The OECD Selects Mathias Cormann as Next Secretary-General: Lessons Learned for the United States

The competitive selection of Australian Mathias Cormann on March 12 as secretary-general of the Organization for Economic Cooperation and Development (OECD) offers important lessons for what it takes to win a leadership position in an influential multilateral organization. Though an undoubtedly complex process, these critical questions break down the competing factors and strategic steps taken to secure his victory. His case provides important lessons for candidates from the United States and its allies who seek multilateral leadership, especially during an era when competitors have increased interest in the same positions.

Q1: What is the OECD secretary-general selection process?

A1: Cormann officially became OECD secretary-general-select on March 15, 2021, and he will begin his five-year term on June 1 after Angel Gurría steps down from his 15-year tenure. The actual selection process began six months ago in September 2020. Ten candidates were nominated by member countries, and the selection committee then held preliminary interviews in December. In January, the selection committee began five confidential rounds of consultation. The last round, which took place in March, featured Cormann and Cecilia Malmström of Sweden.

Candidates and countries nominating candidates face specific incentives from the electoral system that shape how they present themselves during campaigns. To choose a secretary-general, the OECD does not undergo a formal election, but rather a consensus-based selection where member countries are consulted in rounds until one person is left standing. While the OECD Council, the organization's overarching decisionmaking body, does vote to officially appoint the next secretary-general, this process is more of a formality as only one candidate is selected to be confirmed.

It is difficult to determine exactly what put Cormann ahead of other candidates. However, in examining his strategic approach of maintaining a relatively low public profile, addressing weak spots in his political record, and privately wooing global leaders, we gain important clues to be successful in similar races.

Q2: How important is home country support for a candidate’s success?

A2: Only country representatives are a part of the official OECD consultation and confirmation process, and they play an important role in boosting support for their preferred candidates. For nominating countries, the amount of support and political capital they put into ensuring their candidate’s selection can make or break a campaign—if the nominating country is not enthused, how can they effectively convince others?

When comparing Cormann to his competitors, there was a difference in the level of home country advocacy. The Australian government was extremely supportive of Cormann, lobbying heads of state like President Joe Biden on his behalf and providing opportunities for Cormann to directly speak with leaders. These actions were indicative of Australia’s strong conviction for a secretary-general from the Asia-Pacific. Australian prime minister Scott Morrison even went as far to say that Cormann’s bid was “the most important Australian nomination for a major international body in decades” when first announced in October. Conversely, Cormann’s closest rival, Malmström, lacked the same level of enthusiasm from her government, despite the fact that winning was likely a priority for Stockholm.

Underlying domestic political dynamics are likely one reason for this divergence. Cormann recently served as finance minister under Australia’s ruling Liberal-National Coalition. He was a known entity to the government, which was invested in his candidacy for the Liberal Party’s political image. Prime Minister Morrison himself may have been especially motivated, because Cormann’s support for removing ex-prime minister Malcolm Turnbull paved the way for him to become prime minister. Malmström, on the other hand, has spent the past decade in European politics instead of at the national level. She also has long been affiliated with the Liberal Party in Sweden, whereas the country is currently led by a coalition between the Social Democrats and Greens with the Liberal Party only in general support. Her distance from both domestic politics and the current parties in power may have lessened incentives for Sweden to fight for Malmström, putting her at a disadvantage.

However, it is important to add the caveat that the support of a candidate’s affiliated country can in some cases damage their chances. If the nominating country has a mixed or poor record in international institutions, member states may be less inclined to voice support. The qualified and potentially competitive U.S. candidate, Chris Liddell, withdrew from the OECD selection process in January after the riots at the U.S. Capitol building and given the incoming administration would be unlikely to support a candidate associated with former president Donald Trump. Similarly, some countries may have been wary of supporting Greek candidate Anna Diamantopoulou as a result of general skepticism due events like Greece’s debt crisis or its naming spat with North Macedonia.

Q3: What are the background and skills of a successful candidate?

A3: Having multilateral experience is not necessarily a hard prerequisite to running a successful race. While Malmström most recently served as European trade commissioner (2014-2019) and Diamantopoulou served as European commissioner for social affairs (1999-2004), general political experience and a robust global network may be the more important thresholds. Cormann has limited multilateral experience and spent the last 13 years as a member of Australian parliament, serving as minister of finance since 2013. However, he did begin his early political career in his native Belgium and speaks multiple languages. A similar pattern can be seen in the candidacy of Philipp Hildebrand, one of the final four candidates, who has spent most of his career in the private sector other than a nine-year stint on the governing board of the Swiss National Bank.

Q4: How does the history and forward trajectory of the organization shape the selection?

A4: Some multilateral organizations have implicit rules for divvying up top leadership roles among member states. At the World Bank and the IMF, for example, the “gentlemen’s agreement” maintains that an American will serve as the president of the World Bank and a European will serve as the managing director of the IMF.

At the OECD, norms—not rules—guide the secretary-general selection. Considerations of member-state makeup and the history of who has served as secretary-general are generally important. The first three secretaries-general from 1961-1996 were all European, representing Denmark, the Netherlands, and France. However, the past two secretaries-general were from Canada and Mexico. As around 70 percent of member states are European, some believed that it was now Europe’s “turn” again to lead the OECD.

