Voice

The crack in the BRIC

The latest Transparency International report on perceptions of corruption is out, and Russia doesn't fare well.

The country has dropped to 158th place (out of 178), and now shares a score of 2.1 with Cameroon and Tajikistan. It’s also the most corrupt of the Brics.....India came in at 116th, with a score of 3.4, while China ranked 78th at 3.5, and Brazil ranked 69th with a score of 3.7.

For a term coined by an investment bank almost a decade ago, the BRIC label has been remarkably durable. And at certain moments, the BRIC countries themselves have embraced a group identity, even holding summits the last two years. But the latest report raises the question of whether B, I, and C may not wish to be so closely associated with R in the future. After all, China's economic performance dwarfs Russia's. And Brazil and India are justifiably proud that they've managed to pair strong economic growth with vibrant democracy. If they do conclude that they're better off without being constantly linked to Russia, however, they'll have to figure out how to extricate themselves from a grouping they didn't create in the first place.

The Multilateralist

G-20 agrees to IMF reforms

One of the more concrete outcomes of last week's G-20 ministerial meeting in Korea was an agreement on changes in IMF governance, which managing director Dominique Strauss-Kahn called "the biggest reform ever in the governance of the institution." The months-long U.S.-led effort to shift power from what it considers overrepresented European states to emerging economies resulted in agreement to transfer two of the 24 board seats from Europe to emerging economies and to increase emerging economy voting share by at least six percent (although this may not be completed until 2012).

It's still not clear which European countries will lose their executive directors, though speculation is focused on Belgium and the Netherlands. (There are reports that the two might consider joining forces to retain a place at the table.) Nor is it clear who will fill the two soon-to-be-vacant board seats, although Strauss-Kahn suggested recently that Turkey would be a "good candidate."

Given that formal votes at the Fund are conducted on the basis of voting share, rather than board seats, it's easy to see all the jockeying over seats as a bit silly. But an IMF official recently reminded me that formal votes are rare and that, for the most part, the organization runs by consensus. The give-and-take in board meetings can be significant and executive directors with little voting power can, by dint of experience and expertise, "punch above their weight." Having a voice in the board room matters, and the jostling for seats will continue.