OFFICIAL USE ONLY R2005-0226

IFC/R2005-025 1 MIGA/R2005-0056

October 27,2005

Closing Date: Monday, November 7,2005

FROM: Vice President and Corporate Secretary

DGO Mandate and Terms of Reference for OED, OEG and OEU Proposed Name Changes

1. for OED, OEG and OEU Proposed Name Changes”, together with a memorandum from the Chairman o f the Committee on Development Effectiveness.

Attached i s a President’s memorandum entitled “DGO Mandate and Terms o f Reference

2. by close o f business on November 7,2005), the recommendation in the President’s memorandum will be deemed approved, to be so recorded in the minutes o f a subsequent meeting o f the Executive Directors.

In the absence o f objection (to be notified to the Vice President and Corporate Secretary

Distribution:

Executive Directors and Alternates President Bank Group Senior Management Vice Presidents, Bank, IFC and MIGA

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its content!

may not otherwise be disclosed without World Bank Group authorization.

The World Bank Washington, D.C. 20433

U S A .

OFFICE OF THE PRESIDENT

October 24,2005

MEMORANDUM TO THE EXECUTIVE DIRECTORS

DGO Mandate and Terms ofReference for OED, OEG and OEU Proposed Name Changes

Attached i s a memorandum from Mr. Vasudev, Chairman o f the Committee on Development Effectiveness, on behalf o f the Committee, proposing amendment to the mandate o f the Director-General, Operations Evaluation (DGO) and te rms o f reference, and name changes for the Operations Evaluation Department (OED), Operations Evaluation Group (OEG) and Operations Evaluation Unit (OEU).

The proposal outlined by the Committee has been reached after close consultation with the DGO and senior management o f the Bank, IFC and MIGA. I recommend that the Executive Directors approve the proposed name changes.

Paul Wolfowitz (J President

THE WORLD BANK/IFC/M.I.G.A

OFFICE MEMORANDUM DATE: October 11,2005

TO: Mr. Paul Wolfowitz, President

FROM: Chander Vasudev, Chairman, CODE

EXTENSION: 8 1046

SUBJECT: DGO Mandate and Terms o f Reference for OED, OEG and OEU Proposed Name Changes

Attached please find the amended mandate o f the Director-General, Operations Evaluation and terms o f reference and name changes for the Operations Evaluation Department (OED), Operations Evaluation Group (OEG) and Operations Evaluation Unit (OEU).

Background

The current Mandate for the Director-General, Operations Evaluation (DGO) and Terms o f Reference for the three independent evaluation units (OED, OEG, and OEU) were approved by the Board on June 13, 2005 (R2005-0140; IFC/R2005-0149; MIGNR2005 -003 0).

In the revised DGO mandate, i t was mentioned that a proposal would be submitted “to address the question o f having a standard, convenient common designation for the three independent evaluation entities (OED, OEG, and OEU) that report to the DGO”. Accordingly, I have reviewed in some detail this question with the new DGO, Mr. Thomas, who in turn has consulted widely with OED, OEG, and OEU managers and staff, as well as with senior managements o f the Bank, IFC, and MIGA, including with the President’s office. The DGO’s office has also discussed with many CODE members, and there was also a general endorsement o f this approach.

In the consultations, it was recognized that the new DGO mandate and TORS for the three evaluation units established a stronger degree o f independence for OEG and OEU along the l ines o f OED. There i s thus now a more equal mandate across the World Bank Group (WBG) to carry out independent evaluation, and to do so in a more integrated way. I t was also noted that interest has been expressed by CODE members for more collaborative evaluation activities between the independent evaluation units. This has potentially great benefits at a time when independence will be increasingly crucial and the synergies across the WBG will be more and more essential.

N o w that the three units at last are on quite equal basis regarding independence and terms o f reference, the time i s opportune to reflect this also through a common name across the independent evaluation entities. While different suggestions were put forward, there has been a broad consensus for Independent Evaluation Group (IEG) for the WBG

independent evaluation function as a whole, including all the three independent evaluation units.

