First up for Lagarde: Ethics training

Christine Lagarde has held three chairs in the French cabinet, helped run a major global law firm, earned several advanced academic degrees and is a member of the French Legion of Honor. Among her first duties as managing director of the International Monetary Fund: mandatory ethics training.

As part of the contract signed with her new employer, the former French finance minister — and first-ever woman to occupy the fund’s executive suite — will sit in one-on-one sessions with IMF ethics chief Virginia Canter and have it explained that the IMF encourages the advancement of women and discourages sexual harassment, bullying or other intimidation.

Down the road, she’ll be asked to complete the same sort of online programs and questionnaires that have become a staple of modern organizational life.

“You shall strive to avoid even the appearance of impropriety in your conduct,” Lagarde’s contract states, the first time such broad language on behavior has been included in an IMF managing director’s employment agreement.

For that, Lagarde can thank her fellow Frenchman Dominique Strauss-Kahn, whose resignation in May after an arrest and indictment on sexual assault charges triggered scrutiny of the fund’s ethics guidelines and workplace environment.

On Tuesday, the IMF published Lagarde’s contract, including her salary: $467,940 per year after taxes. That is a roughly $17,000 raise over Strauss-Kahn’s final salary, after a cost-of-living increase based on the consumer price index in the Washington area.

She will receive an additional $83,760 per year, also net of taxes, “to enable you to maintain, in the interests of the Fund, a scale of living appropriate to your position as Managing Director and to the Fund’s need for representation.” That payment is separate from any expenses claimed by Lagarde in performing her job.

Her first day included a full slate of meetings, including sessions with the top IMF staff members and a general “town hall” in the afternoon.

While the legal case against Strauss-Kahn appears to be weakening, as New York prosecutors question the credibility of the woman he is accused of assaulting, the soul-searching has continued at the IMF.

Lagarde, who took over the managing director’s office Tuesday, has spoken of the “wounds” left by recent events, while others wondered whether the IMF board erred in 2008 when it allowed Strauss-Kahn to continue in his job after having an affair with an IMF staff member.

The board took months to begin an investigation of the affair after first being informed of it, and struggled in determining what procedures to use and what standards to apply to an employee whom the board was responsible for overseeing.

Lagarde’s contract tries to prevent any future ambiguity.

“The fund has made a conscious decision to elaborate on what the highest ethical standards are via this contract,” said fund spokesman William Murray.

The agency had already tightened its staffwide ethics rules in May, before Strauss-Kahn’s arrest, in particular to require IMF employees to disclose if they were sleeping together so that any potential conflicts of interest could be resolved.

Later in the month, Canter instituted the first mandatory ethics training, covering “bullying, harassment and other forms of intimidation,” Murray said. Other material is being developed to deal with domestic violence, dispute resolution and financial conflicts. Online courses and other training programs will eventually be included, Murray said.

At the IMF’s sister institution, the World Bank, President Robert Zoellick has completed the ethics course mandatory for bank staff, according to a World Bank spokesman.

The decision to write new standards explicitly into Lagarde’s contract is a result of Strauss-Kahn’s peculiar tenure at the fund. Credited with revitalizing the agency through his work on the world economic crisis, he departed under a cloud — from the sexual assault charges in New York, the prior affair with a staff member, and frustration among some at the fund who felt his political ambitions were detracting from his job.

Strauss-Kahn was a likely candidate for the French presidency. Lagarde's contract includes tightened language prohibiting her from any publicly partisan activity while with the IMF.

“As Managing Director, you are expected to observe the highest standards of ethical conduct, consistent with the values of integrity, impartiality and discretion,” her contract states.

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