Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

World Bank kills business climate report after ethics probe cites pressure on rankings

World Bank kills business climate report after ethics probe cites pressure on rankings

World Bank leaders, including then-Chief Executive Kristalina Georgieva, applied "undue pressure" on staff to boost China's ranking in the bank's "Doing Business 2018" report, according to an independent investigation released Thursday.

The report, prepared by law firm WilmerHale at the request of the bank's ethics committee, raises concerns about China's influence at the World Bank, and the judgment of Georgieva - now managing director of the International Monetary Fund - and then-World Bank President Jim Yong Kim.

Georgieva said she disagreed "fundamentally with the findings and interpretations" of the report and had briefed the IMF's executive board.

The World Bank Group canceled the entire "Doing Business" report on business climates, saying internal audits and the WilmerHale investigation had raised "ethical matters, including the conduct of former Board officials, as well as current and/or former Bank staff."

The U.S. Treasury Department, which manages the dominant U.S. shareholdings in the IMF and the World Bank, said it was analyzing what it called the "serious findings."

The WilmerHale report cited "direct and indirect pressure" from senior staff in Kim's office to change the report's methodology to boost China's score, and said it likely occurred at his direction.

It said Georgieva, and a key adviser, Simeon Djankov, had pressured staff to "make specific changes to China's data points" and boost its ranking at a time when the bank was seeking China's support for a big capital increase.

China's ranking in the "Doing Business 2018" report, published in October 2017, rose seven places to 78th after the data methodology changes were made, compared with the initial draft report.

The "Doing Business" report ranks countries based on their regulatory and legal environments, ease of business startups, financing, infrastructure and other business climate measures.

'SERIOUS FINDINGS'


The report comes nearly two years after Georgieva took over as IMF chief, shortly before the biggest global economic crisis in the Fund's 76-year history, prompted by the COVID-19 pandemic.

The U.S. Treasury is analyzing "serious findings" in the WilmerHale report, Treasury spokeswoman Alexandra LaManna told Reuters. "Our primary responsibility is to uphold the integrity of international financial institutions.”

The WilmerHale report also cited pressures related to data used to determine rankings for Saudi Arabia, the United Arab Emirates and Azerbaijan in the "Doing Business 2020" report published in 2019, but found no evidence that any members of the World Bank's Office of the President or executive board were involved in these changes.

Saudi Arabia climbed 30 places to 62nd in the "Doing Business 2020"

"Going forward, we will be working on a new approach to assessing the business and investment climate," the World Bank said.

WilmerHale said it was hired by the lender's International Bank for Reconstruction and Development in January to review the internal circumstances that led to the data irregularities. It said the bank supported the probe, but it was wholly independent.

CAPITAL INCREASE


The report said the push to boost China's ranking came at a time when the bank's management was "consumed with sensitive negotiations" over a major capital increase, and China's disappointment over a lower-than-expected score.

Georgieva told WilmerHale investigators that "multilateralism was at stake, and the Bank was in 'very deep trouble' if the campaign missed its goals," the report said.

The World Bank in 2018 announced a $13 billion-paid in capital increase that boosted China's shareholding stake to 6.01% from 4.68%.

WilmerHale said Georgieva visited the home of a "Doing Business" manager to retrieve a hard copy of the final report that reflected changes that boosted China's ranking, thanking the employee for helping "resolve the problem."

The report said a "toxic culture" and "fear of retaliation" surround the Doing Business report, and said members of that team "felt that they could not challenge an order from the Bank's president or CEO without risking their jobs."

Former World Bank chief economist Paul Romer first voiced concerns about the integrity of the "Doing Business" report in 2018, saying Chile's ranking may have been biased against socialist then-President Michelle Bachelet. Romer left the bank shortly after his comments.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Hungarian Prime Minister Viktor Orbán stated that Hungary will not adopt the euro because the European Union is falling apart.
Mayor in western Germany in intensive care after stabbing
Australian government pays Deloitte nearly half a million dollars for a report built on fabricated quotes, fake citations, and AI-generated nonsense.
BYD’s UK Sales Soar Nearly Nine-Fold, Making Britain Its Biggest Market Outside China
Latvia to Bar Tourist and Occasional Buses to Russia and Belarus Until 2026
Wave of Complaints Against Apple Over iPhone 17 Pro’s Scratch Sensitivity
Munich Airport Reopens After Second Drone Shutdown
Pro Europe and Anti-War Babiš Poised to Return to Power After Czech Parliamentary Vote
Sean ‘Diddy’ Combs Sentenced to Fifty Months in Prison Following Prostitution Conviction
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
The Personality Rights Challenge in India’s AI Era
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Study Finds No Safe Level of Alcohol for Dementia Risk
Trump Says Ukraine Can Fully Restore Borders with NATO Backing
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Germany Weighs Excluding France from Key European Fighter Jet Programme
Cyberattack Disrupts Check-in and Boarding Systems at Major European Airports
Björn Borg Breaks Silence: Memoir Reveals Addiction, Shame and Cancer Battle
When Extremism Hijacks Idealism: How the Baader-Meinhof Gang Emerged and Fell
JWST Data Brings TRAPPIST-1e Closer to Earth-Like Habitability
Trump Orders $100,000 Fee on H-1B Visas and Launches ‘Gold Card’ Immigration Pathway
France’s Looming Budget Crisis and Political Fracture Raise Fears of Becoming Europe’s “Sick Man”
Three Russian MiG-31 Jets Breach Estonian Airspace in ‘Unprecedentedly Brazen’ NATO Incident
European manufacturers against ban on polluting cars: "The industry may collapse"
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
Christian Brueckner Released from German Prison after Serving Unrelated Sentence
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
The conservative right spreads westward: a huge achievement for 'Alternative for Germany' in local elections
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
U.S. and China Agree on Framework to Shift TikTok to American Ownership
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
The New Life of Novak Djokovic
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
×