A committee set up by the board of the World Bank to examine the affairs of its president, Paul Wolfowitz, has concluded there is a crisis in the leadership of the bank.
Mr Wolfowitz advised his partner Shaha Riza, an employee of the bank, on terms for her transfer to the State Dept, and personally indicated official approval for a $60,000 pay increase.
In its report, published last night, the ad hoc committee asks the bank's board to consider if Mr Wolfowitz is now capable of leading the bank.
When Mr Wolfowitz was appointed by President George Bush in 2005, his pre-existing relationship with Ms Riza meant under bank rules that she had to move to an alternative job outside the Bank.
Ms Riza's new role and a pay rise was approved by the bank's ethics committee. But Mr Wolfowitz 'engaged in a de facto conflict of interest' according to last night's report, by personally ensuring her conditions.
The report also concludes there is a crisis not only in the management ranks of the World Bank, but across the institution. It recommends the bank's board consider if Mr Wolfowitz can provide the leadership needed.
Mr Wolfowitz will present his side of the story when the bank's board meets later today.
A decision is expected later this week.
