August 14, 2022

In Her First Week, Lagarde Stresses Diversity at I.M.F.

Ms. Lagarde, formerly the French finance minister, faces the challenge of lifting the morale of bruised employees even as the fund confronts one of its greatest tests, preserving the financial stability of Europe.

On Tuesday, she held a meeting at the fund’s headquarters in Washington to introduce herself to the staff, which is still shaken by the abrupt resignation of her predecessor, Dominique Strauss-Kahn, after he was charged with the sexual assault of a hotel maid. On Friday, she holds her first board meeting to consider another round of emergency funding for Greece.

“I thought it was necessary to come back to D.C. very promptly simply because there are so many issues to address,” Ms. Lagarde said by way of introduction to her first official press conference. “It cannot wait for another summer holiday. Here I am, and for good.”

When Ms. Lagarde last met with reporters at the fund’s headquarters, during the organization’s annual spring meetings, she appeared as a representative of France and made a point of speaking mostly in French. On Wednesday, settling into her new role as an international official, she spoke exclusively in English, even when addressed in French.

She mostly dodged questions about Greece, saying that she would not prefigure Friday’s meeting, but she did provide a measure of her thinking on the fund’s mission and priorities.

Mr. Strauss-Kahn, a member of the Socialist Party in France who expanded the fund’s traditional focus on financial stability to include broader goals like reduced unemployment, argued that the benefits of prosperity did not necessarily flow to the broader populace, and that the fund needed to measure its success in terms of that broader impact.

Ms. Lagarde, by contrast, is a political conservative. She said Wednesday that people should judge her tenure by her actions rather than making assumptions based on political labels. She said that she needed time to study the fund’s policies before offering her own opinions.

But she sounded a note of caution about those policies at the outset.

“We should not become a specialized boutique to reduce unemployment,” she said, although she added that she did support elements of the fund’s current “comprehensive” approach.

“Some of the things that Dominique Strauss-Kahn has started are excellent reforms,” she said, including the “comprehensiveness that we should adopt embracing the unemployment and social issues as well as the economic trends that are more traditional.”

Much of the press conference was devoted to questions about the fund itself. Mr. Strauss-Kahn was allowed to remain atop the fund after the disclosure of an affair in 2008 with a subordinate, a decision that some considered a mistake at the time, and many more came to regret.

A number of women have come forward in recent months to describe the fund as a problematic workplace, where superiors often felt free to press subordinates for dates and little effort was made to prevent or to punish sexual harassment.

Ms. Lagarde campaigned to replace Mr. Strauss-Kahn largely on the strength of Europe’s determination to maintain leadership of the fund, particularly at a time when its primary challenge is to help the governments of Europe.

The fund was created by the United States and its allies after World War II as a lender of last resort for troubled governments. Since that time it has always been run by a European, though the United States maintains effective control.

Ms. Lagarde has said on several occasions, however, that a female executive would be an advantage for the fund, reducing what she described as the level of testosterone.

On Wednesday, she added a personal note: “For all the young girls that are in school at the moment, I’d like to say that they should each consider that everything is possible,” she said.

But she was otherwise more circumspect, speaking repeatedly about the importance of diversity.

“Together with diversity comes respect for everybody,” Ms. Lagarde continued, “and it’s been the case in the past that people have been respected and I will make sure that they continue to be respected no matter what their differences are.”

The fund has made a number of recent changes in its policies to improve its workplace culture. Ms. Lagarde’s contract includes a number of brand-new injunctions, including, “You shall strive to avoid even the appearance of impropriety.” And Ms. Lagarde noted Wednesday that she would soon attend a new ethics program now required for all employees.

Ms. Lagarde will make $467,940 in her new job, plus a stipend of $83,760, all of it untaxed.

She also addressed Wednesday widespread speculation that the fund would elevate a Chinese executive, Min Zhu, to the rank of deputy managing director.

Three people now hold that title. One of them, John Lipsky, an American, plans to retire at the end of August. But the United States is likely to insist on an American replacement.

Ms. Lagarde said the most likely solution was to name a fourth deputy.

It is, she said, “not a bad idea, and I’m going to consult in the next few days on this matter.”

Article source: http://www.nytimes.com/2011/07/07/business/in-first-week-on-the-job-lagarde-stresses-diversity.html?partner=rss&emc=rss

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