Presidents of the World Financial institution, or funding managers typically, are hardly ever renaissance males or girls. James Wolfensohn, who has died on the age of 86, was a glittering exception.
Not solely did he rework the hidebound Washington-based world help organisation, he additionally revived the funds and inventive breadth of two main US live performance venues, Carnegie Corridor in New York and the Kennedy Middle for the Performing Arts in Washington, whereas discovering the time to be taught the cello on the knee of Jacqueline du Pré and performing with the likes of Yo-Yo Ma and Bono.
That he shook up the World Financial institution is past dispute. As solely the third particular person to function president for 2 full phrases — from 1995 to 2005 — and the primary after Robert McNamara, president from 1968 to 1981, he was given the time to take action. His legacy stands on a wholly completely different stage to the bankers and politicians who served as presidents in between the 2 males.
Wolfensohn enthusiastically sought the job. Armed with spectacular endorsements from the monetary and political worlds, he lobbied then-US president Invoice Clinton for it. The truth that, having travelled extensively in growing nations, he was obsessed with world inequities, as was Mr Clinton, tremendously helped his trigger. So, too, did the truth that the Financial institution had been in one thing of a rut since McNamara retired.
Wolfensohn came to the World Bank at a difficult time. Protesters had disrupted its annual assembly in 1994, arguing that the Financial institution must be abolished. The Financial institution was beset by controversy over its lending for giant dams. An inner evaluation had additionally just lately concluded that the outcomes of greater than a 3rd of its initiatives had been “unsatisfactory”.
On the similar time, the Financial institution was scuffling with the transformation of the previous communist nations of central and japanese Europe and the previous Soviet Union. But, maybe most necessary was the disaster of the poorest nations, which had been paying extra again in debt service than they had been receiving in new loans or support.
Wolfensohn tackled these challenges and extra with attribute vitality, remodeling the Financial institution and, as importantly, the world’s view of it.
James David Wolfensohn was in a way, born into finance on December 1 1933 in Sydney. He was named after the banker James de Rothschild, for whom his father had labored in London earlier than emigrating to Australia. However the household struggled financially, which left a long-lasting imprint upon him. Nonetheless he did fence for Australia within the 1956 Olympics.
Three years later he earned an MBA from Harvard Enterprise Faculty, which set him on his means, in spite, he admitted, of being an detached pupil. He had already obtained a legislation diploma from the College of Sydney.
Again in Australia he labored as a lawyer for numerous monetary establishments earlier than transferring to London and New York for J Henry Schroder after which becoming a member of Salomon Brothers. It was from that perch that his fame grew, not least for his position in orchestrating the phrases of the US bailout of Chrysler, the near-bankrupt automobile firm. His co-architect was none aside from Paul Volcker, who in 1979 grew to become chairman of the US Federal Reserve.
He grew to become a naturalised US citizen in 1980, partly, it was stated, as a result of he had already set his eyes on the World Financial institution, which, by custom had all the time been headed by an American. However he must wait 15 years. He stuffed in his time by operating his personal profitable boutique funding agency in New York, with blue-chip purchasers together with Mercedes-Benz and Ralph Lauren.
Amongst Wolfensohn’s most vital initiatives on the financial institution, launched in 1996 with Michel Camdessus, managing director of the IMF, was the Debt Initiative for Closely Indebted Poor Nations. This created a framework for debt aid to the world’s poorest and most closely indebted nations from all collectors, together with multilateral collectors.
A extra controversial choice by Wolfensohn was to assault corruption in nations receiving Financial institution help. In a speech in 1999, he recalled that “once I arrived on the Financial institution I used to be advised, you don’t speak in regards to the C-word as a result of it’s a political problem and the Financial institution is owned by governments and your constitution doesn’t mean you can enter the political area”. Regardless of fierce inner resistance, he prevailed, utilizing his sharp tongue when obligatory. Right now, the Financial institution builds in corruption clauses into all its agreements.
In 1997, Wolfensohn proposed a “strategic compact” between the Financial institution and its shareholders: if they might “make investments $250m in extra assets over a three-year interval”, the Financial institution would “ship a essentially reworked establishment — faster, much less bureaucratic, extra capable of reply constantly to altering consumer calls for and world improvement alternatives, and more practical and environment friendly in reaching its predominant mission — decreasing poverty”.
One aspect on this transformation was decentralisation of the Financial institution’s operations — getting workers out into the sphere moderately than prescribing recommendation from the ivory tower in Washington. He wished extra session with native authorities and civic teams, significantly when Financial institution-financed initiatives had the potential for critical environmental penalties. That, once more, rankled with many staffers.
Given his personal sector expertise, Wolfensohn additionally believed nations needing help shouldn’t be discouraged from utilizing the worldwide monetary markets. Official international support was finite, he argued, and never all the time disbursed with the recipient nation’s greatest pursuits in thoughts. Higher offers may very well be had within the personal sector.
In 1999, he proposed the Complete Improvement Framework, which referred to as for a long-term and holistic imaginative and prescient of improvement, “possession” by every nation of its improvement technique, and measurement by outcomes. It was to be the inspiration for the Financial institution’s efforts to assist obtain the Millennium Improvement Objectives agreed by the members of the UN in September 2000.
His spouse, the previous Elaine Botwinick, whom he met whereas at Harvard, died in August. Their three kids and 7 grandchildren survive him.