For all his reputation as a hard-driving boss, Robert Zoellick is in listening and healing mode as he prepares to succeed Paul Wolfowitz as World Bank president.

The former US trade representative and deputy secretary of state says his immediate priority will be to restore calm and purpose to bank staff, who rebelled against Mr Wolfowitz over his handling of a secondment package for his girlfriend.

“I am going to be focusing very heavily on the staff and getting to know the management. I want to give these people a sense that I know their qualities,” Mr Zoellick pledges in an interview with the Financial Times in a grand but borrowed office at the US Treasury, adding: “People need to be treated with dignity.”

Yet for Mr Zoellick, the healing once he takes over this weekend is not just about addressing internal complaints. “The thing that will draw us most together is a sense of common mission and purpose,” he says.

Since being nominated by President George W. Bush, Mr Zoellick has worked a global contact book for advice on how to take the bank forward. A two-week tour of Europe, Africa and Latin America – marred only slightly by a controversy over tough remarks he made on Venezuela – exposed him to the extraordinary variety of tasks the bank’s global stakeholders want it to perform.

Europe was looking to the bank to play a larger role in climate change, Africa for it to keep poverty reduction as its main focus, Latin America for it to develop more effective ways of helping middle-income countries.

People who know Mr Zoellick say he is eager to start a debate within and around the bank on the questions facing the world’s leading development agency. In time this would lead to the articulation of a clear strategy.

He may find himself spending more time than he would care dealing with the conflict that still rages inside the bank. For now, he is seeking to adopt a balanced stance on the issue of corruption and its place in the development agenda. “There can be no movement away from [the view of] corruption as a cancer on development,” he says. But the bank also has to think about questions such as “what is most effective?” and “do poor countries get penalised twice?” He says there are “positive steps” it can take to “build capacity, encourage good governance and transparency”.

Mr Zoellick will also have to get to grips very quickly with a roughly $30bn (£15bn, €22bn) fund­raising drive by the bank and establish a near-term agenda in time for its annual meeting in October. Yet the incoming chief sees these demands as reinforcing the need to move forward on strategy development, building on work by François Bourguignon, the bank’s chief economist.

Mr Zoellick is careful not to set out publicly his initial thinking on the bank’s future, for fear it would be mistaken for an agenda he intends to foist on the bank. Instead, he talks about the need for the bank to adapt. “We are now in a much more networked world. We have got much better regional banks, vertical funds, private foundations, the private sector and non-governmental organisations,” he says. “We have to see how we can work more effectively together.”

Mr Zoellick is keen to bring to bear lessons from his most recent job as a Goldman Sachs investment banker. “You will hear me talk a lot about client focus and working in partnership,” he says. “I also want to connect the asset and liability side of the balance sheet” – using expertise and possibly even the bank’s own balance sheet to develop innovative financial products. This could require changes to bank rules.

On the bank’s multiple roles, Mr Zoellick says: “I think in terms of a portfolio of complementary investments.” He is sceptical of those who argue that it should focus narrowly in an interconnected world. “There are no magic silver bullets – the world is too complicated.”

Beyond that Mr Zoellick is unwilling to go, except to say he hopes to “plant seeds” and allow the debate on the bank’s strategy to grow. However, his conversations with development experts – three of whom have also spoken to the FT – suggest that his early queries revolve around six subject areas.

First, a focus on the poorest countries, particularly in Africa, left behind by the globalisation of trade and private capital flows. Here Mr Zoellick sees the importance of the IDA, the bank’s concessional lending arm. He seems keen the bank should continue its work on social sectors, seeking to help, for instance, countries ravaged by HIV/Aids. But he has also floated a renewed emphasis on infrastructure and growth, with particular focus on regional integration and mobilising African savings through financial sector reform.

Second, work in middle-income and emerging economies, with the bank continuing to lend even to countries such as China that have access to private capital, but contributing most through its know-how in helping to build the infrastructure of a modern economy. Mr Zoellick appears hopeful that by helping address their needs, the bank will be able to build partnerships in third countries, for instance with China in Africa.

Third, a larger role in fragile and post-conflict states – an idea lately pushed by Mr Wolfowitz. This would require the bank to develop a rapid response capability. However, Mr Zoellick has said he is aware this raises difficult questions about how to ensure security for bank staff.

Fourth, a role in providing public goods, which prominently includes climate change but also combating disease or even supporting a trade round with aid for capacity building.

Fifth, Mr Zoellick has told people he is interested in exploring how the bank could better support modernisers in the Arab and Muslim world. Some of the people he has spoken to see this as potentially controversial. However, Mr Zoellick stresses that he envisages the bank working in partnership with local entities and funds, taking the modernisation of Asia as his model.

Finally, he has stressed the bank’s role as a learning institution. He has indicated that finding a world-class chief economist to succeed Mr Bourguignon when he leaves this year is a priority.