Simultaneously, the future-oriented view of the organization’s trajectory may have shaped the selection. While historically a European and North American organization, more states from Latin America and the Asia-Pacific have joined in recent years, expanding the OECD’s global reach. Thus, support for a leader that represents the new, more global grouping likely played a role in Cormann’s selection, as he was the only non-European or non-North American candidate.

Q5: What were the primary policy issues during the campaign trail?

A5: As one of the world’s preeminent standards-setting organizations, candidates for OECD secretary-general must contend with a variety of policy issues, such as the contentious debate over digital taxes or foreign aid accounting. Other important issues included post-Covid-19 recovery, the environment, democratic backsliding, and OECD engagement with emerging markets.

The policies of Malmström and Cormann indicate they targeted the support of different member states. To secure European support, Malmström likely took a stronger stance than Cormann on taxing companies that provide digital services within foreign countries, encouraging inclusive economic development, and addressing climate change. Cormann, likely trying to win non-European votes, championed greater engagement with the Asia-Pacific and was softer on digital taxation, a contentious point for U.S. technology companies.

The expected managerial styles of Malmström and Cormann also likely impacted the selection. Similar to current secretary-general Gurría, Malmström was expected to be a more prominent leader and involved in internal policy process, while Cormann was expected to be more deferential to member states.

Policy debates during the selection process also provide a broader lesson for candidates in consensus-style processes. Having a policy platform that wows member states may be less important than ensuring that chosen policies do not offend certain constituencies that could block selection. Cormann’s record on climate change in Australia as a leader in the conservative wing was routinely criticized throughout the selection process, possibly threatening his chances. However, he was able to rectify member state concerns through individual consultations and a public declaration of his commitment to achieving global net-zero emissions by 2050.

Q6: How does the broader geopolitical climate factor into leadership decisions?

A6: As Covid-19 exacerbates a preexisting tide of authoritarianism, the threat of great power competition between democratic states and states exporting authoritarianism, like China and Russia, continues to mount. China’s growing interest and influence in multilateral organizations may preclude accountability mechanisms—specifically those associated with good development practice—from operating transparently and appropriately.

Looking forward, the OECD, as an exclusive group of 37 of the world’s most advanced free-market economies, may become a leading forum for like-minded states to organize a comprehensive response and improved accountability for development standards among donors. China’s unique role in the OECD as a partner country—not a full member state— also provides the organization greater latitude in crafting candid and concerted international action.

For member states concerned about authoritarian states gaining influence, the selection of the secretary-general was an opportunity to signal medium-term intentions of the organization. Cormann’s selection sends a clear message that the OECD is not willing to cede the Asia-Pacific region to the influence of authoritarian states. China’s recent economic embargo of Australia likely also was a factor for a number of countries, including Canada and the United States, who supported Australia.

Lessons for the United States

Though geopolitics have changed dramatically post-World War II, the United States remains a preeminent player in the world’s increasingly complex ecosystem of multilateral institutions. However, the importance of these institutions for U.S. political, economic, and national security strategy is, at times, undervalued and misunderstood by policymakers. This disconnect has rapidly decreased U.S. influence, providing room for those that would like to alter multilateral foundations for their own gain. U.S. competitors have often used the strategy of winning leadership positions in multilateral organizations for great power competition. The United States, however, has done the opposite in recent years.

President Biden has shown a commitment to reassert U.S. multilateral leadership. Improving U.S. leadership within international organization system should be a priority. The United States has no shortage of talented and qualified people within or outside the government that could serve in multilateral organizations. However, to support them effectively, Washington needs a strategic effort to win key races. The Biden administration should draw a number of lessons from Cormann’s OECD campaign.

  • The United States should assert effective and sustained diplomatic leadership in multilateral institutions. Its global reputation and actions have an impact on candidates’ success.

  • The United States should adapt its strategy within international organizations to one with a great power competition lens, especially for top leadership posts like the OECD secretary-general that could be called the “commanding heights of the multilateral system.” This is particularly relevant where China has shown an interest in doing the same or where particular nationalities of candidates are suited to address that effort.

  • The United States should be publicly and consistently enthusiastic about their candidates. This means modernizing and innovating new campaign strategies and approaches. In addition to nominating qualified candidates, it should exert the political will for them to succeed. Prime Minister Morrison’s role in advancing Cormann’s candidacy provides an important example of what this looks like.

  • The United States should provide candidates with adequate resources and support during the campaign period. Without the support of the Australian government (including a team of nine people in the foreign ministry running the diplomatic campaign, travel, and logistical support) to pursue multiple international tours, Cormann likely would have struggled to win over a multitude of member states.

Over the next several years, a number of international organizations will have important leadership races, including the International Telecommunications Union, World Health Organization, and International Labor Organization in the next year alone. If the United States wants to “get back on the horse” in multilateral leadership races, learning from Cormann’s success would be a good place to start.

Daniel F. Runde is senior vice president, director of the Project on Prosperity and Development (PPD), and holds the William A. Schreyer Chair in Global Analysis at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Christine Li is an intern with the CSIS Project on Prosperity and Development.

Critical Questions is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

© 2021 by the Center for Strategic and International Studies. All rights reserved.

Daniel F. Runde
Senior Vice President; William A. Schreyer Chair; Director, Project on Prosperity and Development

Christine Li

Intern, Project on Prosperity and Development