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The World's Banker
Topics: Finance-Banks and BankingEconomics-Developing Countries and EconomiesOne day in July 1995, shortly after his appointment to head the World Bank, Jim Wolfensohn took time out from a project visit in the African bush for an impromptu chat with a village official. For those present, it was a memorable sight: the World Bank's president strolling hand in hand, in the African manner, with the local chief, the two men deep in conversation about rural issues. The tableau seemed confirmation that Wolfensohn himself embodied the grassroots, humane approach he has espoused as essential for the troubled Bank.
Accustomed to sharing the spotlight with the glamorous and powerful in the world's great capitals, Wolfensohn might nonetheless rank his interactions with village chiefs and local leaders as among the most rewarding of his career. For even as he enjoyed a remarkable career in the private sector, Wolfensohn had always displayed a fundamental commitment to social responsibility and helping the less fortunate.
Since becoming head of the Bank, Wolfensohn has traveled extensively around the world, not only visiting development projects but reaching out to representatives of government, business, labor, environmental, and nongovernmental organizations. He has initiated a multilateral debt relief program for the heavily indebted poor countries, with the Bank committing some $2 billion to this effort. New strategic partnerships have been formed with a variety of development-oriented groups, organizations, and financial institutions.
Wolfensohn is convinced that the Bank has an indispensable development role: to help finance and assist the desperately poor countries that seldom see private capital. But he also believes the institution must justify its continued existence through superior performance. To achieve that, Wolfensohn knew the Bank needed to change. "The World Bank must be based on results, not process," he says. "To do that, we need to become more decentralized, creative, and entrepreneurial -- in effect, to think and operate more like a private-sector business. EDP will help accomplish that."
While many observers believe Wolfensohn faces a herculean task, his supporters remain optimistic, buoyed by his record of achievement and his legendary ability to charm and persuade. Born in 1933 to a modest middle-class family in Sydney, Australia, where he attended university and law school, Wolfensohn served as an officer in the Royal Australian Air Force, was a fencer on the 1956 Australian Olympic team, and practiced law prior to attending HBS. After graduation and work at a Sydney merchant bank, in 1967 he accepted a position in London with J. Henry Schroder Wagg and later moved to the firm's New York office. Ten years later, he was named chairman of Salomon Brothers International and remained with Salomon until 1981, when he opened his own Wall Street investment banking boutique, James D. Wolfensohn, Inc.
From 1980 to 1986, in addition to his full-time Wall Street duties, Wolfensohn became the chairman and savior of Carnegie Hall, New York's financially troubled arts mecca that was then on the brink of collapse. A lover of the arts (and an accomplished cello player despite first taking up the instrument in his forties), Wolfensohn then orchestrated similar magic as chairman of the struggling John F. Kennedy Center for the Performing Arts in Washington, D.C.
A past president of the International Federation of Multiple Sclerosis Societies and board member and trustee of numerous nonprofit, academic, and international relations organizations, Wolfensohn has been honored and decorated by countries around the world for his public service, including an Honorary Knighthood from Queen Elizabeth II. He is currently chairman of the board of the Institute for Advanced Study at Princeton University.
Today, over two years into his tenure at the Bank, Wolfensohn is deeply absorbed in his latest turnaround effort and more convinced than ever of its importance. "This job," he concludes, "has taught me about the nobility and capacity in the people we are trying to assist. They deserve our support."
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