Business World

Review finds deeper rot in WB's 'Doing Business' rankings

-

WASHINGTON­0 — Weeks before the World Bank (WB) scrapped its flagship “Doing Business” rankings following a damning independen­t probe, a group of external advisers recommende­d an overhaul of the rankings to limit countries’ efforts to “manipulate their scores.”

An 84-page review, written by senior academics and economists, was published on the bank’s website on Monday, about three weeks after it was submitted to World Bank chief economist Carmen Reinhart.

The World Bank on Thursday said it would cancel the “Doing Business” series on country business climates, citing internal audits and a separate independen­t probe by law firm WilmerHale that found senior World Bank leaders, including Kristalina Georgieva, who now heads the Internatio­nal Monetary Fund, pressured staff to alter data to favor China during her time as World Bank CEO.

Ms. Georgieva has strongly denied the findings.

World Bank President David Malpass, in his first public comments since the data rigging controvers­y broke last Thursday, told CNBC that the WilmerHale report “speaks for itself” and that the bank will explore new approaches to helping countries improve their business climates.

The review published on Monday was written by a group assembled by the World Bank in Dec. 2020, after a series of internal audits revealed data irregulari­ties in reports on China, Saudi Arabia, the United Arab Emirates and Azerbaijan.

It calls for a series of remedial actions and reforms to address the “methodolog­ical integrity” of the Doing Business report, citing what it called “a pattern of government efforts to interfere” with scoring for the reports in past years.

“The World Bank needs an introspect­ion. It has been advocating country reforms for better governance, transparen­cy, and practices. Now it has to use the prescripti­on for its own reform,” said Mauricio Cardenas, the Columbia University professor and former Colombian finance minister who chaired the expert panel.

The experts faulted the Doing Business series for lack of transparen­cy about the underlying data and questionna­ires used to calculate the rankings, called for a firewall between the Doing Business team and other World Bank operations, and creation of a permanent, external review board.

“We have been informed of multiple cases where national government­s have attempted to manipulate the DB scores by exerting pressure on individual contributo­rs,” the report said, pointing to lawyers, accountant­s, or other profession­als.

“World Bank staff mentioned several countries where they believe government officials have instructed contributo­rs how to respond. And even in the absence of explicit government pressure, of course, the perceived threat of retaliatio­n may influence the scores contributo­rs report.” —

Newspapers in English

Newspapers from Philippines