There was one big positive yesterday (see post below). USG for Management Takasu stepped in and hit it out of the ball park, calling for a time out on revising and finalizing the MOU between the Fund Secretariat and OHRM.
Mr. Takasu said he was stepping in because of staff and retiree concerns. Further efforts and dialogue were needed, he noted, to ‘ensure a clear understanding on the initiative before finalizing the revised MOU.’
Some may focus their attention on what they perceive as a subtext of ‘everything’s fine, we just need time to convert non-believers.’ Those of us who’ve been watching the situation closely know well, as Mr. Takasu clearly does as well, that everything isn’t fine.
But why not instead embrace the essence of Mr. Takasu’s positive message of renewed efforts and dialogue, sensitizing staff and retirees, to ensure a clear understanding of what's at stake.
Mr. Takasu’s action appears to be a call for openness, transparency, collaboration – in essence calling a time-out on the single-minded rush to finalize rnew ‘administrative flexibilities’ which the CEO of the Fund says he absolutely must have in order to run an efficient operation, because the staff of the Fund are so “specialized.”
The GA said ‘review’ administrative arrangements; the Pension Board said ‘revise and make adjustments’. By many accounts, the CEO moved to overstep his mandate and accrue to himself not only more flexibility than already allowed by the elastic current MOU and staff rules and regulations. There’s also a provision in the redraft that could allow him to wrest authority over staff of the Investment Management Division from the Representative of the Secretary-General for Investments.
Therein lies one of the key dangers for the continued health of the Fund: a potential breach of the split between the Fund Secretariat and the Investment Management Division, one of the pillars on which the Fund’s current and continued health is based.
It’s good to have confirmation in his announcement that Mr. Takasu recognizes that retiree efforts made a difference in shedding light on this murky process, contributing to his decision to slow things down in a move toward meaningful consultation with key stakeholders, such as the Fund staff who are directly affected by these proposed changes.
Turning now to the 9 July 2015 response of the AFICS President, who says Mr. Takasu’s announcement vindicates AFICS/NY’s position that “the MOU did not require the involvement of retirees and should be left to those directly responsible to resolve.” In fact, Mr .Takasu mentions retirees as part of the motivation for his action not once, but at least four times in his announcement.
No one ever said retirees were part of the actual negotiations of the MOU. We may not be actors directly involved in the process, but we’re vital stakeholders. The AFICS President said so herself in her 29 May 2014 message, a position from which she’s clearly ‘evolved'. It's worth repeating for the record here:
"Retirees and participants are the parties most concerned with any developments affecting the Fund, and they should be fully consulted before any changes are made."
Back to the President's letter in which she’s “pleased that high level UN officials have decided to settle the issue by not moving ahead now on their own proposals”. How is the issue "settled"? I suppose that AFICS/NY is now off the hook for convening a meeting under the By-Laws before the Pension Board meeting.
Perhaps when we finally have the AFICS meeting we’ve asked for, an agenda item could be ‘how to breathe fresh life and energy - and responsiveness -- into the AFICS leadership cabal.’ None of us can recall any such discussion, ever. Its time has come.
Now to savoring the moment and heeding the President’s own exhortation “to adopt here a more positive tone.” Let’s be clear, however. Savoring where we are right now and what we’ve helped to achieve doesn’t mean we’re letting down our guard or dropping our vigilance.
Who knows where this new dialogue might lead? Drilling down to the heart of the obvious mistrust of management among Fund staff: fears that “administrative flexibilities” might mean a heavier dose of favoritism, and even retribution? Checks and balances on management’s conduct? Elimination of any provision that allows the CEO authority over investment staff? A recognition that there’s no need for a new MOU?
And remember, while the MOU has implications for future investment policy if the CEO is allowed authority over investment staff - thus breaching the split system -- it's only one of the balls we need to keep our eyes on concerning any trend toward riskier investments such as hedge funds.
So savoring the moment simply means that we’re choosing to take Mr. Takasu at his word; that his initiative signals back to the drawing board with the MOU, with the relevant parties engaged in meaningful consultations, clear-eyed on the need to safeguard staff rights, and the split structure, which are integral to maintaining the system of checks and balances that has kept our Fund healthy and sound up to now, and hopefully for current and future beneficiaries.
Savoring the moment also means we make it clear that we’re not a bunch of ingrates. We recognize responsible and responsive management when we see it. We see it here. Bravo Mr. Takasu.
Finally, we even entertain the slim possibility that AFICS may itself evolve on the issue. We’re ready, AFICS, your move.
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