The Asian Development Bank (ADB) has revised its operating model to focus more on private sector development and climate change-related projects.
In a report on its new operating model, the Manila-based multilateral development bank said it would increase private sector financing to a third of its operations by 2024. The share of non-governmental operations (NSO) in bank operations was 27 percent in 2021.
The report also noted that by 2023, projects related to climate change will occupy 100 percent of its government operations and 85 percent of its NSOs, which are in line with the Paris Agreement.
“These reforms are both timely and essential,” ADB President Masatsugu Asakawa said in a statement. “Our new operating model will position us to better respond to the complex development challenges currently facing Asia and the Pacific. It builds on the core strength of ADB, our people who help us deliver solutions with the greatest development impact for the region.”
The focus on expanding the NSO will mean that the ADB will expand its Private Sector Operations Division (PSOD). This means hiring more staff with transactional skills in the private sector.
The report also noted that with regard to climate change, the Bank not only intends to increase project financing of adaptation and mitigation measures, but also intends to improve their quality.
“The changing development landscape prompted ADB to focus on aspects of its business where a paradigm shift would allow it to do more for and remain relevant to its DMCs. As a result, the organizational review focuses on four fundamental shifts: solutions, private sector development, climate change and ways of working,” the report said.
The roadmap is the result of an organizational review led by Asakawa that began in June 2021 and is based on the opinions of ADB’s regional customers, management, board and employees.
ADB said its review process is guided by the principle of maximizing its development effectiveness.
For ADB’s customers, the new operating model will improve the experience of working with the bank. ADB’s five regional divisions – covering Central & West Asia, East Asia, the Pacific, South Asia, and Southeast Asia – and resident missions in countries with offices will become a single window for all ADB products and services, both government and non-government.
People and expertise from the sectors, themes and other specialties in which ADB operates are consolidated, with increased deployment in regions and countries to offer a better choice and quality of solutions, resulting in more local staff work and be closer to the customers.
The new operating model is expected to be introduced in the second quarter of 2023. A phased implementation will minimize disruption to ADB’s customers and development partners.