An Evaluation of the World Bank's Trust Fund Portfolio

CHAPTER 6FINDINGS AND RECOMMENDATIONSremains adequate to ensure consistency with the Bank’soverall trust fund policy of only accepting trust funds(including FIFs) that promote development and aideffectiveness.6.15 Management, accountability, and risks. All trust fundsreviewed by the evaluation are broadly consistent with the Bank’smandate, but not always well aligned with Bank or client countrypriorities. Its trust fund management framework and policy focusesmore on processes than on the strategic issues surrounding the Bank’scontinuing uptake of responsibility in administering donor trustfunds.6.16 The Bank’s accountabilities for the trust funds it managesare—with some exceptions—weaker than for IBRD/IDA and Bankbudget-financed activities. The accountability gaps arise because theBank and donors have agreed to parallel allocation, approval, andbusiness processes. Despite ongoing efforts at mainstreaming trustfunds in Bank operational processes, many processes are attached tothe source of funds rather than to the development activity beingfinanced. This has generated inefficiency and weak accounting forresults. If Bank-managed trust funds are to be used efficiently and inan accountable way, they need to follow the same policies, processes,and procedures that guide the use of the Bank’s core resources.6.17 There are both potential missed opportunities and risks to theBank and its clients from the Bank continuing to accumulate trustfund resources and responsibilities without a clear strategy and moreeffective oversight and accountability. Clients face potentialdevelopment risks and the Bank faces potential reputational risksfrom the Bank accepting trusteeship of individual trust funds thatprove not to work well, and more generally, from taking onobligations that operate outside of Bank operational policies (as in thecase of the FIFs) or are inconsistent with Bank commitments to aideffectiveness principles as set out in the Paris Declaration. Moreover,the unpredictability of multi-year donor contributions to establishedtrust funds and, therefore, of trust fund financing to recipients posesrisks to sustainability of support and program planning, both forclients and the Bank.Recommendations6.18 This evaluation concludes that because trust funds addresslimitations in bilateral aid and the existing multilateral system andhave enabled the Bank to enhance its role in pursuit of itsdevelopment agenda the Bank should continue to accept them. But83