Federal Treasurer Wayne Swan says the International Monetary Fund's (IMF) legitimacy will continue to be undermined if it appoints a successor to Dominique Strauss-Kahn on the basis of nationality.
The hunt is on for a new IMF managing director after Strauss-Kahn resigned to fight sexual assault charges in New York.
Mr Swan on Sunday said he'd long believed emerging and developing countries needed to be better represented on the IMF.
"It's important the selection of a replacement be open and transparent," the treasurer said in an economic note.
"The tradition of automatically appointing a European to the role is one that's long past its use-by date given the shift of global economic weight to emerging economies, particularly in Asia, over the past few decades."
Mr Swan, in a joint statement with South Africa's Finance Minister Pravin Gordhan, said the appointment of Strauss-Kahn's successor must be based on merit.
"For too long, the IMF's legitimacy has been undermined by a convention to appoint its senior management on the basis of their nationality," their statement said.
"In order to maintain trust, credibility and legitimacy in the eyes of its stakeholders, there must be an open and transparent selection process which results in the most competent person being appointed as managing director, regardless of their nationality."
Australia and South Africa are co-chairs of the G20 IMF Reform Working Group.
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