July 2002


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Contents

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Diversity Annual Report 2001

Executive Summary

In 2001, diversity operations focused on integrating diversity into human resource management across the Fund. At management's request, HRD (the Human Resources Department) prepared a comprehensive Fundwide diversity action plan to draw various initiatives together and a working group was established in early 2002 to consider diversity benchmarks. The establishment of centralized mid-career economist recruitment panels was a major step forward in ensuring consistency and equal treatment of diverse candidates; 2001 was the first full year of this approach. Diversity data provided for hiring and promotion decision-making were strengthened to better identify diversity gaps. The Senior Review Committee undertook periodic reviews of staff pipelines with the aim of improving diversity. In 2001, most vacancies for department head positions were filled through an open and competitive process, internally and externally, resulting in diversity in the shortlists. The Fund's commitment to transparency was further signaled by management's decision to post the 2001 Annual Diversity Report on the Fund's external Web site.

Much headway was made in 2001 in improving mentoring and training opportunities. A Fundwide mentoring program was developed—to be piloted in 2002—for mid-career newcomers. To supplement existing diversity workshops, diversity aspects were integrated into Fundwide training programs, especially management development. More and better training is being provided to strengthen Fund-style English writing skills. Triggered by the events of September 11, the Fund addressed the issue of religion for the first time in a training-type session.

Important initiatives are underway to improve management skills. Fundwide managerial standards and the Mission Code of Conduct were adopted in 2001 to harmonize management behavior; 18 departments reported having adopted the managerial standards. The Subordinate Assessment of Managers (SAM) was conducted Fundwide as part of the 2001 Annual Performance Appraisal (APR) exercise. The SAM integrates diversity items into the competencies being assessed, thus providing a tool for monitoring diversity management progress. To assess management performance by gender, HRD reviewed SAM results and found no significant difference between female and male managers' scores.

The Compressed Work Schedule (CWS) was established as a Fundwide practice in 2001 to help balance work and private life demands and to reduce stress. Other important steps in 2001 that ease work/private life tensions include the opening of the full-time child care center for Fund staff and the Executive Board's decision to extend domestic partners' benefits.

Diversity numbers fell short of expectations, with the high level of recruitment in 2000 and 2001 largely a missed opportunity to enhance diversity. The overall representation of developing countries is slightly above the regional quota ⁽¹⁾ but is chronically low in the B grades. Developing country nationals accounted for half of Economist Program (EP) recruits in 2001; their share in grades A9 to A15 also exceeded the regional financial quota. In the B grades, however, the developing country EP recruitment share dropped sharply in 2001. The promotion rate of economist staff from developing countries slightly exceeded that of industrial country nationals in the B grade group, but not in grades A9 to A15.

Despite ongoing efforts, regional balance has not improved in the economist career stream, and low shares of African staff in B grades and of Middle Eastern staff overall are a concern Fundwide. Recruitment has not been able to compensate for these long-standing trends.

African staff is heavily concentrated at the lowest grades and remains thin at the B level, whereas the profile of Middle Eastern staff is balanced across grade groups. Overrepresentation of the United States in staff profiles—especially in the specialized career streams ⁽²⁾—is a dominant trend; staff from the Western Hemisphere, other than United States, region is increasingly overrepresented as well. Although the share of European nationals in the economist career stream is in line with the regional quota, the United Kingdom is significantly overrepresented in the B grades. Pipeline indicators are chronically poor for African staff, consistently strong for U.S. staff, and mixed for Middle Eastern staff.

Women comprise 13.9 percent of B-level staff, up from 9 percent in 1996; progress has been modest in grades A9 to A15, with women's current share of 34.3 percent reflecting an increase of only 1.9 percent since 1996. Women's regional representation from African and Middle Eastern countries is very low, whereas women from the United States continue to be overrepresented. Following several years of successful recruitment into the EP program, women's share dropped in 2001, but still exceeded the share of women graduating from top economics doctoral programs. Recruitment of women into grades A12 to A15 also dropped in 2001, and over the past five years, only four women, compared with 29 men, have been recruited externally to B-level economist positions. Women's promotion rates in all career streams and grade groups exceeded those of men.

In department head positions, developing country nationals continue to be significantly underrepresented, while nationals of industrial English-speaking countries hold 42 percent of those positions. ⁽³⁾ As of end-2001, three department heads were women. Staff from English-speaking industrial countries held most Senior Personnel Manager (SPM) positions, and only one out of 20 SPMs was female.

Departments continue to vary in their staff diversity and progress. New vacancies in 2000 and 2001 provided departments with a unique opportunity to improve diversity; however, pressures to fill vacancies with "ready" candidates as quickly as possible—without firm accountability for diversity results—worked against diversity objectives. Departments' diversity-related programs have strengthened in recent years but lost some of their focus and intensity when diversity action plans were integrated into newly adopted departmental human resources plans in 2000. Progress was particularly notable in newcomers' support and staff training and development. Mentoring was provided for newcomers in 15 departments, newcomers' guidebooks were provided in 14 departments, new staff orientation programs were delivered in 13 departments, and training in English writing was provided in nine departments. Staff reports that many supervisors made commendable efforts to address individual needs, and the work environment is improving significantly in some departments. However, a gap still exists between formal human resource policies and Fund cultural norms; that gap needs to be bridged to enable the community as a whole to benefit from new diversity-friendly opportunities.

Since 1996 the Fund has worked methodically to implement its diversity strategy. In 2001, integration was the focus, rather than development of new measures. The newly established infrastructure and HRD's and Business Advisors' partnership roles with departments should help maintain momentum, allowing departments to gradually assume full responsibility for their diversity agendas.

