Lagarde’s employment contract

By Felix Salmon
July 6, 2011
a tough ethics clause into Christine Lagarde's employment contract:

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The IMF, quite rightly, is putting a tough ethics clause into Christine Lagarde’s employment contract:

Her terms of employment were made public as she arrived at the International Monetary Fund’s Washington headquarters…

Lagarde’s contract holds her to “highest standards of ethical conduct consistent with the values of integrity, impartiality and discretion.”

It also requires her to avoid “even the appearance of impropriety.” Further, it states that “in the performance of your duties as managing director, you have an exclusive duty of loyalty to the fund and shall avoid any conflict of interest or the appearance of such a conflict.”

This is all welcome stuff, although it could conceivably cause a kerfuffle if the French Court of Justice breaks against her in its investigation over her involvement in a dispute involving Bernard Tapie.

But what does it mean, exactly, to say that Lagarde’s “terms of employment were made public”? I spent a bunch of time burrowing around the IMF website this morning trying to find them, without success. Eventually the Guardian came along to solve the problem: its article on Lagarde’s contract links the phrase “terms of appointment” here.

As you might expect when a URL has the term “protected” in it not once but twice, clicking on that link will get you just as far as a big green box with a padlock on it and the words “secure area” in all caps.

I do understand why it makes sense for the IMF to have a secure media briefing center apart from the press-release area on its website: such things come in handy for embargoed content, and the IMF releases a lot of that. But there’s no reason why Lagarde’s terms of employment should have been embargoed, and even if there was, there’s no reason for them still to be missing from the main IMF website.

This isn’t in itself an ethics issue — it’s a transparency issue, which is related but not identical. I do think that the IMF and the World Bank tend to be a bit sheepish about their pay levels, not least because if you’re not a US citizen, all that money — $467,940 a year, in Lagarde’s case, plus an allowance of $84,000 — comes to you tax-free.

Lagarde was almost certainly earning more, even on an after-tax basis, when she was at Baker & McKenzie, but she’s still being paid substantially more than any elected head of state in the world. If the job of IMF managing director is a public-service one, one wonders why her salary needs to be so high.


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If you click on “For journalists,” the press release page comes up, leading you right here. No secrecy. 11/pr11270.htm

Posted by PBelenky | Report as abusive

“…she’s still being paid substantially more than any elected head of state in the world. If the job of IMF managing director is a public-service one, one wonders why her salary needs to be so high.”

I believe in Singapore both the head of state ( of_Singapore) and high-level government officials ( _Singapore) make substantially more than Lagarde. It’s also a famously competent government, which is probably not unrelated to this.

Posted by dsfan | Report as abusive

OK Felix, why was DSK ousted and LaGarde brought in? The rape case is a farse and we all knew it the day it was announced. I just couldn’t figure out why they wanted him out? Was he not going to support Greece? Turkey? Was he going to let them default? There has to be a resaon that he was destroyed like this.
So Felix, why was he ousted?

Posted by tmc | Report as abusive

The per diem and the expense account are intended
“to enable you to maintain, in the interests of the Fund, a scale of living appropriate to your position as Managing Director and to the Fund’s need for representation.”

It sounds like the logic that was used in pre-revolutionary France that demanded that a nobleman spend lavishly to maintain a life style befitting his rank. In other words, compulsory conspicuous consumption is part of her job description.

If Ms. Lagarde is expected to live in a gilded cage does that also imply that the IMF expects those who don’t occupy such lofty and specialized positions to retreat to garbage cans and filth as appropriate for their low value in society?

Those conditions make that tight fisted Hattie Green of Wall Street lore look like she was no nonsense and all business by comparison. I suppose no one love’s Warren Buffet’s choice of modest living standards anymore? He was always fighting a head wind.

It is obvious that modern society cannot make up it’s mind about what it expects from wealth or poverty but I’ve never heard of a built in dress for success clause. I always thought it was assumed.

As a self employed person I don’t need a lavish dress code as part of my job description and so many would like those allowance to maintain appearances – my sister for one, who is a glutton for money , that I wonder if it is usually a part of corporate contracts in general?

It seems a surprising allowance among other allowances, for a person who is otherwise taking a position that recently was nearly anonymous. It also stinks that people in her position are being paid to set lifestyle standards that so many others will ape yet can’t afford. That’s been a constant complaint in these comment pages for the past few years.

You can drape a rattle trap in brocade and it will still eventually collapse from it’s own slipshod carpentry.

Posted by paintcan | Report as abusive