a. Global Governance in the 21st Century Over the last two decades, the world has suffered from a global governance deficit. This deficit comprises a lack of the following: – Adequate mechanisms to deal with issues of international peace and security – Satisfactory mechanisms to anticipate and counter global economic shocks – Effective instruments to ensure important global public goods, not least in critical areas such as climate change and public health In the early 2000s, it was expected that the international community would embark on a comprehensive effort to overhaul the multilateral system, with renewed rules and institutions to address the challenges posed by evolving geopolitical and economic circumstances. These ambitions included reform of World Bank and IMF governance; creation of a new world environmental institution; and ongoing attempts at United Nations (UN) Security Council reform. Recent history suggests, however, that such a comprehensive overhaul will not take place anytime soon. Almost every effort to significantly transform the mechanisms for international cooperation and coordination has failed. The floundering of the 2005 UN World Summit, the collapse of the World Trade Organization’s (WTO) Doha Round, the disappointing progress on climate change, and the non-fulfilment of early and indispensable G20 commitments all suggest that governments are not ready, or not willing, to close the growing governance gap, at least within the next few years. In other words, no transformative overhaul of international institutions should be expected in the foreseeable future. In no way should the pertinent players give up on existing institutions; rather, the only realistic alternative seems to be incremental reform.1 Scarce political capital should be applied to improving the performance of multilateral institutions, as radical transformations of the existing overall framework cannot be counted on. Based on this notion, this project addresses one aspect where incremental reform seems not only necessary, but feasible: in the leadership of international organizations (IOs).
b. Why Focus on Leadership? Effective leadership in international agencies is crucial: the world relies on these organizations to ease cooperation – whether in ensuring pandemics are constrained, mail is delivered to foreign countries, or citizens can fly safely to other countries. To be effective, agencies need leaders who can identify and deliver on organizational goals without the constraint of undue influence, by individual members or other stakeholders. Yet, some IOs have not even defined the leader’s role, let alone recruited or managed that person on the basis of particular knowledge, competence and experience required to effectively lead the organization. In addition, democratic election processes and strong accountability mechanisms are necessary to ensure that the interests of executive management are aligned with the organization. While good leadership is not enough for successful international cooperation, it is necessary for effective governance. However, leadership performance in organizations is often buried behind arguments about which country should get “the top job”. The presumption is that, once appointed, leaders have their hands tied by member states, and will predominantly serve their patrons’ interests. Indeed, leaders’ performance is seldom rigorously tested or measured. Moreover, little attention has been paid to the institutional features needed to promote effective and accountable governance. This project of the Global Agenda Council on Institutional Governance Systems has taken up the challenge. First, the project has identified ways in which leadership makes a positive difference in the performance of international agencies. Second, the research team has investigated a sample of IOs, drawing out best (and other) practices that either illustrate or indicate a lack of high-performing leadership. The report’s seven sections cover the positive practices emerging in IOs that support good leadership. This introduction sets out the conception of leadership, as well as the study’s rationale, method and strategy
c. c. Constrained Leadership Leaders influence their agencies’ operational and strategic direction. They work with member states to identify priorities and set strategy, and translate this into operational goals, which in turn are monitored and evaluated as progress is made towards them. Leaders direct a bureaucracy and see that it has sufficient staffing, expertise and financing to carry out mandated tasks. They also must consult and work with other stakeholders. While their room for manoeuvring is limited (see Figure), their actions and behaviour are vital to their organizations’ success. Finally, organizations that depend on ad-hoc funding also constrain their leaders.
High performance in a leadership role has a major impact on an organization’s ability to deliver on tasks requested by its member states. An IO with weak operational planning, high staff turnover and vulnerability to special interests is unlikely to perform effectively. Not only do leadership governance and effectiveness need more attention in international organizations; a striking need also exists for more practicefocused comparisons across organizations so they can learn from each other. An important caveat should be emphasized: improving leadership in IOs is just one part of improving their overall performance. Leaders are heavily constrained, relying on financing from the member states that select them. Some IO boards “monitor” their leadership and organizations’ architectures very closely, meeting weekly to discuss and provide regular input to operational business, while others may only convene several times a year. The enormous differences in the broader governance structures of IOs, which greatly influence their operations, are noted in this report.
d. How Are “Effective Leadership Structures” Measured? Through extensive deliberations, the Council and project team have identified seven indicators of effective leadership structures: 1. Selecting and re-electing leadership on merit 2. Managing performance 3. Setting and evaluating ethical standards 4. Developing and retaining talent 5. Setting strategic priorities 6. Engaging with a wide range of stakeholders 7. Evaluating independently and effectively
In addition, the Council and team sought to capture innovations in leadership across the organizational cases. Not all of the important elements could be measured. In fact, it was difficult to find a metric to measure the degree to which leadership structures permit resistance against “capture” by a powerful state, private companies or vested interests; and this despite that many instances exist of undue influences undermining an organization’s performance (an organization’s leadership can play a key role in ensuring this does not happen, or at least that it is brought to the public’s attention). Some of this dimension of leadership is covered in the report’s reflections on ethical standards, setting strategic priorities (e.g. the proportion of core vs earmarked funds) and procedures for electing an administrator, director-general (DG) or managing director (MD). Future research could investigate other measures of organizational independence and impartiality, such as whether heads of organizations should chair council or governing body meetings, and how effectively they can shape decision-making in these meetings to guard against special interests. Studies could also examine if an organization’s leader is able to publish reports, policy positions or advice in the organization’s name, without prior approval of member states.2 Another important element of leadership is the “speed of renewal” and the capacity to adapt to changing external environments. This was very difficult to measure or compare across the 11 different organizations, given the variety of environments and issue areas. In the future, studies could look at the extent to which IO heads can (and do) initiate projects, pilots or discussions to address emerging issues, and the leeway they have to shape these. Finally, the authors believe leaders play an essential role in ensuring their organizations collaborate with others to deliver cooperation and other public goods. Future research, it is hoped, will identify ways to track governance in this area. The report reflects on practices from a pilot group of international organizations. In some cases, good practice seems relatively straightforward. For example, for the selection of an organization’s head: do clear and publicly available terms of reference (TOR) exist for both the position and a high-quality, exhaustive search process? As for ethical leadership, are leaders required to sign and adhere to the organization’s ethical codes, and publicly declare any conflicts of interest and their financial assets? In some cases, good practices may vary enormously – for instance, in how leaders attract and retain a diverse staff. This study benchmarks current practices and does not rank organizations against each other, as significant differences in the structure, size, nature and scope of IOs make ranking problematic. However, some common principles and structures could strengthen leadership possibilities in all organizations.
d. Methods for Assessing Organizations The Council identified seven indicators contributing to effective leadership. The research team then determined questions for assessing IOs on each of the indicators and for using as the basis for studies of leadership practices in 11 organizations (see appendix): African Development Bank (AfDB), Asian Development Bank (ADB), European Bank for Reconstruction and Development (EBRD), InterAmerican Development Bank (IDB), International Monetary Fund (IMF), International Organization for Migration (IOM), United Nations Development Programme (U