The Fund's human resource practices are very advanced and competitive with most modern employers; they are also complex and technical. The greater the complexity of policies and practices, the harder they are for managers to implement and for staff to understand, trust, and utilize. Such dynamics are detrimental to staff from different work cultures; staff who know the Fund's culture and its codes, or who have networks and mentors, are better able to navigate. In people management as in economic management, piecemeal reform is not effective when structural reform is required. For example, the APR process—intended to assess performance, provide feedback, and serve as a communication and developmental tool—has evolved over time into an opaque, complex exercise serving a variety of purposes, some conflicting. Although the APR process and the Form have been greatly improved, more thorough reform is needed to ensure that the exercise fulfills its core purpose.

The Fund has developed a number of diversity best practices that have been adopted in other international institutions. Regular monitoring of progress in terms of numbers and practices and transparent reporting are the cornerstones of the Fund's diversity strategy. Personnel indicators and reports that incorporate diversity categories reflect the Fund's objective to identify problems. Management's decision to post the Diversity Annual Report on the Fund's external Web site bolstered transparency and openness. Expectations inside and outside the Fund demand sustained momentum; diversity must not only be increased, it must also be managed in a way that improves the Fund's institutional performance, credibility, and attractiveness as an employer.

The extensive efforts outlined in this and previous Diversity Annual Reports would suggest significant improvement in diversity numbers—this, however, has not been the case. Some departments have made commendable progress and are recognized for their proactive approach, but there continues to be a lot of variance. Staff members, including SPMs, are calling on management for more concrete, visible signals that diversity is a priority. Management's engagement would be reflected most powerfully in the setting of firm benchmarks and departmental accountability. The tools for accomplishing these objectives are already at hand: diversity is integrated into management competencies and assessment instruments, and personnel indicators provide a sound basis for monitoring progress. Benchmarks would clarify priorities and provide direction to diversity initiatives, thereby strengthening the link between policy efforts and diversity outcomes. Fund staff at all levels has a strong drive for career advancement; accountability for diversity progress should be a requirement in that process.

1. Agree on Fund-relevant diversity indicators and set benchmarks that take into account both qualitative and quantitative aspects of diversity. Ensure accountability of supervisors at all levels. Monitor results on an annual basis and link them to APRs and career advancement. (management, departments, HRD) ⁽⁴⁾

2. Offer departments diversity management training that focuses on practical aspects of the Fund's work environment, such as stress management, conflict resolution, decision-making, delegating and monitoring work, performance assessment and feedback, and career advancement issues. (HRD)

3. Set core diversity training requirements for promotions to supervisory grades. Training programs should encourage dialogue on race, religion, gender, sexual preference, and minority-majority dynamics to help supervisors become aware of and sensitive to these issues. (HRD)

4. Ensure that all staff members stemming from underrepresented regions and from "foreign" work cultures are actively offered mentoring support, writing training, and coaching for as long as needed, and that individual development plans are prepared and discussed. (departments, HRD)

5. Regularly reassess existing human resource practices, such as the APR, and introduce structural reforms as necessary to ensure that policies and practices effectively fulfill their core purpose for all staff and work with units, including attention to teamwork. (HRD, departments)

I. Introduction

The Fund's mandate requires the institution to serve a diverse group of 183 member countries, which in turn requires a broadly based staff. As of end-2001, the Fund's 2,633 staff members stemmed from 140 different countries. Staff diversity is a fundamental, yet often challenged, element in the Fund's human resources management. Staff and the Executive Board have expressed increasing interest in promoting diversity and equity. The Fund competes with other employers for the best staff candidates. However, diverse, qualified candidate pools are not readily available in all regions of the world. Given the deep roots of inequality in society, fairness and justice are not easy ideals to fulfill. Regardless of the challenges, staff and candidates expect organizational values and management practices to support their interests. Benefits of diversity are two-fold: internally, diversity benefits the Fund's work environment; externally, it improves the institution's output and sends the message that the Fund incorporates diverse perspectives and is a desirable place to work. The Fund is therefore committed to strive for staff diversity at all grades in all career streams and to ensure fair and equal treatment of all staff and candidates.

The concept of diversity in the Fund has evolved gradually from a focus on geographical representation to an approach that encompasses a broad range of staff characteristics, including gender, family status, language, race, religion, and sexual orientation. The Fund implements typically western, widely adopted human resource practices. Within this framework, the Fund is doing its best to integrate fresh, innovative approaches into its policies, procedures, and practices with the ultimate goal of mainstreaming diversity. As a result of persistent effort over several years, the Fund is often used as a source of best diversity practices by other international institutions. Much remains to be done, however, to achieve the full range of the Fund's diversity goals.

In 1995, the Managing Director created a contractual position of Special Advisor on Diversity to address concerns identified in prior studies, to assist management, and to monitor progress. In 2000, the Advisor's contractual position was converted to fixed-term staff for three more years, with the objective of fully integrating diversity into the Fund's human resource management. The Diversity Advisor reports to management and collaborates closely with HRD. While diversity programs are developed and monitored by the Diversity Advisor and HRD, implementation depends on the efforts of departmental supervisors, review committees, and recruitment panels. Sustainable change takes place in day-to-day operations and management practices; in that regard, accountability is crucial.

The Fund's diversity program was formally established in 1996 in the Managing Director's statement on "Measures to Promote Staff Diversity and Address Discrimination." The statement emphasized the importance of:

• human resource and diversity management,
• equal rights and opportunities,
• zero tolerance of discrimination,
• remedial action through reviews and adjustment measures, ⁽⁵⁾
• transparency in personnel policies and practices,
• open communication in departments,
• constructive performance feedback, and
• departmental accountability in promoting staff diversity.