James Wolfensohn, Mr Zoellick’s predecessor but one, says the new bank president will be able to champion a more unifying form of globalisation in a world divided into rich nations, fast-growing emerging nations, slow-growth economies and stagnant ones. The challenge is to “convince the rich countries that nobody is safe if you have one or two billion people who are now informed with radios and cellphones but have nothing”.

Mr Zoellick may be already thinking along these lines. In accepting the job, he said the bank should lead the way in developing what he called “sustainable globalisation”.

UPBEAT WORDS FROM WOLFOWITZ AT THE DOOR

Paul Wolfowitz’s unprecedented departure – in good health, midway through a five-year term – is for his many critics at the World Bank a fitting end to a tenure they say was marked by his disdain for bank rules and practices, confrontation with the board and disregard for the views of career staff with long practical experience of development. Krishna Guha and Eoin Callan report from Washington.

Yet Mr Wolfowitz challenges the notion that his presidency has ended in failure – or that it was ever truly dominated by controversies and conflict.

“I feel quite good,” he tells the Financial Times. “I certainly believe strongly in the mission. I think the kind of work we have done in Africa is extremely important. I hope to see it well funded by big donors including the Europeans and the US.”

In an interview, he cites figures showing that the bank’s lending to poor countries reached a record in the financial year that ends tomorrow. “We are up 20 per cent in Africa year on year,” he says. “This is in spite of what people say is an excessive – I disagree strongly with the adjective excessive – focus on governance.” He adds that some of the money was disbursed in “innovative ways, through rapid response in post-conflict countries like Liberia and Congo.”

People familiar with the bank’s finances caution against reading too much into one year’s numbers, given the long lead time on bank projects and its three year funding cycle. But Mr Wolfowitz sees the figures as evidence that the bank did good work under his leadership. “If you listen to some of my critics you would think everything stopped,” he says. “I frankly think it is bogus when people talk about management problems and leadership problems. Anyway, we are where we are.”

Mr Wolfowitz does not discuss the immediate cause of his departure: the uproar over his role in directing the bank’s human resources chief to agree a pay-and-promotion secondment package for Shaha Riza, his girlfriend, that went far beyond the recommendations of the board’s ethics panel. An investigation by a panel of board members found his actions violated three staff rules, the bank’s code of conduct and terms of his own contract.

Mr Wolfowitz has consistently maintained that he acted ethically throughout and, in return for his agreement to step down, won a statement from the board that it accepted that assurance.

The overwhelming view inside the bank is that justice will be done with his departure. “I am not one of the ones drinking champagne but I think it was the right outcome,” says one vice-president. Many bank staffers see his handling of the Riza secondment as only one example of what they say was a lack of respect for bank rules, norms and procedures.

Mr Wolfowitz says this is a “complete misrepresentation”. He says “there were no rules and procedures for when a country like Chad breaks an agreement with the bank,” citing an example. “What surprised people was that we took some action.”

Many of his colleagues take issue with the claim that Mr Wolfowitz followed the bank’s established processes. “He constantly made a mess by not respecting the rules – even when he made substantially sensible decisions,” says a senior official who, like others interviewed by the FT, spoke on condition of anonymity because he was not authorised to speak to the press.

Two officials give the example of an early clash between Mr Wolfowitz and the board over debt relief for Congo-Brazzaville. A board director says Mr Wolfowitz tried unilaterally to alter the terms under which it would qualify for debt relief under the Highly Indebted Poor Countries (HIPC) programme after seeing reports of corruption – including a newspaper exposé of President Denis Sassou-Nguesso’s hotel bills in New York.

When 22 of the 24 board members objected, and proposed emphasising safeguards instead, Mr Wolfowitz tried to shut down debate, the board member says. “It was the first famous punch-up.” Mr Wolfowitz was right about the government being corrupt, he adds, but the bank had to deal with this in a way that was in keeping with its own rules. “It was a classic case of willing the ends but not willing the means.”

Mr Wolfowitz says that “we had some difficult issues over HIPC for Congo-Brazzaville” but characterises the exchange differently. “Both sides stated their positions and I think we came up with a middle ground,” he says.

Four board directors told the FT that Mr Wolfowitz in general did not consult adequately before making important decisions. “I think that is very unfair,” he responds. “I spent a great deal of time with the board. I listened to the board. I changed lots of things in response to their concerns.” But he acknowledges: “I didn’t always do what they wanted. They didn’t always do what I wanted.”

Directors say they often struggled to understand why Mr Wolfowitz was singling out countries or projects for action on corruption. “It was the unpredictability – arbitrariness is a bit too harsh – but he would be very tough on Kenya and not as tough on Ethiopia,” a senior bank official says. Mr Wolfowitz says the Ethiopia agreement included “a very innovative protection of basic services programme”.

The board repeatedly demanded amendments to proposed governance policy to clarify the principles to guide anti-corruption work. Staff drafted changes only to find these rewritten in the president’s office.

