The World Bank’s 25-member executive board on Wednesday elected former Mastercard CEO Ajay Banga to a five-year term as president, effective June 2, the bank said.
Banga’s election ushers in an Indian-born finance and development expert charged with revamping the lender to tackle climate change and other global crisis.
Banga, 63, was nominated for the post by U.S. President Joe Biden in late February and was the sole contender to replace departing World Bank chief David Malpass, an economist and former US Treasury official who served in the Trump administration.
Malpass, who faced criticism for his stance on climate change, with former U.S. Vice President Al Gore labelling him a climate denier and climate activists calling for his resignation, announced earlier this year in February that he would step down in June nearly a year earlier than his five-year term. Malpass’ last day at the bank will be June 1, according to Aljazeera.
Banga’s election came after World Bank board members interviewed him for four hours on Monday. The decision came in a vote by 24 of the board’s members, with Russia abstaining, instead of the usual consensus-based process, a source familiar with the process said.
The World Bank, in a statement, said the Executive Directors followed the selection process agreed by shareholders in 2011.
The process included an open, merit-based, and transparent nomination where any national of the Bank’s membership could be proposed by any Executive Director or Governor through an Executive Director. This was then followed by thorough due diligence and a comprehensive interview of Mr. Banga by the Executive Directors.
“The Board looks forward to working with Mr. Banga on the World Bank Group Evolution process, as discussed at the April 2023 Spring Meetings, and on all the World Bank Group’s ambitions and efforts aimed at tackling the toughest development challenges facing developing countries,” the bank said.
President Biden congratulated Banga on his “resounding approval” to run the World Bank, which he described as “one of humanity’s most critical institutions to reduce poverty and expand prosperity around the globe”.
“Ajay Banga will be a transformative leader, bringing expertise, experience, and innovation to the position of World Bank president,” Biden said. “He will help steer the institution as it evolves and expands to address global challenges that directly affect its core mission of poverty reduction — including climate change.”
United States Treasury Secretary Janet Yellen said Banga brought the “right leadership and management skills” to the job, and would play a critical role in pushing forward with additional reforms, including by forging partnerships between the public and private sectors and nonprofit groups.
“Ajay understands that the challenges we face – from combatting climate change, pandemics, and fragility to eliminating extreme poverty and promoting shared prosperity – are deeply intertwined. He has effectively built a broad global coalition around his vision for the Bank over the course of his candidacy,” Yellen said in a statement.
Who is Banga Ajay?
Ajaypal Singh Banga, born November 10, 1959, is an Indian-born American business executive. Ajay Banga most recently served as Vice Chairman at General Atlantic. Previously, he was President and CEO of Mastercard, a global organization with nearly 24,000 employees.
Under his leadership, MasterCard launched the Center for Inclusive Growth, which advances equitable and sustainable economic growth and financial inclusion around the world. He was Honorary Chairman of the International Chamber of Commerce, serving as Chairman from 2020-2022.
He became an advisor to General Atlantic’s climate-focused fund, BeyondNetZero, at its inception in 2021. Banga served as Co-Chair of the Partnership for Central America, a coalition of private organizations that works to advance economic opportunity across underserved populations in El Salvador, Guatemala, and Honduras. He was previously on the Boards of the American Red Cross, Kraft Foods, and Dow Inc.
Ajay Banga is a co-founder of The Cyber Readiness Institute and was Vice Chair of the Economic Club of New York. He was awarded the Foreign Policy Association Medal in 2012, the Padma Shri Award by the President of India in 2016, the Ellis Island Medal of Honor and the Business Council for International Understanding’s Global Leadership Award in 2019, and the Distinguished Friends of Singapore Public Service Star in 2021.
The President of the World Bank Group is also the Chair of the Board of the Executive Directors of the International Bank for Reconstruction and Development (IBRD). The President is also ex officio chair of the Board of Directors of the International Development Association (IDA), International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and of the Administrative Council of the International Center for Settlement of Investment Disputes (ICSID).
