WASHINGTON, USA – The Inter-American Development Bank (IDB) launched organizational changes to increase the impact and scale of its development work throughout Latin America and the Caribbean.
It is time for a change. The IDB’s current organizational structure was created 17 years ago, while IDB Invest’s organizational structure was created eight years ago. The world has changed since then, and the IDB must change with it.
The organizational changes are part of IDB’s implementation of three transformational changes (IDBImpact+) approved by the Boards of Governors that includes (i) IDBStrategy+, the new institutional strategy, that focuses on three core areas: reducing poverty and inequality, promoting growth, and addressing climate change, (ii) IDBinvest+, the new business model with the $3.5 billion capitalization of IDB invest and (iii) IDBLab+, the new sustainable model of IDB Lab and $400 million replenishment.
Meeting the goals laid out in IDBImpact+ requires aligning the institution with them and better preparing it to deliver greater impact and scale.
The organizational changes place emphasis on key priorities. Here are some highlights:
Human Resources and Our People. Because the IDB’s employees are our most valuable asset and play a critical role in helping countries meet their development goals, we are creating a new vice presidency for human resources and digital transformation. This is important to ensure the institution is able to recognize the impactful work of our staff and to foster a collaborative and meritocratic environment.
Digital transformation. Technology is key to evolution. The new VP will also ensure we’re using the latest technology to be an agile organization that effectively meets the needs of its member countries and clients.
Effectiveness. Delivering better and more efficiently is crucial to having more impact on development goals. This has been a recurrent theme both at the IDB and with our fellow Multilateral Development Banks (MDBs). To improve the quality and effectiveness of our projects, we are creating a new strategic operational quality review division to work collaboratively with the rest of the Bank on project impact at all stages of the project evolution. We are also strengthening the risk management group to advise on project fiduciary risks, country exposure, and multi-risk impacts on portfolios and lending. Additionally, because critical social and environmental challenges persist across the region, the IDB is elevating the environmental and social solutions unit to a division.
Synergies and private sector
Development. Reinforcing synergies across the IDB will enable us to better promote the private sector as engine of prosperity in the region. We are creating the productivity, trade, and innovation sector, which will replace the current Integration and Trade Sector.
This new sector will include three divisions: Trade and Investment, Competitiveness, Technology, and Innovation, and Agriculture and Rural Development. Leveraging synergies across the organization’s three branches -the IDB, IDB Invest and IDB Lab- allows us to better help countries meet development goals.
Labor Markets and Social Protection. Human capital investment and strong labor markets are essential to promote economic growth in the region and reduce poverty. The new structure of the Social Sector places a strong emphasis on improving labor markets through the new labor markets and social protection division.
Knowledge. An important part of IDB’s role is to serve as a knowledge bridge between the region and the rest of the world. We are enhancing the IDB’s role as a Knowledge Bank. The knowledge and learning division will now report directly to the vice presidency for sectors and knowledge. people and policymakers need good research and high-quality information to make informed decision. To enhance research at the bank, we are elevating the role of the chief economist who will now also serve as the economic counselor of the president, reporting directly to the president.
Regional Integration: Promoting regional integration will help countries accelerate growth and tackle shared challenges. To support this effort, we are reforming the current Vice Presidency for Countries into the vice presidency for countries and regional integration. This change will enhance our programming capacity, strengthen regional dialogue, and develop a robust project pipeline that is better equipped to create regional and global public goods.
Security. We are tuned to the region’s current needs. There is a consensus that crime and violence pose a major development challenge to the region. Therefore, the IDB is creating a new citizen security division.
Innovation and IDBLab+. The IDB is increasing its capacity to drive innovation, empower entrepreneurs, and promote private-sector-led growth by implementing changes at IDB Lab, the IDB’s innovation and venture capital arm.
IDB Lab will now have four divisions: a Strategy, Knowledge and Impact Division, an Ecosystem Building and Acceleration Division, a Venture Capital Investments Division, and a Finance, Risk & People Management Division.
IDBInvest+, Mobilization and Originate to Share. To maximize the impact and scale of its work with the private sector, IDB Invest will expand from five to six departments. This includes the creation of a new financial solutions, mobilization and asset sharing department aligned with IDB Invest’s new “Originate-to-Share” business model. The new department will play a crucial role in developing innovative financial products and mobilizing resources to better serve the region’s needs. Additionally, IDB Invest has created four regional departments to continue improving dialogue with governments and private sector clients and increase its presence in the country offices.
These are only part of the overall changes. The changes will strengthen the IDB’s capacity to deliver better results in areas of growing strategic importance by aligning the bank’s people, incentives and culture with the more ambitious focus on development effectiveness. It will allow the IDB to better promote the changes throughout the region that benefit people and communities in tangible ways.
“We’re doing this to increase the impact and scale of our work. Countries face major challenges and we’re rising to the occasion to help them meet those challenges. The approval of these changes isn’t just good news for the IDB, it’s good news for the region because we’ll be better able to lift people out of poverty, create jobs and tackle climate change,” said IDB president Ilan Goldfajn.
We will start implementing some of these changes immediately.
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