The three individual entities would be renamed to reflect this overall name plus their location in the WBG (in the Bank, IFC, and MIGA, respectively). Thus OED would become Independent Evaluation Group (Bank) (IEGB), OEG would become Independent Evaluation Group (IFC) (IEGI), and OEU would become Independent Evaluation Group (MIGA) (IEGM). Finally, in l ine with these changes the DGO would become Director-General, Evaluation (DGE).

Recommendation

The Committee recommends that the DGO mandate and terms o f reference, amended to reflect the proposed name changes, be submitted to the Executive Directors for approval on an absence o f objection basis.

Attachment

INDEPENDENT EVALUATION GROUP

Mandate of the Director-General, Evaluation

The independent evaluation function i s responsible for the assessment o f the relevance, efficacy, and efficiency o f World Bank Group’ operational programs and activities, and their contribution to development effectiveness. Evaluation enhances accountability and informs the formulation o f new directions, policies and procedures, and country and sector strategies for the Bank’s work. The Director-General, Evaluation (DGE) oversees all independent evaluation work, appraises other World Bank Group evaluation systems and methods, including self-evaluation methodologies, and discharges these responsibilities through the Independent Evaluation Group (IEG), which consists o f entities in the Bank (IBRD/IDA), in the International Finance Corporation (IFC), and in the Multilateral Investment Guarantee Agency (MIGA).2 The DGE works closely with development partners among donors and developing countries in order to foster international evaluation harmonization, to develop evaluation capacity in developing countries, and to encourage evaluations o f the international development system.

Tlz e Director- Gen era1

The DGE i s directly responsible to the Executive DirectordBoard o f Directors o f IBRD/IDA, IFC, and MIGA (the Boards) for:

0 Assessing whether the World Bank Group’s programs and activities are producing the expected results, including global, regional, and other programs in which the World Bank Group i s a participant. Incorporating evaluation assessments and findings into recommendations designed to help improve the development effectiveness o f the World Bank Group’s programs and activities, and their responsiveness to member countries’ needs and concerns. Appraising the World Bank Group’s operations self-evaluation and development risk management systems and attesting to their adequacy to the Boards. Reporting periodically to the Boards on actions taken by the World Bank Group in response to evaluation findings, and on the measures being taken to improve the overall operations evaluation system including dissemination and outreach activities. Cooperating with the evaluation heads o f other international financial institutions and development assistance agencies.

0

0

0

0

The term “World Bank Group” in this note includes the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA). * These entities are named Independent Evaluation Group (Bank) (IEGB), Independent Evaluation Group (IFC) (IEGI), and Independent Evaluation Group (MIGA) (IEGM), respectively.

I

2

0 Encouraging and assisting developing member countries to build effective monitoring and evaluation associations, capacities and systems.

The DGE i s responsible for managing the personnel, budgets, and work programs o f IEGB, IEGI and IEGM, under the oversight o f the Committee on Development Effectiveness (CODE) and in consultation with the respective Vice Presidents responsible for Human Resources and budgets for IBRD, IFC, and MIGA. The Boards appoint the DGE for renewable terms o f f ive years with a rank equivalent to that o f Senior Vice President. The selection process and the remuneration o f the DGE are managed under the oversight o f CODE with the advice o f the Bank’s Vice President, Human Resources. The Director-General can only be removed by the Boards and is ineligible for subsequent appointment or reappointment to the staff o f the Wor ld Bank Group.

