IMF Executive Board initiates Selection Process for the next Managing Director

“The Executive Board of IMF, the International Monetary Fund announced on July 26, 2019 that it has adopted an open, merit-based, and transparent process for the selection of the next Managing Director, similar to the one used in recent rounds. It underscored the importance it places on the successful candidate having the requisite global standing to lead the Fund, which stands at the centre of the global financial system.

“Individuals may be nominated by a Fund Governor or Executive Director and as with past practice, we aim to reach a decision by consensus.

“The Board intends to complete the process by October 4, 2019.”

The Board approved the decision as outlined below:

1. The successful candidate for the position of Managing Director will have a distinguished record in economic policymaking at senior levels. He or she will have an outstanding professional background, will have demonstrated the managerial and diplomatic skills needed to lead a global institution, and will be a national of any of the Fund’s members. As chief of the Fund’s staff and as Chair of the Executive Board, (s)he will be capable of providing strategic vision for the work of a high quality, diverse, and dedicated staff; and will be firmly committed to advancing the goals of the Fund by building consensus on key policy and institutional issues, including through close collaboration with the Executive Board, under whose direction (s)he will fulfil his or her responsibilities. (S)he will have a proven understanding of the Fund and the policy challenges facing the Fund’s diverse global membership. (S)he will have a firm commitment to, and an appreciation of, multilateral cooperation and will have a demonstrated capacity to be objective and impartial. (S)he will also be an effective communicator.

2. An individual may be nominated for the position of Managing Director by a Fund Governor or an Executive Director during a nomination period which shall commence on July 29, 2019 at 12:01 a.m., Washington, D.C. time and will close on September 6, 2019 at 11:59 p.m., Washington, D.C. time. All nominations shall be communicated to the Fund Secretary, who shall obtain confirmation from each nominee of his or her willingness to be considered as a candidate. The Fund Secretary shall hold the names of the nominees in confidence until the end of the nomination period.

3. At the end of the nomination period, the Secretary shall disclose to the Executive Board the names of those nominees who have confirmed their desire to be candidates. If the number of candidates exceeds three, the Executive Board will keep the names of these nominees in confidence until it has drawn up a shortlist of three candidates, taking into account the above candidate profile without geographical preferences. The shortlisting process will be implemented through indications of which candidates receive the most support among Directors, taking into account the Fund’s weighted voting system, with the objective of completing the shortlisting process within seven days following the disclosure to the Board of the candidates. Although the Executive Board may adopt a shortlist by a majority of the votes cast, the objective of the Executive Board is to adopt a shortlist by consensus. The shortlist shall be published by the Fund.

4. The Executive Board will meet with the shortlisted candidates (or all of the candidates if there were fewer than four) in Washington, D.C. Thereafter, the Executive Board will meet to discuss the strengths of the candidates and make a selection. Although the Executive Board may select a Managing Director by a majority of the votes cast, the objective of the Executive Board is to select the Managing Director by consensus with the objective of completing the selection process by October 4, 2019.

Selection Process for IMF Managing Director

The IMF’s Managing Director is both Chairperson of the Executive Board and Head of IMF staff. He or she is appointed by the Executive Board for a renewable term of five years. The Executive Board may select a Managing Director by a majority of votes cast. In the past, the Board has made such appointments by consensus.

Duties of the Managing Director

According to the IMF’s Articles of Agreement, the Managing Director “shall be chief of the operating staff of the Fund and shall conduct, under the direction of the Executive Board, the ordinary business of the Fund. Subject to the general control of the Executive Board, he shall be responsible for the organization, appointment, and dismissal of the staff of the Fund.”

The Managing Director is assisted by a First Deputy Managing Director and three Deputy Managing Directors. He or she appoints the Deputy Managing Directors.

Selection process

The IMF’s 24-member Executive Board is responsible for selecting the Managing Director. Past practice has been that Executive Directors may submit a nomination for the position. Since the 2011 selection round, IMF Governors could also submit nominations.

In the 2011 selection, the Executive Board adopted a strengthened process that supported the selection of the next Managing Director through an open, merit-based, and transparent manner. The Executive Board adopted the same procedure to govern the 2016 selection.

The procedure comprises the following aspects:

Candidate Profile

The successful candidate for the position of Managing Director will have a distinguished record in economic policymaking at senior levels. (S)he will have an outstanding professional background, will have demonstrated the managerial and diplomatic skills needed to lead a global institution, and will be a national of any of the IMF’s member countries.

As chief of the IMF’s staff and as Chair of the Executive Board, (s)he will be capable of providing strategic vision for the work of a high quality, diverse, and dedicated staff; and will be firmly committed to advancing the goals of the IMF by building consensus on key policy and institutional issues, including through close collaboration with the Executive Board, under whose direction (s)he will fulfil his or her responsibilities.

(S)he will have a proven understanding of the IMF and the policy challenges facing the Fund’s diverse global membership. (S)he will have a firm commitment to, and an appreciation of, multilateral cooperation and will have a demonstrated capacity to be objective and impartial. (S)he will also be an effective communicator

Drawing up a shortlist

At the end of the nomination period, the IMF’s Secretary announces to the Executive Board the names of those nominees who have confirmed their desire to be candidates. From these, the Executive Board draws up a shortlist of three candidates, taking into account the above candidate profile without geographical preferences. The shortlist is published by the IMF.

Selecting the successful candidate

The Executive Board meets with the shortlisted candidates at the IMF’s headquarters in Washington, D.C.

Thereafter, the Executive Board meets to discuss the strengths of the candidates and to make a selection. Although the Executive Board may select a Managing Director by a majority of the votes cast, the objective of the Executive Board is to select the Managing Director by consensus, as has been the case in previous selection rounds.

Christine Lagarde (caption IMF)

The IMF has had eleven Managing Directors since it began operations in 1947. Christine Lagarde became the IMF’s eleventh Managing Director on July 5, 2011. Ms. Lagarde was appointed for a five-year term following a six week-long selection process that started on May 20, 2011. On February 19, 2016, following a selection process that commenced on January 21, 2016, Ms. Lagarde was selected to serve a second five-year term starting on July 5, 2016.

David Lipton
(Caption by IMF)

Ms. Lagarde announced her resignation on July 16, 2019 which will be effective September 12. During this period, First Deputy Managing Director David Lipton will be Acting Managing Director of the IMF.

Ms. Lagarde announced her resignation because she was named candidate to become the successor of Mario Draghi, Head of the European Central Bank.

Mario Draghi, President of the European Central Bank ( ECB ) during Monetary Dialogue with Committee on Economic and Monetary Affairs at European Parliament in Brussels. (caption ECB)

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