The design of decision-making mechanisms in international organizations carries profound significance and therefore requires prudence and meticulousness. Photo: TUCHONG

Voting is the primary mechanism for formal decision-making in international organizations. Generally speaking, the more important and sensitive the issue, the more likely voting will be employed. The voting-based decision-making mechanism consists of two key components: the distribution of voting rights and the design of decision-making (voting) rules. The distribution of voting rights refers to how many votes are distributed to each member, and the design of decision-making (voting) rules usually refers to the percentage of affirmative votes required to pass a motion.

Voting mechanisms

One perspective holds that the importance of voting in international organizations is often overstated, as many decisions are made without resorting to a formal vote. While it is true that in many cases a vote is not cast in an international organization, the importance of how voting rights are distributed or how voting rules are designed cannot be neglected. When there is a clear consensus or near-universal agreement on a motion, the need for a formal voting process may be bypassed. For example, in the UN General Assembly, if no member state explicitly opposes a proposal or calls for a vote, the motion can pass without one.

Another example can be seen in the European Economic Community (EEC) between 1958 and 1972. The six founding member states had votes distributed as follows: France, Germany, and Italy each held four votes, Belgium and the Netherlands had two votes each, and Luxembourg was given just one vote. The voting rules required a two-thirds majority of the total 17 votes—12 votes—for a proposal to pass. As Luxembourg only held one vote, it was effectively sidelined, since its vote was insufficient to influence the outcome. When member states lobbied for support on proposals, Luxembourg was often ignored. Even if Luxembourg did not cast a vote, each member state clearly understood the distribution of votes and how many were required to approve a motion. Hence, there was no practical need for Luxembourg to continually vote.

Another example involves the United States’ veto power in the World Bank (mainly the International Bank for Reconstruction and Development, IBRD) and the International Monetary Fund (IMF). While the US holds veto power, it has never actually exercised this authority. The representatives of member states in the World Bank and the IMF are predominantly economic professionals, and the issues they discuss are mainly economic and financial in nature. They are generally rational and will not spend great effort on preparing proposals unlikely to gain US support, let alone bringing them to a vote. This situation contrasts sharply with the dynamics of the UN Security Council, where the topics often touch on sensitive matters of state sovereignty or national sentiment. In the UN, a member state may still propose a resolution and bring it to a vote—even knowing it might be vetoed by a permanent member—simply to assert its stance and make its position clear.

Although the US has never really exercised its veto power in the World Bank or the IMF, this does not suggest that it undervalues this authority. On the contrary, the US even went so far as to modify decision-making rules to preserve its veto power.

The US’ veto in the World Bank and the IMF functions similarly to its veto in the UN Security Council, but the legal frameworks differ. The UN Charter explicitly grants veto power to the five permanent members of the UN Security Council, including the United States. In contrast, the IBRD and IMF Articles of Agreement do not explicitly grant the US veto power. However, key decisions in both organizations require a supermajority of 85% approval. Since the US controls more than 15% of the voting shares, it holds a de facto veto power. Previously, amending the IBRD Articles of Agreement required only 80% of votes, but at that time, the US held over 20% of the voting power. As the US’ share was diluted to below 20% due to factors such as the admission of new members, the US then pushed for a change to raise the approval threshold to 85%, thereby securing its veto.

Distribution of voting rights

The design of decision-making mechanisms in international organizations must address both the distribution of voting rights and the structure of decision-making rules. There are primarily two models for distributing voting rights. One is the “one country, one vote” system, while the other is a system where one country holds multiple votes. International political organizations, such as the UN, typically follow the “one country, one vote” model. International economic organizations like the World Bank, the IMF, and the Asian Infrastructure Investment Bank (AIIB) adopt a multi-vote system. Here, the number of votes allocated to each country is largely determined by the amount of shares they hold.

The European Union (EU) also follows a “one country, multiple votes” mechanism. Its primary legislative rule is based on a qualified majority, which is reached when 55% of the European Council’s members, comprising at least 65% of the EU population, support a proposal. This system embodies the principle of double majority voting. The 55% threshold reflects a “one country, one vote” approach, while the 65% threshold aligns with the “one person, one vote” principle. The design of this double majority voting mainly aims to balance the rights and interests of both large and small member states. Naturally, larger states like Germany and France favor the “one person, one vote” system, while smaller states such as Malta and Cyprus prefer the “one country, one vote” approach. The EU’s voting system has significantly contributed to minimizing conflicts over the distribution of voting rights among member states.

Design of decision-making rules

The design of decision-making rules in international organizations generally falls into two main categories: unanimous approval and majority rule. Unanimous approval requires all members to agree or, at the very least, for no member to explicitly oppose a decision. Majority rule, on the other hand, dictates that the minority must follow the decision of the majority. The League of Nations was a typical example of unanimous approval, which effectively granted each member veto power. However, this approach was criticized for its inefficiency and inability to effectively resolve international disputes. In contrast, the UN strictly limits unanimous approval and veto power to five permanent members of its Security Council, meaning only these major countries must reach consensus. Today, most international organizations, particularly economic ones like the World Bank, IMF, AIIB, and the New Development Bank established by BRICS countries, have implemented majority rule. These organizations use a variety of decision-making frameworks depending on the issues at hand, combining a simple majority with double majority, and requiring different proportions of affirmative votes. As a result, their decision-making systems tend to be rather complex.

The decision-making rules of “old” multilateral development banks (MDBs) like the World Bank are notably more complex and sophisticated. Different decision-making rules are adopted for core issues, such as amending articles of agreement, electing the president, and increasing shares, making them appear almost customized. In comparison, the decision-making rules of “emerging” MDBs, such as the New Development Bank, are simpler and more uniform, applying a single decision-making rule across all these core issues. According to the theory of voting power that distinguishes between voting rights and voting power—where voting rights refer to the number and weight of votes a member can cast, and voting power refers to a member’s ability to influence the outcome by exercising its voting rights—the distribution of voting power can vary greatly depending on the decision-making rules, even if the distribution of voting rights remains unchanged.

An example of this is the World Bank. An amendment to its articles of agreement requires 85% approval, giving the US veto power since it holds more than 15% of the voting rights. However, the election of the World Bank’s president only requires 50% of affirmative votes, thus the US does not seem to have veto power. Nonetheless, if the US and European countries, which collectively hold around 50% of the voting rights, align, the US not only retains veto power but also gains “pass power” in the election process, effectively determining the outcome. If the election of the World Bank’s president also required 85% of votes, the US would have veto power but not the ability to unilaterally pass a candidate. The US could block a candidate but couldn’t ensure their selection. This makes “pass power” more significant in elections of the president. As an established power in shaping the system and holding the sole veto, the US is invested in maintaining the status quo. By designing varied decision-making rules, the US can easily concentrate power on issues critical to its interests while dispersing it in other areas to present the two Bretton Woods institutions—the World Bank and the IMF—as more “democratic.”

In general, the design of decision-making mechanisms in international organizations, including both the distribution of voting rights and the design of decision-making rules, carries profound significance and therefore requires prudence and meticulousness. For decades, the global economic governance system, shaped by the Bretton Woods institutions, has been largely developed and controlled by developed countries in Europe and the US, with China playing a participatory and adaptive role. However, as China’s composite national strength and international status grow, there is a need to develop new theoretical frameworks for international organizations, supported by mathematics, computational science, and decision science, in addition to mainstream disciplines such as international relations and international law. Only by doing so can we better respond to challenges and meet general expectations.

Luo Hang is a research fellow from the School of International Studies at Peking University.