The Economist - USA (2022-05-21)

44 Middle East & Africa TheEconomistMay21st 2022

he would “not accept” Mr Michelitsch con­

tinuing in his role. 

The bank’s evaluation policies are clear:

only  the  board  has  the  power  to  fire  the

evaluator.  Yet  soon  after  the  letter  was

written, Mr Michelitsch reported being the

target of harassment by senior executives.

He  also  complained  to  others  that  he  be­

lieved  his  home  was  being  watched  and

that he had received warnings from several

people. This prompted him to flee, accord­

ing  to  documents  seen  by  The Economist.

Two  months  after  he  left,  the  bank  fired

him without the board’s approval, arguing

that  he  had  abandoned  his  post  and  that

his role was therefore deemed terminated

under  general  staff  rules.  A  delegation  of

board  members  went  to  Mr  Adesina  to

complain. But it gave up the fight after Mr

Adesina,  who  was  re­elected  in  August

2020  to  a  second  term,  refused  to  back

down.  The  bank  says  the  evaluator’s  em­

ployment  was  terminated  “in  accordance

with the rules of the Bank, and in consulta­

tion with the Board of Directors”.

Outsiders saw this incident as having a

chilling  effect  on  accountability.  A  letter

signed  by  nine  independent  evaluators  of

multilateral  institutions,  including  those

of the World Bank and imf, said the firing

“cuts  directly  to  a  fundamental  and  long­

standing principle of independent evalua­

tion”.  Mr  Michelitsch,  who  declined  to

comment for this story, has since taken his

case to a tribunal established by the bank,

but  which  operates  independently.  The

afdbfailed to have it dismissed on a proce­

dural technicality and it is still under way. 

Other employees tasked with scrutinis­

ing management have also quit after facing

pressure,  seemingly  for  doing  their  jobs.

The  bank’s  integrity  and  anti­corruption

office  prevents  corruption  and  investi­

gates allegations of it. Yet in one incident a

senior investigator in this office was prob­

ing allegations of graft against senior offi­

cials. As the investigator was preparing to

finalise the case before leaving to take an­

other job, officials in the human­resources

department began intimidating the inves­

tigator  through  aggressive  questioning.

The investigator quit early to avoid an ugly

dispute. It is understood that the investiga­

tions  were  never  finished.  The  afdbsays

details of investigations are known only by

the department responsible, which reports

to  the  board  in  order  to  protect  investiga­

tors and the department from “any form of

interference of the type alleged”. 

A third case involved the bank’s auditor

general  (ag),  who  is  meant  to  check  that

the bank is not wasting money or exposed

to excessive risks. He also keeps an eye out

for corruption. The agis meant to have to­

tal  independence  and  the  board  must  be

consulted  over  his  appointment  and  re­

moval. Yet these safeguards also appear to

have  failed.  In  mid­2020  Chukwuma

Okonkwo, who had been agsince 2015, sur­

prised  the  board  by  saying  he  would  be

leaving within a few weeks at the expiry of

his five­year term. When asked about this

by the board, Mr Adesina said Mr Okonkwo

was  nearing  retirement  age  and  was  sim­

ply  retiring,  according  to  people  familiar

with the discussions. Yet Mr Okonkwo lat­

er told directors that he had been informed

by  the  head  of  human  resources  that  the

president did not intend to renew his con­

tract. In this case the board dug in its heels

and  kept  him  on  for  another  11  months.

When he reached his actual retirement age

Mr Adesina put in place an acting agfor al­

most a year. The bank says that it could not

renew Mr Okonkwo’s five­year contract be­

cause that would have exceeded its manda­

tory retirement age. It says it offered to al­

low  him  to  leave  with  a  package  and  then

respected  his  wish  to  keep  working.  “The

allegation  that  the  President  removed  the

Auditor General is false,” it said. 

Whistle in the wind

The tussle over the agcame at a tumultu­

ous time: Mr Adesina, a former agriculture

minister  in  Nigeria,  was  already  battling

allegations of corruption and embroiled in

a  spat  with  America,  the  bank’s  largest

non­African shareholder. Just months ear­

lier whistleblowers had accused Mr Adesi­

na  of  overpaying  friends  and  allies  in

breach  of  bank  rules  and  of  using  the

bank’s  resources  for  self­promotion  and

private  gain.  He  denied  any  wrongdoing

and said the allegations were an attempt to

smear  him.  Mr  Adesina  was  cleared  by  an

internal  preliminary  examination  by  the

board’s ethics committee, which ruled that

the accusations were unsubstantiated. But

these  findings  were  challenged  by  Steven

Mnuchin,  then  America’s  treasury  secre­

tary,  who  demanded  an  independent  in­

quiry.  An  external  panel  whose  members

included  Mary  Robinson,  a  former  Irish

president,  was  subsequently  asked  to  re­

view  the  internal  probe.  The  panel  ap­

proved its findings, though with an unusu­

alcaveatthatleftsomeboardmembersas­

tonished:itnotedthatan“absenceofevi­

denceisnotevidenceofabsence”andthat

it“doesnotnecessarilyfollow fromthe

dismissalofa complaintthattherearenot

mattersworthyofinvestigation”.Thepan­

elexplicitlysaidthatthiscommentdidnot

applytothecomplaintsagainstMrAdesi­

na.The afdbsays thatMrAdesina’sre­

electionwasa “cleardemonstrationofthe

exceptionallevelofconfidence”inhim.

The ag’s replacement highlights two

widerissues.Thefirstappearstobea gen­

eraldisregardfortheroleoftheag. Forin­

stance,some 400 recommendationsfrom

thebank’sinternalauditorswerestillout­

standinglastyear.Thebanksaysthatit

“consistentlyrespondstoandaddresses”

recommendationsbytheag.

Thesecondisthatmanyofthebank’s

key oversight roles have typically been

filledbypeopleinactingpositions.Atsev­

eralpointsoverthepasttwoyears,abouta

quarterofthebank’sseniormanagement

staffwereinactingrolesortemporarilyin

charge.Amongthem weretheevaluator

general, theheadofanti­corruption, the

chief risk officer (who safeguards the

bank’s creditworthiness), the general

counsel (who gives legal advice to the

boardandmanagement),andthedirector

ofhumanresources(apowerfulfigurein

hiringandfiringwhoserolehasnotbeen

permanently filled for more than two

years).Thiscreatesa riskofundermining

theindependenceofthebank’swatchdogs

becausethoseleadingthemmaybewaryof

challengingseniorexecutiveswhodeter­

minetheircareerprospects.Italsorisks

underminingtheindependenceoftheag,

whoisbarredfromworkingforthebank

afterhisorhertermends.YetMouhamed

Ba,whohadbeenappointedasactingag

last June, returned to his position this

monthasa managerwithintheauditteam.

The banksays thatitappoints“capable

members ofstaff, who are fully empo­

wered”whenpositionsbecomevacant.

Some appointments haveraised eye­

brows.Onememberofstaffwasappointed

Leaning in, leaning out

Value of multilateral development bank

commitments, % change on a year earlier

Source:Centrefor

GlobalDevelopment

*Comparedto2005–07average

annualcommitments

1

AfDB(Africa)

EBRD(Europe)

ADB(Asia)

WorldBank

150100500-50

Global financial crisis (200-9)* Covid-19 (2020)

IADB (Latin America

and the Caribbean)

The widening gap

Value of multilateral development

commitments to Africa, $bn

Source:Centrefor

GlobalDevelopment

*No data available for the

African Development Fund

2

25

20

15

10

5

0

2120191817161514132012

African Development Fund

International Development

Association

*