The Independent Evaluation Group (Bank)

Terms of Reference

The Director, Independent Evaluation Group (Bank) (IEGB) i s responsible for the operations evaluation function for the Bank and assists the Director-General, Evaluation (DGE) in carrying out the DGE’s mandate. He/she i s selected by the DGE in consultation with the President and the Chair o f the Committee on Development Effectiveness (CODE). The Director, IEGB i s responsible for the overall management o f the Department, which performs the following principal functions:

0 Making periodic assessments o f the adequacy and effectiveness o f the Bank’s operations evaluation and development risk management systems in light o f the institutional objectives o f the Bank. Carrying out reviews o f the Bank’s completion reports and other self-evaluations, and undertaking performance assessments on selected completed projects, impact evaluations, and evaluation studies focusing on ongoing or completed operational programs, policies, strategies, processes, and partnerships.

0 Assisting member countries and development partners to develop their own operations evaluation capacities.

0 Disseminating evaluation findings within the Bank and the wider development community .

0

To discharge these ‘functions, IEGB has unrestricted access to the staff and records o f the Bank. Bank managers facilitate visits to project sites and meetings with client, partner and Government representatives. Without compromising IEGB’s independence, IEGB staff endeavors at all times to maintain close and continuing contact with Bank staff so that their views are adequately considered in IEGB reports, and the analyses and findings o f these reports are understood. Wh i le the Department does not issue instructions and i s not involved in implementing operational practices and procedures, i t s work aims to reach specific conclusions and recommendations that follow from the evaluation findings.

IEGB’s functions and staff are organizationally independent from the Bank’s operational and policy departments and decision-making, Accordingly, performance evaluation and salary review for the Director, IEGB are conducted by the DGE, with the oversight o f the CODE Chair. The Director, IEGB, i s responsible for the selection, performance evaluation, salary review and promotion for IEGB staff, with the oversight o f the DGE and in consultation with the Vice President, Human Resources. IEGB’s work programs and budgets are prepared independently from the Bank’s budget, under the oversight o f the DGE, for endorsement by CODE and approval by the Executive Directors. IEGB’s evaluation reports are the responsibility o f the Director, IEGB, under the oversight o f the DGE, and are transmitted to the Executive Directors through the DGE, following Bank management review and opportunity to comment.

4

The Independent Evaluation Group (IFC)

Terms of Reference

The Director, Independent Evaluation Group (IFC) (IEGI) i s responsible for the operations evaluation function for IFC and assists the Director-General, Evaluation (DGE) in carrying out the DGE’s mandate. IEGI’s independent evaluation work encompasses:

0 Evaluating operational programs and activities, including investment and technical assistance and advisory operations, and the strategies, policies and procedures that relate to them with particular attention to the achievement o f agreed objectives for private sector development and the effects o f investment activity. Assessing the quality and usefulness o f IFC’s evaluation processes and products, and participating in the formulation and continuous improvement o f appropriate evaluation policies, practices and instruments. Identifying and disseminating lessons and making recommendations drawn from evaluation findings to contribute to improved operational performance, accountability for results, and corporate transparency.

0

0

The DGE i s responsible for the management o f IEGI’s personnel, budget, and work program under the oversight o f the Board’s Committee on Development Effectiveness (CODE), and in consultation with the Executive Vice President, IFC (EVP). IEGI’s functions and staff are organizationally independent from IFC operational and policy departments and decision-making.

The DGE appoints the Director, IEGI, in consultation with the EVP and the CODE Chair. The Director, IEGI, i s appointed for a renewable te rm o f 5 years, can only be removed by the DGE, i s not removable without just cause, and i s not eligible for employment in IFC on completion o f assignment. The DGE i s responsible for performance evaluation and salary review for the Director, IEGI, with the oversight o f the CODE Chair, The Director, IEGI, i s responsible for the selection, performance evaluation, salary review and promotion o f IEGI staff, under the oversight o f the DGE and in consultation with IFC’s VP, Human Resources. For administrative purposes, the IEGI Director reports to the EVP.

IEGI’s work programs and budgets are prepared independently from IFC’s budget, under the oversight o f the DGE, for endorsement by CODE and approval by the Board. IEGI’s reports are the responsibility o f the Director, IEGI, under the oversight o f the DGE, and are transmitted to IFC’s Board o f Directors through the DGE, following IFC management review and opportunity to comment.