Mr Wolfowitz appeared astonished when his plan was rejected by the world’s finance and development ministers at the bank’s annual meeting in Singapore, an unprecedented rebuke for a bank president. After that the bank conducted a global consultation before arriving at a compromise strategy the board could accept. Mr Wolfowitz says “we came up with I think something that really takes this whole strategy to a higher level.”

Many bank insiders claim that Mr Wolfowitz’s misadventures stemmed from his reliance on a close circle of like-minded aides with little knowledge of development. “The first thing he did was to isolate himself from the bureaucracy by bringing in three or four Americans who surrounded him – including Robin Cleveland, who operated as a chief operating officer,” a former senior bank official says.

A serving senior official says Mr Wolfowitz’s inner circle did not trust career executives to make decisions. There was “a confidence in their view of the world, a confidence there that is unshakeable almost to the exclusion of facts”. Anyone who raised reservations, for example about the anti-corruption drive, was considered suspect, he adds. “There was a sense that these guys, because they are not on my side, are the enemy.”

At times in the last few months, as Mr Wolfowitz was battling to save his job, he said he should have reached out to senior career managers earlier. But he now says: “I do not think it would have made any difference to this result anyway. There were other forces at work.”

Mr Wolfowitz declines to specify what these forces were. His supporters believe he was the victim of a power grab by European leaders, some of whom were taking belated revenge for his role in the Iraq war as US deputy defence secretary.

The concentration of power in the hands of a few aides with ties to the Bush administration fostered a suspicion that Mr Wolfowitz made some decisions in the US interest. But the evidence is not clear-cut. “I think he is innocent,” says an otherwise critical bank vice-president, arguing that secrecy and ad hoc process created the impression of conspiracy when none existed.

In general Mr Wolfowitz does not appear to have favoured US policy. But in the Middle East many bank staff believe he did. A former official says: “I determined a clear line in support of what came out of the Bush administration. I’m absolutely convinced that was the case.”

The election victory of Hamas in the Palestinian territories last year was one flashpoint. Current and former officials say Mr Wolfowitz sought to suppress or at least delay a report that found a dramatic increase in poverty and disease as international aid slowed to a trickle.

“I got a phone call to say the president was extremely displeased,” says a person involved. Christiaan Poortman, the regional vice-president, who was later removed from his post by Mr Wolfowitz, was called into Ms Cleveland’s office and rebuked.

Mr Wolfowitz denies there were divisions. “I know of no significant differences on the West Bank/Gaza,” he says. But officials say Mr Wolfowitz clashed again with the Middle East team over his ambition to open an office in Baghdad, which managers feared would put staff in harm’s way. Emotions were heightened after an Iraqi staff member was shot. Mr Wolfowitz “refused to accept that the situation in Iraq was spinning out of control”, a senior manager says. “He was in denial.”

In the final days of his presidency, a country manager was appointed to “manage the bank’s office and resident staff in Iraq”, according to bank documents.

Mr Wolfowitz says he focused on Iraq only after Britain’s Hilary Benn (international development minister until his promotion yesterday) complained about the slow disbursement of money from a multi-donor fund. “People love to make an issue about Iraq, because it is a four-letter word, I guess. But the fact is it has not been a major subject of attention or controversy,” he says, adding that the bank played a much bigger role in Lebanon.

For his critics, Mr Wolfowitz’s woes stemmed from failure to use the cumbersome processes of a multilateral institution to build broad support for his initiatives. “It is not just that he did not respect the multilateral process. He did not understand the power of the multilateral process” to support or harm his ambitions, a board director says.

Outside the bank, some see parallels between Mr Wolfowitz’s tenure there and at the Pentagon, where he brought in civilians to challenge what he saw as undue caution by career military staff. “There is a Praetorian guard approach to institutions, which can often prove totally self-defeating, as it did at the World Bank,” says a former administration official.

Bruce Fein, who was in the Reagan administration, says: “The attitude is that if there’s a rule that you don’t like or which slows things down, then get rid of the rule.” He sees a “common neo-conservative thread that consistently underestimates how difficult it is to transform other societies . . . That applies whether you are talking about delivering democracy to Iraq or eliminating corruption in India or sub-Saharan Africa.”

Another academic points to a further link between the Wolfowitz approach to Iraq and the World Bank. “The traditional objection to ignoring normal rules and processes is that you then alienate key stakeholders,” he says. “But Paul has this view that the absolute rightness of what he is doing will ultimately win all of these stakeholders around to his side when they see how wrong they were all along.”

Yet his supporters think he has been unfairly pilloried for challenging the status quo at the bank. “That place needs a kick up the ass,” says a former Bush administration official.

Adam Lerrick of the American Enterprise Institute, a conservative think-tank that Mr Wolfowitz will now join, says: “What you are dealing with is an organisation of nearly 20,000 people who are resistant to change . . . If you abide by the rules, engage with staff, work with the board, nothing is going to change.”

The bank chief says he steps down encouraged by what he sees in Africa. “I came here very conscious of the needs of Africa. I leave here with a great deal of hope of progress in Africa.”

Additional reporting by Edward Luce and Hugh Williamson