Send Indra Nooyi to the World Bank

By Felix Salmon
March 2, 2012

When it comes to the World Bank presidency, pretty much everybody agrees on two things: (1) it shouldn’t be an American; (2) it will be an American. We can and probably should get hung up on (1), but given political realities, it makes sense to ask: if it’s going to be an American, then who should it be? It shouldn’t be Larry Summers, that’s for sure, and it shouldn’t be Jeff Sachs, either. But there’s another name floating around which is a much better idea than either of those two men: Indra Nooyi.

Nooyi, the chairman and CEO of Pepsico, has a lot of things going for her. Firstly, she’s a woman — and it’s generally understood that the Obama administration would love to nominate a woman to the job if it possibly can. Here’s Alan Beattie:

Bank policymakers say that the US proposing a female candidate – who would be the first woman to lead the institution – could help neutralise the charge that the appointment process was “business as usual”. Although administration officials have been cagey about likely contenders, candidates that have been discussed include Susan Rice, US ambassador to the UN, Lael Brainard, top international economics official at the Treasury, and Indra Nooyi, chief executive of PepsiCo. Laura d’Andrea Tyson, who was White House chief economic adviser to former president Bill Clinton, is also a possible contender.

Nooyi definitely stands out in that crowd. Rice, Brainard, and even Tyson are smart and capable technocrats — but they’re not leaders in the way that Nooyi is. One of the problems with US nominees to the Bank presidency is that they tend to be the kind of people who have risen to positions of importance (but never quite the very top) within their own organizations, without having ever had much visibility or power in the world more broadly.

The list of potential nominees from non-US countries is full of heavy hitters with serious global reputations, including quite a lot of former heads of state. The US nominee should be of that general caliber, if only to make it clear that the US takes the Bank seriously and isn’t steamrolling a number of extremely high-profile foreign candidates, only to install in their rightful place the Under Secretary of the Treasury for International Affairs. That’s an important job, to be sure, but it’s also a technocratic job where you always do what you’re told. It’s more fixer than leader.

Nooyi, by contrast, has led one of the world’s biggest multinational companies for five years, and has been in Pepsico’s C-suite for over a decade. During that time she has made a real and credible commitment to sustainability; she even managed to funnel $6 million to Sachs’s Earth Institute.

On top of that, she’s Indian. Born in Chennai, she didn’t arrive in the US until 1978, when she was 23. Nooyi’s an American now, and she’s certainly American enough to lead the World Bank, given the precedent of Jim Wolfensohn. But she wouldn’t only be the first woman to lead the Bank; she’d also be the first non-white person to lead the Bank. And that, of course, is something which is long overdue.

Nooyi is very comfortable among the upper reaches of global VVIPs, and, like Wolfensohn, she also has the significant advantage, for a World Bank president, of being rich enough to afford her own private jet. What’s more, the Bank job would allow her to turn even the criticisms of her tenure at Pepsico to her advantage. Consider this:

“It’s a very enticing vision to be more focused on health and wellness, to be focused on global hunger and all of those things,” says Ali Dibadj, an analyst with Sanford C. Bernstein & Co. “The problem is, you have to remember where three quarters of the company comes from: sugary, salty, fatty” foods.

Nooyi has at this point made more money than she could possibly ever spend; she’s clearly committed to making a difference in the world. And she’d be more able to do that at the helm of the World Bank than she would be staying on at Pepsico with restive shareholders pressuring her to sell more soda. Nooyi and the Bank need each other; her nomination makes perfect sense.

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Comments
12 comments so far

So because Pepsico is not able to make its number while trying to change its focus as being a purveyor of “useless calories” and more as seller of healthy snacks and low-cal drinks, then Nooyi should leave and try to do address hunger and malnourishment at the World Bank? She hasn’t beens successful at Pepsico, would her job be any easier at the World Bank convincing govts to free up trade and agriculture restrictions that create famine and malnourishment?

Posted by Ghoghogol | Report as abusive

This is a fascinating idea….

I wonder how she would get along with Legarde (Sp?) over at the IMF…

Posted by EconMaverick | Report as abusive

Yeah I am a little confused as to why this is a good idea other than she is a woman from overseas. Can’t we do a little better than that?

