An Evaluation of the World Bank's Trust Fund Portfolio

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CHAPTER 5THE IMPACT OF TRUST FUNDS ON THE BANKFigure 5.5Trust Funds Finance over a Third of the Bank’s Core Knowledge Products1.81.6US$ billions1.41.21.00.80.60.428%72%31%69%36%64%BETFsBB Actuals0.20.0FY02-04 Total FY05-07 Total FY08-10 TotalSource: World Bank database.Figure 5.6 AAA Accounts for Three-Quarters of BETF Disbursements for CoreKnowledge Products (FY02–10 Total)Internal KnowledgeProducts($0.2b)Knowledge as aPublic Good($0.1b)14%9%77%Analytical andAdvisory Services($1.0b)The growingreliance onBETFs raisesissues about theglobal,inclusive, andindependentnature of theBank’sintellectualcontributions.Source: World Bank database.5.23 While this study was not able to determine whether trust fundsupport has focused on particular topics or whether that funding hassignificantly shaped the overall portfolio of knowledge work, thegrowing reliance on BETFs raises issues about the global, inclusive,and independent nature of the Bank’s intellectual contributions.Indeed, this concern was expressed by some Executive Directorsduring the Board discussion of the knowledge strategy planningdocument of November 2009, in particular in regard to BETF fundingof the Bank’s World Development Reports.74
CHAPTER 5THE IMPACT OF TRUST FUNDS ON THE BANK5.24 Sector managers stress the importance of trust fund resourcesfor their analytical work and many in the Regions note that there arepressures to access trust funds for economic and sector work (ESW) inorder to preserve Bank budget for project appraisal and supervision.According to the vast majority of those interviewed, budgetconstraints are an important—perhaps the most important—reasonwhy staff pursue trust funds. They referred to “the budget squeeze,”the work program “increasing tremendously while the Bank budgethas remained flat,” and the risk that their unit “would be out ofbusiness without trust funds.” Many noted that, while they generallyseek to be strategic in their mobilization and use of trust fundresources, they also often act opportunistically to drawing on trustfund resources where possible. 10 Many managers stated that qualityassurance is better when trust fund resources are used together withBank budget, and that they much prefer to use Bank budget than trustfund resources for reasons of efficiency and accountability.TRUST FUNDS’ IMPACT ON THE BANK’S BUDGET5.25 According to the fiscal 2011 budget document, “externalfunds” (including trust funds and some reimbursables) have becomean important budget component and are expected to grow in thisfiscal year, “but just enough to keep work program funding flat formost units at FY10 levels.” The document further notes that trustfunds are placing “demands on work programs and increasingbudgetary pressures for their implementation and/or coordination.” 115.26 Bank staff can record their time only against a project as awhole, so information is not being gathered about the share of theirtime spent on trust-fund-related aspects of the work. This evaluation’scountry reviews and staff interviews find, however, that while stafflook to trust funds to supplement Bank budget, they perceive at thesame time that it costs more to manage trust-funded activities thantrust funds typically provide for this purpose. The evaluation alsofound in its country studies that trust fund management costs areonly partially recorded and funded. In other words, it costs the Bankmore to manage trust funds than is captured in available data.Board Oversight of the Trust Fund Portfolio5.27 What information goes to the Board? The Board has beenpoorly informed about the Bank’s administration of trust funds,though this has begun to change. Management provides reports onthe trust fund portfolio, though not on a regular basis. This was donemost recently in the form of a 2010 update on the implementation ofthe trust fund management framework. It provides some, though few,individual trust fund reports and updates. Management also posts aBudgetconstraints area main reasonstaff seek trustfunds.It costs theBank more tomanage trustfunds than iscaptured inavailable data.The Board is notinformed wellenough toexercisegovernanceover the Bank’sacceptance ofresponsibilityfor FIFs andother trustfunds.75
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The World Bank GroupWORKING FOR A W
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©2011 The Independent Evaluation G
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CONTENTSAllocation of Trust Fund Re
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CONTENTSFigure 5.3 All Networks, Es
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AcknowledgmentsThis report was prep
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SummaryAs development challenges ex
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SUMMARYchannels? In addition, the B
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SUMMARYinnovative development finan
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SUMMARYdonor funds in line with rec
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Management ResponseIntroductionMana
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MANAGEMENT RESPONSEplay at the leve
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MANAGEMENT RESPONSEattention needs
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MANAGEMENT ACTION RECORDMajor Monit
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Chairperson’s Summary:Informal Me
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1. The Role of Trust Funds in theGl
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CHAPTER 1THE ROLE OF TRUST FUNDS IN
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CHAPTER 2THE WORLD BANK’S TRUST F
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Page 54 and 55: CHAPTER 2THE WORLD BANK’S TRUST F
Page 56 and 57: CHAPTER 3THE RELEVANCE AND EFFECTIV
Page 80 and 81: CHAPTER 4MANAGEMENT AND ACCOUNTABIL
Page 96 and 97: CHAPTER 5THE IMPACT OF TRUST FUNDS
Page 109 and 110: 6. Findings and Recommendations6.1
Page 111 and 112: CHAPTER 6FINDINGS AND RECOMMENDATIO
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Page 115 and 116: the evaluation, namely operational
Page 117 and 118: Appendix A: Methodology NoteCalcula
Page 119 and 120: Appendix B: Trust Fund Use in the E
Page 121 and 122: APPENDIX B: TRUST FUND USE IN THE E
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Page 125 and 126: APPENDIX C: LIST OF INDIVIDUALS CON
Page 131 and 132: APPENDIX D: CORE TRUST FUND PORTFOL
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Page 139 and 140: APPENDIX E: FINANCIAL INTERMEDIARY
Page 141 and 142: APPENDIX E: FINANCIAL INTERMEDIARY
Page 143 and 144: Appendix F: Reliance on Donor Funds
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Page 147 and 148: Appendix G: World Bank Operational
Page 149 and 150: Appendix H: Organizational Aspects
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ENDNOTES3. Over fiscal 2002-10, the
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ENDNOTES31. Cited in a 2008 indepen
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SELECTED BIBLIOGRAPHYKharas, H. 200
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SELECTED BIBLIOGRAPHY____. 2010l.
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An Evaluation of the World Bank's Trust Fund Portfolio

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