Concept of Governance
Governance has been
defined to refer to structures and processes that are designed to ensure
accountability, transparency, responsiveness, rule of law, stability, equity
and inclusiveness, empowerment, and broad-based participation.
It is the
processes of interaction and decision-making among the actors
involved in a collective problem that leads to the creation, reinforcement, or
reproduction of social
norms and institutions.
Governance also
represents the norms, values, and rules of the game through which public affairs
are managed in a manner that is transparent, participatory, inclusive and
responsive.
Governance
is the way that organizations or countries are managed at
the highest level, and the systems for doing this.
Governance therefore
can be subtle and may not be easily observable.
In a broad sense,
governance is about the culture and institutional environment in which citizens
and stakeholders interact among themselves and participate in public affairs.
It is more than the
organs of the government.
International
agencies such as UNDP, the World Bank, the OECD Development Assistance
Committee (DAC) and others define governance as the exercise of authority or
power in order to manage a country’s economic, political and administrative
affairs.
2009 Global
Monitoring Report shows governance as ‘power relationships,’ ‘formal and
informal processes of formulating policies and allocating resources,’
‘processes of decision-making’ and ‘mechanisms for holding governments
accountable.’
Often there is a
tendency to equate governance with management, the latter primarily referring
to the planning, implementation, and monitoring functions in order to achieve
pre-defined results.
Management
encompasses processes, structures, and arrangements that are designed to
mobilize and transform the available physical, human and financial resources to
achieve concrete outcomes. Management refers to individuals or groups of people
who are given the authority to achieve the desired results.
Governance systems
set the parameters under which management and administrative systems will
operate. Governance is about how power is distributed and shared, how policies
are formulated, priorities set and stakeholders made accountable.
A variety of entities (known generically as governing bodies) can govern. The most formal is a government, a body whose sole responsibility and authority are to make binding decisions in a given geopolitical system (such as a state) by establishing laws. Other types of governing include an organization (such as a corporation recognized as a legal entity by a government), a socio-political group (chiefdom, tribe, gang, family, religious denomination, etc.), or another, an informal group of people. In business and outsourcing relationships, Governance Frameworks are built into relational contracts that foster long-term collaboration and innovation.
Table below
summarizes the difference between governance and management:
|
Governance |
Management |
|
- Set and norms, strategic vision and
direction and formulate high-level goals and policies |
- Run the organization in line with
the broad goals and direction set by the governing body |
|
- Oversee management and
organizational performance to ensure that the organization is working in the
best interests of the public, and more specifically the stakeholders who are
served by the organization’s mission |
- Implement the decisions within the
context of the mission and strategic vision - Make operational decisions and
policies, keep the governance bodies informed and educated |
|
- Direct and oversee the management
to ensure that the organization is achieving the desired outcomes and to
ensure that the organization is acting prudently, ethically, and legally |
- Be responsive to requests for
additional information |
In the development
literature, the term ‘good governance is frequently used. In particular, the
donors promote the notion of ‘good governance as a necessary pre-condition for
creating an enabling environment for poverty reduction and sustainable human development.
Good governance has also been accepted as one of the targets of the Millennium
Development Goals (MDGs). The good governance agenda stems from the donor's
concern with the effectiveness of the development efforts. Good governance is
expected to be participatory, transparent, accountable, effective, and equitable
and promotes rule of law.