I am also completely unconvinced and confused by this line of argument:
“but they’re not leaders in the way that Nooyi is”

What does that mean and on what basis are you making that claim?

Why not start with the job description and work from there instead of moving straight to affirmative action?

Posted by QCIC | Report as abusive

I’m with the others, the article seems to be claiming that the World Bank presidency is a political sinecure, and thus we might as well use it to make an affirmative action statement.

But maybe Felix’ suggestion would make more sense if I had a better sense what the World Bank does and how her skills would fit the job?

Posted by TFF | Report as abusive

I agree completely Felix… Since we have to appoint an undeserving American we mine as well send Indra. Coke has out performed Pepsi in “the decade she’s been a C-level executinve.” Add to that being ashamed of her companies products and I suppose she should be looking for another gig.

While you’re at it why don’t we grant a female judge a lifetime appointment to the nations highest court dispite having her only reviewed cases overturned… oh wait… we already did that… so what if she’s 0 for 2… at least she’s hispanic!

I’ve got a novel idea… why don’t we fill each and every plum job with the canidate best qualified to fill that position reguardless of any other consideration whatsoever.

If that idea scares liberals a little too much we’ll comprimise… I’ll try and get my fellow conservitives to agree to tax the stuffing out of all the “winners” and absoutely pour money into public education starting from birth.

The country that manages to do that will rule this earth… my money is on South Korea.

Posted by y2kurtus | Report as abusive

Felix actually has managed to articulate the selection procedure exercised in case of most diplomatic dignitaries (I am considering the President of World Bank as a pseudo diplomat)through this. We should not be offended by his opinion because he is only presenting the bitter truth about selection/election/nomination procedures and how very little depends on the actual capability but largely on functionality. With the increasing resentment towards World Bank in developing nations with their ever increasing and expanding vicious cycle of debts, an Indra Nooyi may once again end up pacifying the situation ;p

Posted by Arindita | Report as abusive

And what exactly makes you think she is qualified for that?

Posted by QCIC | Report as abusive

Felix,

Why not get rid of the World Bank?

Posted by crocodilechuck | Report as abusive

QCIC, what makes you qualified to question someone else’s opinion? shut up already.

Posted by VTTV | Report as abusive

Felix, I don’t understand your point that the world bank has to be a diplomat. Is it like, the WB wants to give country X a loan and country X refuses so its chairman has to diplomatically persuade country X’s government to please, pretty please take their money?

No, the head of the WB has to be someone who is smart enough to understand how the bank can best use its resources so a developement economist sounds best to me.

Btw Larry Summers sounds to me much better than some MBA for corporate america; it’s not about whether she WANTS to help, it’s about whether she CAN help. So if she wants to contribute, she should simply do what Gates and Buffet did. The WB is an institution to alleviate poverty using the instruments of modern finance, not a charity where former CEOs go for a graceful retirement.

Posted by orionorbit | Report as abusive

VTTV-
A: My taxes pay for (a tiny portion) of the salary of the the person hired.
B: I am extremely intelligent (statistically speaking), and also have a fair amount of professional experience with hiring and selection committees.
C: If you (or Felix) want to use a public platform to advocate for a candidate for a very important pseudo-public office you should be prepared to give more reasons for your opinion than “they are a female minority”.

Asking why someone made an assertion is a valid contribution to a debate. Tell someone to shut up should get you kick out of said debate. If I were the moderator I would suspend your posting privileges. Learn how to be an adult please.

Orionorbit-
Exactly

Posted by QCIC | Report as abusive

PepsiCo was not created by Indra Nooyi but existed many years prior to her joining the company. Since then it has been selling salty snacks and sugary soft drinks – true. But Indra Nooyi has tried to steer the company towards a more sustainable business model while also sustaining earnings growth and profitability. So I believe one should get this straight. Indra Nooyi joined a company that sold unhealthy products. Since then, she has taken significant steps to improve the company’s product portfolio and its sustainability credentials. Definitely this shows that she has the best interests of the consumer and the planet and shareholders at heart. And let’s not forget, at the end of the day PepsiCO is a profit making company.

Posted by mpati | Report as abusive
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