The latter should comprise people who help to formulate the policies of their countries in national capitals, and so could not be full-time in Washington. The main function of the Executive Directors was not to manage the Fund, but to act as an essential link between the Managing Director and the national treasuries and central banks from which they were drawn. In retrospect, Keynes's position seems sound. Given the ease of modern travel – at least in comparison with 1946 - serious consideration should be given to a non-resident Board, meeting some six to eight times a year with directors comprising senior finance ministry or central bank officials. 6  BIS Review 11/2006  The process of shifting to a non-resident Board would bring the issue of the division of responsibilities to the fore. Member countries might conclude, for example, that they wanted to retain control of decisions to lend under the exceptional access framework. But in other areas, such as surveillance, it would make sense to delegate responsibility to the Managing Director in the context of a clearly defined remit. Moves in this direction would need to be accompanied by reforms to strengthen the accountability of the Managing Director. A first step in this direction would be to instigate regular IEO assessments on the effectiveness with which the Managing Director and staff had discharged their surveillance responsibilities. Finally, in terms of legitimacy, its members must feel that the ownership of the Fund is shared and that all have a voice.
That analysis should lead to an assessment of the risks to the world economy as a whole. The second task is to encourage countries to abide by their commitments to each other by promoting greater transparency about national policies. In agreeing the Second Amendment of the Fund’s Articles, all member countries made a general commitment to each other to pursue policies consistent with the objectives of stable global growth and low inflation. Only in relation to exchange rate arrangements were members asked to specify what framework they would follow to be consistent with this commitment. As Tim Adams, Under Secretary for International Affairs at the US Treasury, has noted recently, the nature of those commitments was left unhelpfully vague and should be clarified. In doing this, we should not lose sight of the fact that the policies of all significant members have spillover effects and all should be required to be more precise about their policy making frameworks. Clarity about the objectives of policy of member countries should make it easier for all countries to formulate their own policy. And by making their national policy frameworks sufficiently transparent, countries will be making it possible for the IMF to hold them to account and to fulfil its role as an umpire. The third task is the provision of a forum for national authorities to discuss risks to the world economy.