1 Independent Evaluation in IFC Presentation to Staff of Islamic Development Bank May 3, 2009 Marvin Taylor-Dormond

2 Constructing an Evaluation Framework Why do we evaluate?

3 Accountability Learning Allocation of resources / Better results

4 Director-General, Evaluation (DGE) IEG: independent reporting President World Bank Group Board Multilateral Inv. Guarantee Agency World Bank IEG-MIGAIEG-WB IEG-IFC

5 Micro Evaluation Macro/Aggregate Evaluation Quality, Knowledge, Partnerships, Communication IEG-IFC structure

6 Micro Evaluation IEG-IFC structure

7 Independent project-level evaluation of IFC’s investment and advisory operations Accountability for IFC’s operations at the project level Provides the foundation for IEG’s macro evaluations Scope of micro evaluation

8 Self-evaluation – IFC Staff IFC staff prepare Expanded Project Supervision Reports (XPSRs) Evaluation of investment projects (XPSR system) Independent Evaluation - IEG-IFC Sample selection Guidance Independently validated XPSR ratings Collect and disseminate lessons Desk-based or field-based validations Mini-XPSRs / Project Evaluation Summaries

9 Independent Evaluation - IEG-IFC Independent evaluation / validation of PCRs Desk review of adherence to guidelines in PCR ratings Desk and field reviews for validation of results Evaluation of advisory services (PCR evaluation) Self-evaluation – IFC Staff IFC staff prepare Project Completion Reports (PCRs)

10 Measuring development Development Effectiveness Development Outcome Investment Operations Advisory Services Project Business Success Economic Sustain- ability Environ- mental & Social Private Sector Devpmnt Strategic Relevance Output Achievement Outcome Achievement Impact Achievement Efficiency

11 Highly unsuccessful UnsuccessfulMostly unsuccessful Mostly successful SuccessfulHighly successful 1. Project’s Development Outcome SatisfactoryExcellentUnsatisfactory Partly Project’s impacts on:  Business success  Economic sustainability  Private sector development  Environmental & social effects      Investment project evaluation: Ratings XPSR example: Real Sector

12 Macro/Aggregate Evaluation IEG-IFC structure

13 Focus on and inform IFC’s strategies, policies & procedures Provide accountability Country, sector, & thematic evaluations Forward-looking Scope of macro evaluation

14 Studies Country and regional Thematic Sectoral Corporate Process

15 Five drivers explain two- thirds of project outcomes Five Outcome Drivers

16 Frontier strategy targets high-risk countries Success rates were HIGHER for projects in countries that were HIGH risk at approval Country risk at approval: Development Success rate, (%)

17 Improvement in business climates key to success Country risk changes from Approval  Evaluation Development Success rate, (%)

18 A low-quality sponsor can jeopardize project success IEG defines sponsors in terms of experience, financial capacity, commitment, and reputation Low sponsor quality was prevalent in about % of IFC commitments between 2002 and 2008 Sponsor quality can vary considerably by sector, and even within the same sector

19 Better work quality leads to better outcomes Work quality comprises: Screening, appraisal and structuring Supervision & administration Role & contribution throughout investment cycle With high work quality: Development success increased from 18% to 73% Investment success increased from 52% to 74%

20 Tracking Recommendations Management Action Tracking IFC updates status and level of adoption (LOA) Annual Updates IEG updates its own Assessment of the status and LOA IEG and IFC agree on appropriate indicators Step Two IEG recommendation and IFC Management response recorded Step One Internal Publication External Publication Dissemination

21 Knowledge, Dissemination, Communication IEG-IFC structure

22 What we do Disseminate lessons learned from IFC’s experience among staff for better operational results Build knowledge on private sector development issues Disseminate IEG evaluations to public-at- large for accountability and awareness Develop and foster partnerships with evaluators in other development institutions

23 Products we offer

24 Easy search Featured lessons Newest lessons E-LRN Home page Most commented lessons Best lessons

25 Independent Evaluation of IFC’s Development Results 2007 & 2008 Evaluation of IFC’s Private Enterprise Partnership Program – Europe and Central Asia Evaluation of IFC’s Assistance to Micro, Small and Medium Enterprises Ukraine, Indonesia and Nigeria Country Impact Reviews Evaluation of WBG’s Experience with Guarantees Reports disclosed to date…

26 BROE: Adequacy, coverage, and quality of IFC’s development results measurement systems Health: An assessment of the WBG’s support for health, nutrition, and population since1997 Two recent reports…

27 Accountability & Dissemination

28 “I could tell you of projects that failed because lessons were ignored or missed” 75% of respondents the June 2005 IFC Knowledge Survey Learn from experience …

29 Call, , stop by! IEG can help get better results IEG Help Desk 1 (202)

30 Independent Evaluation in IFC Presentation to Staff of Islamic Development Bank May 3, 2009 Marvin Taylor-Dormond