Georgieva insists there is ‘no doubt’ about IMF’s credibility

IMF managing director Kristalina Georgieva insisted that the fund remains a credible institution following recent allegations of manipulated data while she formerly headed the World Bank, and vowed that she had the right skills to lead the fund and shore up staff morale following the controversy.

In a press briefing on Wednesday, Georgieva underscored her commitment to the IMF and its institutional integrity, and addressed the extensive deliberations that have taken place among the fund’s executive board about whether she should stay on to lead the multilateral lender.

“The IMF staff is exemplary in the way they carry out their work and there is no doubt in the credibility of the IMF or our data or our research”, Georgieva said. Referring to the World Bank’s headquarters, she added that “the problem — it is on the other side of 19th Street.”

The fund’s 24 executive directors, representing 190 countries, overcame sharp divisions on Monday to retain her as managing director after they held eight meetings to discuss accusations that Georgieva artificially boosted China’s rankings in a 2018 World Bank report.

Yet their decision, which came at the start of the IMF’s and World Bank’s flagship annual meeting this week, have left lingering questions about her ability to lead the institution and boost staff morale that may have been hurt by the controversy.

Recognising that some officials find it difficult to speak out in a large international bureaucracy, Georgieva said her record at the World Bank proved she had the capability to cure discontent among staff.

She said the institution was “in turmoil” when she arrived as its new chief executive in 2017. “Nine months later . . . the staff survey at the World Bank, demonstrated [a] remarkable turnround in morale, [a] significant increase in trust in senior management,” she said. “The staff association called this ‘the Kristalina factor’”. 

Georgieva, who became the fund’s managing director in October 2019, also said she recognised the “broader message” that the investigation had raised. Although the IMF’s board expressed confidence in her leadership, she said: “I always look at every opportunity to draw lessons for myself and for the institutions I lead.”

“In this particular case, the most important lesson is that in large organisations we have to be always mindful that there may be people that are not feeling entirely included and are not seeing the doors through which they can express concerns.”

The allegations against Georgieva are contained in a report commissioned by the World Bank’s board from law firm WilmerHale, which the board published on September 16. Critics say the controversy over Georgieva’s alleged behaviour has damaged the credibility of the fund and its work.

“The IMF board may have full confidence in Kristalina Georgieva and the IMF’s output but I don’t think this is true of the markets or of the wider economics profession,” said Timothy Ash of BlueBay Asset Management.

“The WilmerHale report at least shows that the World Bank understands there is a problem and is trying to do something about it,” Ash added. “IMF management seems to be in denial.”