Current diversity programs and actions can be divided into three main categories: (1) those that address specific diversity problems through investigative and, where needed, corrective actions; (2) those that are designed to meet the needs of underrepresented staff; and (3) those that integrate diversity into Fundwide human resource management functions (often called mainstreaming). Staff has questioned the Fund's practices and procedures, and SPMs have helped to implement improvements in an effort to take full advantage of diversity in carrying out Fund operations. Departments have learned that a reputation for sound human resource management is an asset. Still, resistance to changing established patterns persists in some spheres.

Human resource indicators are regularly assessed and monitored to track diversity status and trends, thereby providing a framework for measuring quantitative progress. The personnel data system (PeopleSoft) compiles data on primary citizenship, gender, age, education, and language of the country of citizenship ("native-language"). Variables such as race, ethnic background, and previous and multi-nationalities are not included in the data system's coverage, but are important dimensions nonetheless. In 2001, the Diversity Advisor and an HRD working group reviewed available diversity data and recommended some improvements to qualitative and quantitative indicators. A newly established task force is exploring the feasibility and appropriateness of introducing jointly-agreed benchmarks; the group will submit its report in 2002.

From 1996-1999 each department prepared an annual diversity action plan and follow-up report to management. The Diversity Advisor monitored those reports to assess progress and remaining problems and prepared an annual report for the Fund. In 2000, a major step forward was made in integrating diversity into human resource management when management requested departments to prepare comprehensive human resources plans, including diversity aspects, on an annual basis. The human resources plans are linked to departmental business plans, thereby integrating diversity further into the Fund's operations.

This 2001 Diversity Annual Report is the fifth progress report since the Managing Director's 1996 statement on diversity. Progress is measured by trends over time, both Fundwide and within departments. Previous Annual Reports are available on the Diversity Web site.

The objectives of this report are to:

• outline the Fund's diversity strategy;
• report on the main actions taken in calendar year 2001 and monitor and analyze progress over time;
• identify concerns; and
• recommend further steps.

Internal and External Benefits of Diversity

II. The Fund’s Diversity Strategy

III. Fundwide Accomplishments

The Fund's diversity accomplishments in 2001 fall into three broad categories: first, actions that strengthen human resource planning and management and integrate diversity data, policies, and practices into the mainstream of human resource functions; second, initiatives designed to prevent diversity-related conflicts and ensure equal treatment of staff, with special—but not exclusive—attention to underrepresented staff; and third, measures targeted to address specific problem areas, such as cultural biases, discrimination, or harassment. In line with the Fund's diversity strategy, the emphasis is shifting from diversity-specific actions to diversity-sensitive ones, and on to integration. Having said that, all types of measures must be on hand when problems arise. Monitoring is needed on an ongoing basis to ensure that issues are addressed appropriately and in a timely manner.

The Fund's awareness of diversity dynamics dates back to the efforts of individual department managers in the late 1960s, which led to the establishment of the Economist Program and the Review and Senior Review Committees. The goal of these initiatives was to enhance opportunities for women and candidates and staff from developing countries in selection processes. More recent actions were the 1992 Staff Survey, the 1994 Status of Women in the Fund study, and the 1995 Discrimination in the Fund study, all of which generated recommendations that have been gradually implemented. The following timeline summarizes the major actions taken from 1996-2000.

Diversity Timeline

In 2001, diversity operations focused on integrating (mainstreaming) diversity into human resources management across the Fund. In HRD, this approach was linked to the department's reorganization. Business Advisors—charged with assisting departments in human resources planning and management, including diversity—completed their first full year of operation; experience indicates that more emphasis needs to be placed on diversity in the future. HRD's On-line Analytical Processing software (OLAP), developed in 2000, has empowered departments in their staffing planning and monitoring exercises. Management asked HRD to prepare a comprehensive, concrete action plan to draw together separate diversity initiatives and ensure consistent implementation. Deputy managing directors have begun to assess departments' diversity progress in department heads' APRs. These types of measures allow the focus to evolve from annual reporting to day-to-day management and decision-making.

The Fund's commitment to transparency was signaled by management's decision to post the 2000 Annual Diversity Report on the Fund's external Web site. Unfortunately, the Human Resource Indicators available to all staff on the Fund's intranet—so important in improving transparency and empowering individual staff members and staff groups—have not been updated since 1999. Updating those indicators once or twice a year should be considered.

Human resources data provided for the selection and promotion processes were further strengthened in 2001 with the inclusion of diversity information on individual candidates, candidate pools, and respective staff groups. RSD (the Recruitment and Staffing Division) developed a strong set of instruments to enable better monitoring of recruitment, drawing on data ranging from applicants' personal and professional information to the final departmental hiring decision. The 2001 Staff Recruitment and Retention Experience report was a commendable example of diversity integration. Since 2000, HRD has offered training on diversity-sensitive interviewing skills. The establishment of centralized mid-career economist recruitment panels was a major step forward in ensuring consistency and equal treatment of diverse candidates in all stages of the recruitment process. The total number of mid-career economists hired through this approach (36 in 2001) is still too small to draw conclusions about changes in regional and gender balance.

Mentoring, one of the key recommendations in earlier diversity-related studies, was developed in 2001 for mid-career newcomers with less than five years of Fund service. The program is built on experience gained in the Diversity Advisor's individual mentoring program and in departmental mentoring programs. The Fundwide mentoring program, which will pay special, but not exclusive, attention to underrepresented staff, will be piloted in 2002 for 100 mentees and their mentors. SPMs provided input in the design process, and a broad-based Steering Committee and a HRD working group were established to ensure quality control.

As a result of persistent efforts over the past several years, much headway has been made in integrating diversity into Fund training programs, especially management development. Seminars such as the Fundamentals of Management, Giving and Receiving Feedback, Interviewing Skills, and Individual and Interpersonal Effectiveness serve as excellent diversity training within the general training curriculum.

