Page 259 - DMGT401Business Environment

Business Environment

Notes 12.1.3 Organization of IMF

The IMF is accountable to its member countries, and this accountability is essential to its
effectiveness.
The day-to-day work of the IMF is carried out by an Executive Board, representing the IMF's 184
members, and an internationally recruited staff under the leadership of a Managing Director
and three Deputy Managing Directors – each member of this management team being drawn
from a different region of the world.
The powers of the Executive Board to conduct the business of the IMF are delegated to it by the
Board of Governors, which is where ultimate oversight rests.

Board of Governors

The Board of Governors are represented by all member countries and it is the highest authority
governing the IMF. It usually meets once a year, at the Annual Meetings of the IMF and the
World Bank. Each member country appoints a Governor – usually the country's minister of
finance or the governor of its central bank – and an Alternate Governor. The Board of Governors
decides on major policy issues but has delegated day-to-day decision-making to the Executive
Board.

Executive Board

It consists of 24 Executive Directors, with the Managing Director as Chairman. The Executive
Board usually meets three times a week, in full-day sessions, and more often if needed, at the
organization's headquarters in Washington, D.C. The IMF's five largest shareholders – the
United States, Japan, Germany, France, and the United Kingdom – along with China, Russia, and
Saudi Arabia, have their own seats on the Board. The other 16 Executive Directors are elected for
two-year terms by groups of countries, known as constituencies.
Key policy issues relating to the international monetary system are considered twice-yearly in
a committee of Governors called the International Monetary and Financial Committee, (IMFC)
(until September 1999 known as the Interim Committee). A joint committee of the Boards of
Governors of the IMF and World Bank called the Development Committee advises and reports
to the Governors on development policy and other matters of concern to developing countries.

Managing Director

The Executive Board selects the Managing Director, who besides serving as the chairman of the
Board, is the chief of the IMF staff and conducts the business of the IMF under the direction of the
Executive Board. Appointed for a renewable five-year term, the Managing Director is assisted
by a First Deputy Managing Director and two other Deputy Managing Directors.
IMF employees are international civil servants whose responsibility is to the IMF, not to national
authorities. The organization has about 2,800 employees recruited from 141 countries. About
two-thirds of their professional staff are economists. The IMF's 26 departments and offices are
headed by directors, who report to the Managing Director. Most staff work in Washington,
although about 90 resident representatives are posted in member countries to help advise on
economic policy. The IMF maintains offices in Paris and Tokyo for liaison with other international
and regional institutions, and with organizations of civil society. It also has offices in New York
and Geneva, mainly for liaison with other institutions in the UN system.

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