AT A GLANCE: The World Bank Group has a new strategy to scale up assistance to improve governance and fight corruption in client countries. The strategy was unanimously endorsed by the Board on March 20, 2007.
The Bank helps strengthen governance and address corruption through projects and programs that: improve transparency in public financial management; strengthen tax and customs administration; enhance civil service performance; support legal and judicial reform; combat corruption; and enable local and central governments to deliver services and regulate the economy more effectively.
In Fiscal Year 2006 (July 2005 – June 2006), almost half of the new lending operations included support for strengthening governance, amounting to a total support of $4.5 billion, or 19.2 percent of the Bank’s new lending for the year.
The Bank is a leader in the development and application of governance diagnostics, such as Doing Business reports, Investment Climate surveys, Public Expenditure and Financial Accountability (PEFA) indicators, World Bank Institute’s (WBI’s) Governance and Anticorruption country diagnostics, and WBI Governance Indicators.
The Department of Institutional Integrity investigates allegations of fraud and corruption in Bank-financed projects – inside and outside the Bank – and refers its findings the Bank’s Sanctions Committee.
Since 2001, the Integrity Department has handled more than 2,400 cases of alleged fraud, corruption, or other wrongdoing, resulting in the public sanctioning of more than 330 companies and individuals
The World Bank’s assistance to improving governance and combating corruption is aimed at helping countries deliver basic services better to the poor and create growth and employment opportunities by encouraging private investment—both means of lifting people out of poverty. The Bank also has a fiduciary responsibility to its stakeholders to ensure that development funds are used for the purpose intended, rather than jeopardized by corruption
World Bank Initiatives at Country Level
Helping countries strengthen governance is an element of the Bank’s Country Assistance Strategies (CASs) in many countries, and in some countries such as Albania, Bangladesh, and Indonesia, forms a central element of the CAS. In regions such as Africa, support for governance reform is also central to the Bank’s strategy, using a mix of lending, grant, analytical and advisory instruments.
Governance and anticorruption are addressed in projects across the Bank’s portfolio, including in public sector reform, infrastructure, health, extractive industries, financial sector, and others. At the country level, the Bank’s approach is to help state institutions become more efficient, accountable, and transparent. For instance:
Support for better and more transparent management of public finances ensure more accountable policymaking and narrows the scope of financial mismanagement or leakages; Support for civil service wage reform and codes of conduct creates enables better delivery of services to citizens and lessens incentives for corruption; Assistance to strengthen local governments enables them to be more responsive and accountable; and Support for legal and judicial reform and parliamentary capacity strengthens checks and balances to executive power and enables better delivery of justice. In FY06, almost half of new lending projects included governance and rule of law components, with 19.2 percent of total new lending, or $4.5 billion, dedicated to supporting this area.
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