Last week, the World Bank Group’s Board of Directors overruled its own independent accountability mechanism - the Compliance Advisor Ombudsman (CAO) - and allowed the International Finance Corporation (IFC), the institution’s private sector arm, to avoid accountability for the microfinance debt crisis it has contributed to in Cambodia.
This case sets a dangerous precedent for the institution as the Board rejected the findings of the CAO's investigation - including the loss of land and livelihoods, hunger, increased suicide risks , and threats of retaliation - and did not require IFC to develop a management action plan. In response, CAO Director General Janine Ferretti has resigned.
We have drafted a statement to the Board that calls out this unprecedented undermining of accountability and calls on the institution to course correct.
All of this is happening while the Board is trying to create a new independent accountability mechanism to cover the whole institution.
We are still wordsmithing some parts of this statement, but please consider endorsing this statement as soon as possible. We aim to issue an initial statement early next week and will update the signatories as more come in.