As in previous years, two Diversity Weeks were organized in 2001, during which a number of workshops for staff members and departments were offered. Topics included Cross-Cultural Awareness, Appreciative Inquiry, Boss-Subordinate Relationships, Bridging Gender in the Workplace, and Exploring Our Personal Cultural Assumptions. Emphasis was placed on the cultural, gender, and racial diversity of workshop consultants. The sessions were well received by participants, but overall attendance was disappointingly low (113 staff members). The high rate of cancellation or no-shows (24 percent) and low participation of economists, male staff, and B-level staff, continue to be of concern. New arrangements, including more focused topics, shorter sessions, and departmental offerings, need to be considered along with the possibility of mandatory diversity training on a selective basis.

The amount and quality of English writing training has improved, providing staff members with a stronger foundation in Fund standards and written communication styles. Consistent with recommendations in discrimination studies, some departments have developed systems to reward competencies in languages other than English. Training is provided in French, Portuguese, Russian, Spanish, and to a lesser extent, Arabic, German, Italian, Japanese, and Ukrainian. A total of 238 staff members took advantage of language training in 2001; these opportunities reflect the Fund's recognition that languages other than English are relevant to the institution's work and level the playing field for non-native English speakers.

In 2001, the Fund addressed the issue of religion for the first time in a training-type session. Triggered by the events of September 11, SDD (the Staff Development Division) and the Diversity Advisor's office organized an expert panel on religion to discuss concerns and tensions that many staff members were experiencing. Fund staff was also invited to attend similar presentations and events at the World Bank. Feedback during these sessions indicated that religion—a central component of many people's lives—influenced dynamics in the workplace, underscoring the need for continued dialogue. Additional sessions were held for Fund staff on stress and security, during which experts provided guidance on dealing with collective tragedies and improving one's own security. Staff members expressed appreciation for the Fund's responsiveness. Many lessons can be drawn from the experience, including the importance of sensitivity to individual needs of staff members and the value of dealing with emotional crises in a timely, upfront manner. Because such skills do not come naturally to every supervisor, incorporating them into management training would be worthwhile.

Fundwide managerial standards and the Mission Code of Conduct were adopted in 2001 and will further harmonize departmental practices and managerial behaviors. The Handbook on Performance Management—completed in 2000—was followed-up with briefings to managers on its content and use. The SAM, initiated in 1999, was conducted Fundwide in 2001 for supervisors and managers ranging in rank from mission chief to department head as part of the APR exercise. SAM integrates diversity items into the competencies being assessed, thus providing a tool for monitoring diversity management progress. To assess SAM results on management competencies by gender, HRD reviewed the mean scores for each competency and found no significant difference between female and male managers' results.

Drawing on studies of gender differences in written performance assessments in the Fund, preparatory briefings on the 2001 APR process again highlighted the need for greater cultural and gender sensitivity and fairness. Guided by recommendations of earlier diversity-related studies in the Fund, the APR form is now competency-based and well structured. However, the instrument and the procedure still seem to be challenging for staff unfamiliar with the Fund's culture and language nuances. Despite improved transparency, some staff members distrust the process, citing concerns that the APR may be more efficient in hiding feedback than revealing it, especially with respect to negative and developmental aspects. The quota approach to awarding "1" ratings and the close link between APR ratings and promotion prospects have distanced the APR process from its primary function as a channel for feedback and individual performance assessment. The system also does not allow team assessment—an important element in the Fund's work. Many organizations have learned that structural reform is needed every few years to reestablish the core purpose of human resources practices and to eliminate unintended dynamics that can develop.

Two on-line stress surveys were carried out in 2001, the results of which indicate that stress levels remain high, especially among senior grade groups and women. In 2002, the Health Services Department will again conduct a study on employee health in the Fund to review progress since 1997.

The CWS was piloted successfully in seven departments and two offices in 2000 and established as a Fundwide practice in 2001. CWS offers staff an important tool to help balance work and private life demands; having more control over one's work schedule has proven to reduce stress levels. The program has been well received by staff across grade groups, although some individuals and work units report that work pressures preclude them from taking full advantage of it. It appears to be widely understood that CWS is not an entitlement. However, pockets of manager resistance persist, reflected in some supervisors' lack of sensitivity to private life needs of their staff—for example, tight deadlines imposed on tasking simply because of poor planning or falling back on perceived Fund norms. Other important steps in 2001 that ease work/private life tensions include the opening of the full-time child care center for Fund staff and the Executive Board's decision to extend to domestic partners benefits that are currently available to spouses, with the exception of the Staff Retirement Plan (SRP) and Spouse and Child Allowances (SCA).

Review committees continued to be aware of diversity dynamics in considering candidates for promotion. Data on individual applicants were supplemented by data on "diversity pipelines" (compiled by the Diversity Advisor), potential candidate pools, forthcoming vacancies, and demographics of staff in respective grade groups. As in previous years, the Senior Review Committee undertook periodic reviews of staff pipelines with the aim of improving diversity. However, given the thinness of internal pipelines for women and underrepresented nationals, external recruitment to senior vacancies is needed if diversity is to be promoted more quickly. Department head positions are now filled on a competitive basis. In most cases vacancies for these positions are advertised internally and externally, with candidates being short-listed on objective criteria. The successful candidates are chosen after the short-listed candidates have been interviewed by both the Managing Director and Deputy Managing Directors.

IV. Departmental Progress

Departments prepared and implemented their first diversity action plans in 1996. In 2000, diversity plans were integrated into the newly established departmental human resources plans. This chapter draws from those plans and from information provided by SPMs for this report.

Departments' diversity-related programs and policies have strengthened in recent years, although some of those programs' intensity and focus was lost when diversity action plans were integrated into departmental human resources plans in 2001. SPMs report that in 2001, progress was made in recruitment, newcomers' support, and staff training and development. Several departments have also implemented initiatives to improve awareness, sensitivity, and tolerance through informal channels and approaches. Many staff members have reported informally that the work environment in departments is changing in positive ways, with supervisors striving to address staff members' needs. However, some work units and individual supervisors fail to meet staff's expectations; fear of potential repercussions often inhibit staff members from raising problems openly.

