloud platforms, and IT resilience. And, in the coming years, we will double our efforts in the following five areas.
One is to replace our aging IT systems with modern technologies. This includes replacing the mainframe which has served us for nearly 40 years. Two is to automate business processes and dramatically modernize procedures. Three is to strengthen data governance, including a standardized data definition. Four is to further enhance remote IT access so that staff in headquarters and field offices can work from anyplace and anytime. And last is to further strengthen cybersecurity and IT resilience.
Stronger hard and soft IT infrastructure will greatly improve our efficiency and effectiveness, and facilitate the building and sharing of knowledge. At the same time, changing our mindsets is equally important to make the best use of new digital platforms.
Fifth is being closer to our clients. ADB’s network of field offices and our close partnerships on the ground with clients are vital to our mission and will become even more important in the years ahead. Our resident missions represent all of ADB, including sovereign and nonsovereign operations.
In addition to project-related issues, our resident missions also need a wider perspective to look at economic and policy issues in our developing member countries. Resident missions have an increasingly important role in leveraging ADB’s knowledge work. We will continue to strengthen our field presence and corporate support for resident missions.
III. Investing in our staff
Next, let me discuss how we invest in our staff in support of Strategy 2030.
Thank you once again for your participation in the 2018 SES. 96% of you shared your views. The results announced in August show an overall increase in the level of Sustainable Engagement across ADB. There was improvement in 12 out of 18 categories, including Leadership and Management, Performance Evaluation, Communication, and Career Management. These are areas where we have invested significantly since 2015.
The survey also identifies areas where improvements are still needed, including Innovation, which I already have discussed; Empowerment; Working Relationships; Diversity; and Efficiency. Management is committed to working with you on improving staff engagement and the way we work at ADB. I would like to ask everyone to play a role in improving our performance in the areas we need improvement.
Now, I would like to talk about four key human resources initiatives which we will continue to invest in.
First is career development. We are promoting staff mobility to strengthen opportunities for career development for staff themselves and to enhance collaboration and knowledge sharing between departments. Under the mobility framework, the rotation program and recently launched short-term assignment program provide opportunities for staff at headquarters and in resident missions to broaden their skills and experiences in different locations, functions, and departments. ADB will continue efforts to strengthen and expand mobility across departments and resident missions.
I believe that mobility is good for career growth. Reflecting on my own career at the Ministry of Finance of Japan, every time I was assigned to a new job, I felt like I was pulled out of my familiar environment and found it challenging to re-start everything. But always it turned out that the new work gave me the opportunity to widen my expertise and provide fresh perspectives. I became excited to do new works.
Second is diversity and inclusion. We continue to build a diverse and inclusive workforce. ADB has zero tolerance for bullying and harassment. I expect all staff to foster a respectful workplace. We continue our efforts to support gender equality. For the first time, we have attained over 35% women IS representation. We are making progress in recruitment. In 2017, 63 out of 163 new IS recruits, or 39%, were women. This year so far, 41 out of 88 new IS recruits, or about 47%, were women. I have appointed many women to senior positions. Today, 25% of our IS 9–10 senior staff are women. I urge all managers to continue efforts to further strengthen gender equality in our workplace and to build an inclusive culture in their teams.
Third is performance management. The new performance review framework has a stronger link between ADB objectives and individual work plans, as well as more frequent feedback. The 360-degree assessment for all IS7–10s in management roles is helping strengthen our leadership. We are also providing training to guide supervisors and staff on how to have constructive performance discussions.
Fourth is the importance of giving learning opportunities to staff. ADB will invest in the training and development of our staff, emphasizing in particular leadership, communication, collaboration, innovation, and change management. Our training courses within the bank and external courses will strengthen knowledge of new technologies and approaches, deepen understanding of synergies between private and public sector operations, and upgrade skills in economic and financial analysis. ADB will make greater use of technology to expand learning opportunities to staff in all locations.
In closing, Strategy 2030 sets the course for ADB to respond to the region’s changing needs. We will need to pool our efforts as One ADB, and work with our developing member countries and other development partners.
Successful implementation of Strategy 2030 will depend critically on you. I look forward to your continued commitment, efforts, and new ideas.