5

IEGI’s access to IFC staff and records i s unrestricted, and IFC managers facilitate visits to project sites and meetings with client, partner and Government representatives. Without compromising IEGI’s independence, IEGI staff endeavors at all times to maintain close and continuing contact with IFC staff so that their views are adequately considered in IEGI reports, and the analyses and findings o f these reports are understood. While IEGI does not issue instructions and i s not involved in implementing operational practices and procedures, i t s work aims to reach specific conclusions and recommendations that follow from the evaluation findings. The Director, IEGI, participates in relevant meetings o f the Portfolio Committee. IEGI maintains close relations with the IEGB in the Bank and IEGM in MIGA. The DGE reports to the Board o f Directors o f IFC about the quality, usefulness and objectivity o f IFC’s evaluation processes and products.

6

Independent Evaluation Group (MIGA)

Terms o f Reference

The Director, Independent Evaluation Group (MIGA) (IEGM), i s responsible for the operations evaluation function for MIGA and assists the Director-General, Evaluation (DGE) in carrying out the DGE’s mandate. IEGM’s independent evaluation work encompasses:

0 Evaluating programs, guarantee projects, advisory and technical services, and the strategies, policies and procedures that relate to them with particular attention to the achievement o f agreed objectives for private sector development and the effects o f guarantee activity. Assessing the quality and usefulness o f MIGA’s evaluation processes and products, and participating in the formulation and continuous improvement o f appropriate evaluation policies, practices and instruments. Identifying and disseminating lessons and making recommendations drawn from evaluation findings to contribute to improved operational performance, accountability for results, and corporate transparency.

The DGE i s responsible for the management o f IEGM’s personnel, budget and work program under the oversight o f the Board’s Committee on Development Effectiveness (CODE), and in consultation with the Executive Vice President, MIGA (EVP). IEGM’s functions and staff are organizationally independent from MIGA’s operational and policy departments and decision-making.

The DGE appoints the Director, IEGM, in consultation with the EVP and the CODE Chair. The Director, IEGM, i s appointed for a renewable term o f 5 years, can only be removed by the DGE, i s not removable without just cause, and i s not eligible for employment in MIGA on completion o f assignment. The DGE i s responsible for performance evaluation and salary review for the Director, IEGM, with the oversight o f the CODE Chair. The Director, IEGM, i s responsible for the selection, performance evaluation, salary review and promotion o f IEGM staff, under the oversight o f the DGE and in consultation with the manager, Human Resources, for MIGA. For administrative purposes, the Director, IEGM reports to the EVP.

IEGM’s work programs and budgets are prepared independently from MIGA’s budget, under the oversight o f the DGE, for endorsement by CODE and approval by the Board. IEGM’s reports are the responsibility o f the Director, IEGM, under the oversight o f the DGE, and are transmitted to the Board o f Directors o f MIGA, through the DGE following MIGA management review and opportunity to comment.

7

IEGM’s access to MIGA staff and records i s unrestricted, and MIGA managers facilitate visits to project sites and meetings with client, partner and Government representatives. The use o f this information by IEGM staff is subject to the same disclosure policies applicable to any staff o f MIGA that has access to confidential information. Without compromising IEGM’s independence, IEGM staff endeavors at a l l times to maintain close and continuing contact with MIGA staff so that their views are adequately considered in IEGM reports, and the analyses and findings o f these reports are understood, Whi le IEGM does not issue instructions and i s not involved in implementing operational practices and procedures, i t s work aims to reach specific conclusions and recommendations that fo l low f rom the evaluation findings. The Director, IEGM participates in relevant meetings o f Senior Management and Project Review, Finance and Guarantees Portfol io Committees. IEGM maintains close relations with IEGB in the Bank and IEGI in IFC. The DGE reports to the Board o f Directors o f MIGA about the quality, usefulness and objectivity o f MIGA’s evaluation processes and products.