Research shows that mentoring and designing individual development plans are among the most powerful ways to improve diversity and equality in organizations; many departments have made serious efforts on these fronts. Following the example first set by MED (the Middle East Department) in 1993, 15 departments provided mentoring for their newcomers in 2001; two more departments are expected to do so soon. Those departments with well-planned programs and carefully selected and trained mentors have been successful; structure, clear guidelines, and committed mentors are required elements. Some departments need to reassess their mentoring programs and make a fresh start. Indeed, poor planning and untrained mentors can do more harm than good.

Thirteen departments provided orientation programs for newcomers in 2001 and 14 departments had starters' kits or manuals. PDR (the Policy Development and Review Department) pioneered departmental orientation more than ten years ago, followed by EU2 (the European II Department) in 1994; MAE (the Monetary and Exchange Affairs Department) had designed a starters kit before 1985. These initiatives ensure that all staff members—regardless of their background, cultural preferences, work experience, networks, or personal style—have access to transparent information about Fund standards and procedures at the outset of their service.

English writing programs level the playing field for staff members unfamiliar with the Fund's written communication style. The need for such training was highlighted in studies of discrimination in the Fund and later by consultants investigating individual discrimination cases. OIA (the Office of Internal Audit) offered a departmental writing program as early as 1994. STA (the Statistics Department) developed an excellent assessment and training program in 1996; FAD (the Fiscal Affairs Department) established a training program that same year, and EU1 (the European I Department) followed suit in 1997. In 2001, nine departments offered writing training to their staff. Training in languages other than English is also in high demand in many departments. Drawing from the 1995 Discrimination in the Fund study's recommendation to reward staff for multi-language skills, some departments (EU2, FAD, PDR, and TGS (the Technology and General Services Department)) developed systems to acknowledge these performance competencies when relevant to assignments and reasonable in the context of other priorities. In other training initiatives, five departments offered diversity workshops for their staff in 2001 to supplement Fundwide programs.

Based on principles developed by EU1, management standards were endorsed Fundwide in 2001; 18 departments reported that they had adopted those standards, supplemented at times with department-specific items. Management standards, as well as the Code of Conduct for Mission Travel, serve the Fund's diversity management goals commendably.

Fundwide recruitment in 2000 and 2001 was twice as high as historical levels. While new vacancies provided departments a unique opportunity to improve diversity, pressures to fill vacancies as quickly as possible with "ready" candidates worked against diversity objectives, leading to disappointing results. In early 2001, management asked departments to intensify efforts to hire women and nationals from underrepresented countries. External recruitment for B1 to B4 positions was to be preceded by a systematic search process to ensure that shortlists for those positions included minority candidates. Although firm quantitative targets were not set, progress was to be reviewed in department heads' performance appraisals.

Departments continue to vary in their staff diversity and progress (Figures 1 and 2 in Attachments). Developing countries are better represented in economist departments than in others, with 41.6 percent in area departments and 42.4 percent in functional departments, compared with 31.3 percent in support departments; all of those shares, however, are lower than levels in 2000 (Figures 1, 2a, and 2b; Table 3 in Attachments). Developing country nationals are concentrated in the lowest grade groups in most departments; exceptions are AFR (the African Department), FAD, INS (the IMF Institute), MED, and WHD (the Western Hemisphere Department), all of which have 40 percent or more developing country nationals in their B grades. Departments that fall below the Fund average in developing country representation in grades A9 and above include EU1, EU2, EXR (the External Relations Department), OMD (the Office of the Managing Director), RES (the Research Department), SEC (the Secretary's Department), and TGS. Having said that, EU1, RES, and SEC have improved developing country shares in their B grades in recent years. In 2001, EU2, EXR, and HRD made significant progress in strengthening developing country representation at the B level.

In most departments, the African and Middle Eastern regions are severely underrepresented at senior levels. That trend became more pronounced in 2001, with 15 departments employing no B-level African staff and ten departments employing no B-level Middle Eastern staff. European nationals are overrepresented at the B level in MED, OMD, and TRE (the Treasurer's Department) and U.S. citizens are overrepresented in LEG (the Legal Department), PDR, and TGS ⁽⁷⁾ (Table 4 in Attachments).

The Fund's working language is English and strong English speakers and "thinkers" have an advantage in the institution's work environment and career structure. However, additional factors appear to be at play in language-based trends. Departmental data indicate that staff members from English-speaking industrial countries have an advantage in professional and senior grades. In the functional departments, the share of English-speaking industrial country nationals jumps sharply from 32.4 percent in grades A9 to A15 to 54 percent in the B grades. In support departments, the respective share increases from 55.6 percent in grades A9 to A15 to 58.8 percent in the B grades. Area departments have a more balanced distribution of English speakers across grade groups (Figure 3; Table 6 in Attachments). In contrast to industrial country English-speaker trends, representations of English-speaking developing country nationals do not increase significantly in senior grades.

Women comprise 13.9 percent of B-level staff Fundwide; B-level women's representation is 25 percent in support departments, 14.6 percent in functional departments, and only 8.2 percent in area departments (Figure 4, Table 5 in Attachments). Improvement has been most pronounced in the functional departments, specifically in INS, LEG, RES, and TRE, none of which had any B-level women six years ago (Figure 5b; Table 5 in Attachments). HRD's achievement in 2001 of a staff mix of 60 percent women at the B level was complemented by a significant increase in employment of developing country nationals. Among area departments, APD (the Asia Pacific Department) improved its gender balance in senior grades to 16 percent women. Progress from a gender standpoint in grades A9 to A15 has been disappointing for the institution as a whole, with women's share increasing only 1.9 percent in six years (to 34.4 percent in 2001). Functional departments—specifically INS and LEG—have performed better than others in this category (Figure 5a; Table 5 in Attachments). Among area departments, MED achieved the critical mass level (30 percent) of women in the A9 to A15 grade group in 2001. WHD, in a span of six years, improved its share of women in that grade group from 17 percent to 25 percent.

V. The Diversity Picture in Numbers

Ongoing, transparent monitoring of qualitative and quantitative progress is instrumental in the Fund's diversity strategy. The quantitative indicators analyzed in this chapter cover nationality (grouped by region and into developing/industrial countries) and gender from the standpoint of staff count, recruitment, ⁽⁸⁾ mobility, promotions, time-in-grade, and pipeline profiles. This chapter focuses on CY 2001 but also draws on data from 1991 through 2001 to assess trends.

The Fund does not set targets or quotas for diversity; benchmarks are needed, however, to serve as guidelines and comparators. Member countries' Fund quota shares serve as the benchmark to assess nationality and regional representation, providing a general, although not perfect yardstick.⁽⁹⁾ For example, the African region's relatively low quota share of 4.2 percent does not fully reflect the resource intensiveness of this region in the Fund's operations. The reader must therefore use judgment in interpreting the data presented below. Regional groupings in Fund diversity reports follow the country groupings of the organization's area departments, and do not exactly correspond to the various groupings used in other international institutions, including the World Bank. ⁽¹⁰⁾ Gender recruitment and representation are evaluated against the share of graduating female macroeconomists in major universities and comparable data in other international institutions. The Fund also employs the concept of "critical mass," 30-35 percent, as a benchmark for women's share. ⁽¹¹⁾ Due to accuracy and privacy concerns, the Fund does not collect data on some important diversity aspects, such as race, ethnic background, or religion. A working group established in early 2002 is evaluating the need for and appropriateness of broadening diversity benchmarks.

Nationality Representation

The overall representation of developing countries is slightly above the regional quota of 38.5 percent. In economist career stream grades A9 to A15, the developing country share has gradually improved since 1997 and now exceeds the regional quota; the share has also improved at the B level over time, but dropped in 2001 from 33.2 percent to 32.1 percent. In the specialized career streams, developing country nationals are underrepresented in grades A9 to A15 (36 percent) and significantly so in the B grades (18.5 percent) (Figures 6 and 7; Tables 7 and 8 in Attachments).

Despite ongoing efforts, regional balance has not improved in the economist career stream, and low shares of African staff in B grades and of Middle Eastern—especially Arab—staff overall continue to be of concern Fundwide. The number of African staff has increased steadily in recent years, totaling 174 (or 6.6 percent of all staff) in 2001. Fundwide, the distribution of African staff is heavily concentrated at the lowest grades and is chronically thin at the B level, where that region currently accounts for only 3.4 percent all staff. In grades A15 to B5 the Fund employs 25 African nationals, 4.7 percent of the total; at the World Bank, African and Caribbean nationals account for 7.1 percent of staff of comparable seniority (grades GH+). In economist career stream grades A9 to A15, Africans account for 6.6 percent of staff; at the B level, the share is only 3.8 percent (down from 4.4 percent in 2000). A total of 119 staff members stem from the Middle East, down from 125 in 2000. Compared with the regional quota of 8.5 percent, Middle Eastern staff in grades A9 to B5 account for only 5.5 percent of economists (down from 5.9 percent in 2000) and 3.7 percent of specialized career stream staff (down from 4.3 percent in 2000) (Figure 8; Table 7 in Attachments). Unlike the African staff profile, the distribution of Middle Eastern staff is balanced across grade groups.

Overrepresentation patterns reported in previous Diversity Annual Reports continued in 2001. The overrepresentation of the United States in staff profiles—especially in the specialized career streams—is most striking. The Western Hemisphere, other than the United States, is increasingly overrepresented as well. While the share of European nationals in the economist career stream is in line with the regional quota, within that region the United Kingdom is significantly overrepresented in the B grades in both the economist and specialized career streams (Figure 8; Table 7 in Attachments). Nationality distribution within all regions is uneven. The most under- and overrepresented nationalities are presented below.

Gender Representation

Fundwide, women comprise 13.9 percent of B-level staff, 34.3 percent of A9 to A15 staff, and 84.1 percent of support staff. Progress in improving the gender balance in grades A9 to A15 has been modest, with the share of women increasing by only 1.9 percent since 1996, including a slight drop in 2001. On a brighter note, women's share improved in the B grades in 2001 after a pause in progress the previous year. Women's low representation continues to be a concern in the economist career stream, where women comprise only 22.5 percent in grades A9 to A15 and 10.8 percent of B-level positions. In the specialized career streams, women account for 54.1 percent of staff in grades A9 to A15 and 27.7 percent of B-level staff, the latter marking an impressive improvement from 21.1 percent in 2000 (Figures 9 and 10; Tables 7 and 9 in Attachments). The still large gap between women's representation in the specialized career streams' B level and grades A9 to A15 is mostly attributable to the Fund's tradition of appointing economists, rather than career stream experts, to senior grades. At the World Bank, women account for 22.2 percent of GH+ staff, compared with 13.4 percent at the corresponding grades A15 to B5 at the Fund.

Since the 1994 Status of Women in the Fund Study, the Fund has appointed the first four women to the position of department head, one of whom later accepted a position outside the Fund. Pipelines in the core functions are slowly improving but continue to have significant gaps; critical mass is, therefore, still far from being achieved in senior grades (Figure 11).

Women's regional representations are very low from African and Middle Eastern countries, and only one woman from each of those regions has attained B-level status. Women from the United States continue to be overrepresented, comprising 29 percent of B-level women economists and 33.3 percent of B-level women in the specialized career streams (down from 46.6 percent in 2000). In grades A9 to A15, women from the United States are even more overrepresented. European women are significantly underrepresented in the specialized career streams, despite the large supply of qualified European professionals in the market (Table 10 in Attachments). Attention needs to be paid simultaneously to gender and geographical origin to make balanced progress in line with the Fund's inclusive diversity strategy.

Recruitment

In 2000 and 2001, the Fund hired record high numbers of new staff, but missed the opportunity to improve diversity. In 2001, new hires included 160 professionals, 36 EP recruits, and 14 senior staff.

Developing country nationals continued to account for roughly 50 percent of EP recruits in 2001, and their share in recruitment to grades A9 to A15 was also above the regional financial quota share. In the B grades, however, the share of developing country nationals hired was only 21.4 percent (down sharply from 43 percent in 2000), far below the current staff share (29.5 percent) and even further from the combined country quota (38.5 percent) (Figure 12; Table 12 in Attachments).

From a regional perspective, recruitment has not been able to compensate for the underrepresentation of the Middle Eastern region in all grade groups and the African region in B grades. Over the past five years, recruitment of Middle Eastern staff has remained low—less than 4 percent in the economist grade groups A9 to A15 and B1 to B5. ⁽¹²⁾ Recruitment from the African region has been more successful in grades A9 to A15 but very disappointing in the B grades. In 2001, only one African and one Middle Eastern candidate were hired to the EP program. Asian staff recruitment has been generally strong; recruitment of Western Hemisphere, other than U.S., nationals greatly exceeded the regional quota; and the recruitment of U.S. citizens further increased the United States' overrepresentation in the B grades and in the specialized career streams' grades A9 to A15 (Table 11 in Attachments).

After several years of successful recruitment of women into the EP program, in 2001 women's share dropped to 30.6 percent, below the level of 1998. However, the 2001 share still exceeds the benchmark of women's share of graduating PhDs in the top economics programs (25-30 percent). Recruitment of women into grades A12 to A15 dropped for the second year in a row to 18.1 percent (17 out of 94 hires) and two out of a total of 13 hires to the B level were female (15.4 percent). Over the past five years, only four women, compared with 29 men, have been recruited externally to B-level economist positions. During that same period, in the specialized career streams 42.5 percent of grade A9 to A15 and 28.6 percent of B-level hires have been women (Figure 13; Table 13 in Attachments). It is hoped that accurate, detailed data will become available in the future to assess annual recruitment trends against vacancies in departments, which would provide a clearer picture of how departments have used their opportunities to increase diversity.

Mobility

Mobility is required for professional development and promotion in the Fund's career system, but some question whether mobility opportunities are equally available to all staff. From the gender standpoint, women's mobility in grades A9 to A15 has indeed been consistently lower than men's over the past five years. In the B grades, women's mobility was significantly lower than that of men in 2001. From a developing/industrial country perspective the mobility of nationals from developing countries was somewhat lower than their industrial country colleagues' in 2001, but findings do not indicate systemic patterns (Figures 14 and 15; Tables 14 and 15 in Attachments).

Promotions

Promotion rates represent the share of promoted staff out of total staff in each category and grade group. ⁽¹³⁾ In 2001, the promotion rate of economist staff from developing countries slightly exceeded that of industrial country nationals in the B grade group, but not in grades A9 to A15; in the specialized career streams, developing country staff members were promoted at higher rates than their industrial country colleagues in all grade groups (Figures 16 and 17; Table 16 in Attachments). The promotion rate of African staff in economist grades A13 to A15 was higher than the Fund average, while in other grade groups their promotion rate was lower than average. For Middle Eastern staff, the promotion rate in economist B grades continued to be significantly low—5.6 percent compared with the Fund average of 21.4 percent—and was also below the Fund average in other economist grade groups. It is important to note that the small number of staff from these two regions weakens the relevance and accuracy of this type of analysis. With regard to gender, women's promotion rates in all career streams and grade groups exceeded those of men, as had largely been the case in 2000. Women economists at the B level achieved a promotion rate of 35.5 percent, compared with 19.7 percent for men in the same category.

Pipeline Dynamics

Pipeline indicators reflect recent pipeline development as well as long-term hiring patterns and stocks of internal candidates. The impact of these dynamics cannot be isolated, requiring that trends be monitored over time and across several variables to reach conclusions. The following three indicators are explored: a) ratio of staff at Grade A15 to staff at Grade A14; ⁽¹⁴⁾ b) percent of staff in grades A15 to B5 relative to all staff in grades A9 to B5; and c) time in grades A14 and A15 for economists and in grades A12, A13, and A14 for specialized staff.

In the economist career stream, both the A15/A14 ratio and the combined share in grades A15 to B5 are less favorable for developing country nationals than for industrial country nationals. Indeed, the distribution of developing country staff is concentrated in the lowest professional grades across the board. However, the average time in Grade A14 is now shorter for developing country economists than for industrial country economists and their average time in Grade 15 is equal to their industrial country counterparts, which may indicate improving pipeline profiles. Figures 18 and 19 (Table 20 in Attachments) illustrate developing and industrial country staff comparisons grade by grade, and indicate that the dividing grade in the economist career stream is A15. In the specialized career streams, uneven concentrations of developing and industrial country staff are even more prominent than in the economist career stream. Fundwide, the share of developing country nationals drops from 44.9 percent in Grade A11 to 20 percent in Grade B5.

From a regional standpoint, pipeline indicators are chronically poor for African staff, consistently strong for U.S. staff, and mixed for Middle Eastern staff. Developments in 2001 indicate slight improvement in Grade A15 for underrepresented staff groups, with shares of African, Asian, and Middle Eastern economists increasing. The share of African economists in grades A15 to B5 relative to all African economists employed by the Fund dropped to 30.1 percent, while the share of U.S. economists—the highest regional share—increased further to 51.3 percent (Table 1 on Summary of Pipeline Indicators); Middle Eastern economists are concentrated in grades A15 to B5 (43.3 percent). The A15/A14 ratio did not improve for African and Middle Eastern economists, whereas that ratio strengthened further for U.S. economists. The average time in Grade A14 had previously been longest for African economists; in 2001 that trend improved significantly, with a reduction from over six years to just over four years spent in Grade A14. For the Middle Eastern region, the time-in-grade indicator weakened, giving that region—together with Africa—the distinction of having the longest average time in Grade A14. In the specialized career streams the unevenness between regions from the standpoint of time-in-grade is even more pronounced.

The pyramids in Figure 20 highlight the restricted pipelines of African and Middle Eastern staff in each grade.

Gender comparisons in the economist career stream show that women are still far more concentrated at the lowest grades. Successful EP recruitment over the past several years and very low recruitment to the B grades have kept the profile stable regardless of women's increased share overall and improved promotion rates. The A15/A14 ratio is lower for women (.30) compared with men (.53). The share of women in grades A15 to B5 is still less than half that of men in both the economist and specialized career streams (Table 1 above). And in a shift from time-in-grade trends in 2000, women now spend a longer time on average in Grade A14 in the economist career stream and in Grade A13 in the specialized career streams relative to men (Figures 21 and 22; Table 21 in Attachments).

The Fund's Management Profile

As outlined in Table 2 below, developing country nationals continue to be significantly underrepresented in department head positions, comprising just over 21 percent of the total (compared with 26.7 percent in 1990); nationals of industrial English-speaking countries hold 42.1 percent of those positions. As of end-2001, three department heads (16 percent) were women. Most SPM positions (55 percent) are held by staff from English-speaking industrial countries; developing country nationals account for only 25 percent of the total. Only one out of 20 SPMs was female as of end-2001. Administrative Officer (AO) positions have been filled exclusively by women, about 50 percent from developing countries. The new positions of Assistant to the Senior Personnel Manager (ASPM) and Office Manager (OM) have yet to be filled and will be discussed in the next Diversity Annual Report. HRD has significantly improved the share of women in its B grades and built on its diversity progress in 2001 by filling 20 percent of its B-level positions with staff from developing countries. Having said that, senior levels in HRD remain heavily concentrated with English-speaking industrial country staff.

¹ Each member country of the Fund is assigned a quota, which is calculated on the basis of uniform formulas designed to reflect the relative size of its economy. The country's quota determines its subscription to the Fund, its voting power, its maximum potential access to Fund financial resources, and its share in SDR allocations. Future references to "quotas" are intended to refer to a country's or region's share in total Fund quotas.
² Specialized career streams include the following groups: accounting, administrative, auditing, budgeting, computer systems, documents and records, facilities, general administrative, graphics services, human resources, investment management, language services, legal, library, public affairs and information, procurement, and writing and editing.
³ English-speaking industrial countries include Australia, Canada, Ireland, New Zealand, the United Kingdom, and the United States. On average, nationals from these countries comprise 35.9 percent of A9 to A15 staff and 46.6 percent of B-level staff. Nationals from other English-speaking countries comprise 12.5 and 11.9 percent respectively (Table 6 in Attachments).
⁴ Responsible parties are listed in parentheses.
⁵ Includes individual discrimination case reviews.
⁶ Staffing guidelines are outlined under the so-called N-rules in the IMF's By-Laws, Rules and Regulations. Specifically, the N-rules state that "In appointing the staff the Managing Director shall, subject to the paramount importance of securing the highest standards of efficiency and of technical competency, pay due regard to the importance of recruiting personnel on as wide a geographical basis as possible (N-1, adopted as N-2 September 25, 1946, amended June 22, 1979). Subject to rule N-1 above, the employment, classification, promotion, and assignment of persons on the staff of the Fund shall be made without discriminating against any person because of sex, race, creed, or nationality (adopted as N-1 September 25, 1946, amended June 22, 1979)" (International Monetary Fund, By-Laws, Rules and Regulations, Fifty-Eighth Issue, May 2001).
⁷ ICM (the International Capital Markets Department) is not yet fully staffed and will be discussed in the next annual report.
⁸ It should be noted that staff in grades A1 to A8 are hired locally; diversity guidelines have therefore not been set for this category.
⁹ Over/underrepresentation is determined by subtracting a member country's percentage share of the Fund staff from its percentage share of the financial quota. If the staff percentage is larger (i.e., if the difference is positive), the country is overrepresented; if it is smaller, the country is underrepresented. In some cases, the country share is too small to reveal the underrepresentation even if the staff number were zero. A staff member's nationality is defined by the primary citizenship she or he reported when joining the Fund. At this point, multi- or previous nationalities are not included in the database.
¹⁰ The World Bank combines African and Caribbean countries as a proxy to monitor the share of black staff. The World Bank has not set monitoring guidelines for Middle Eastern staff.
¹¹ Rosabeth Moss Kanter, a prominent author and scholar, introduced the concept of critical mass in 1977 to reflect the share of minority members needed to influence decision-making and act as an autonomous group in an organization.
¹² Recruitment from a regional perspective is reviewed over the past five years, as annual recruitment numbers by region are too low for meaningful analysis.
¹³ Starting in the 2000 Diversity Annual Report, the formula to calculate promotion rates was slightly modified to attain more precise indicators. Therefore, the rates in the 2000 and 2001 reports are not exactly comparable with previous years' data, but can be used to assess promotion rates across groups.
¹⁴ Pipeline indicators focus on grades A14 and A15 because promotions of economists to Grade A15 are limited to staff with clear potential to advance to the B level.