Good governance is an indeterminate term used in development literature to describe how public institutions conduct public affairs and manage public resources in order to guarantee the realization of human rights. Governance describes "the process of decision-making and the process by which decisions are implemented (or not implemented)". The term governance can apply to corporate, international, national, local governance or to the interactions between other sectors of society.
The concept of "good governance" often emerges as a model to compare ineffective economies or political bodies with viable economies and political bodies. Because the most "successful" governments in the contemporary world are liberal democratic states concentrated in Europe and the Americas, those countries' institutions often set the standards by which to compare other states' institutions. Because the term good governance can be focused on any one form of governance, aid organizations and the authorities of developed countries often will focus the meaning of good governance to a set of requirement that conform to the organizations agenda, making "good governance" imply many different things in many different contexts.
- between governments and markets,
- between governments and citizens,
- between governments and the private or voluntary sector,
- between elected officials and appointed officials,
- between local institutions and urban and rural dwellers,
- between legislature and executive branches, and
- between nation states and institutions.
The varying types of comparisons comprising the analysis of governance in scholastic and practical discussion can cause the meaning of "good governance" to vary greatly from practitioner to practitioner.
Reform and standards
Three institutions can be reformed to promote good governance: the state, the private sector and civil society. However, amongst various cultures, the need and demand for reform can vary depending on the priorities of that country's society. A variety of country level initiatives and international movements put emphasis on various types of governance reform. Each movement for reform establishes criteria for what they consider good governance based on their own needs and agendas. The following are examples of good governance standards for prominent organizations in the international community.
The International Monetary Fund declared in 1996 that "promoting good governance in all its aspects, including by ensuring the rule of law, improving the efficiency and accountability of the public sector, and tackling corruption, as essential elements of a framework within which economies can prosper." The IMF feels that corruption within economies is caused by the ineffective governance of the economy, either too much regulation or too little regulation. To receive loans from the IMF, countries must have certain good governance policies, as determined by the IMF, in place.
- Consensus Oriented
- following the Rule of Law
- Effective and Efficient
- Equitable and Inclusive
The World Bank is more concerned with the reform of economic and social resource control. In 1992, it underlined three aspects of society which they feel affect the nature of a country's governance:
- type of political regime;
- process by which authority is exercised in the management of the economic and social resources, with a view to development; and
- capacity of governments to formulate policies and have them effectively implemented.
International humanitarian funding
Good governance defines an ideal which is difficult to achieve in full, though it is something development supporters consider donating to causes. Major donors and international financial institutions, like the IMF or World Bank, are basing their aid and loans on the condition that the recipient undertake reforms ensuring good governance . This is mostly due to the close link between poor governance and corruption.
Because concepts such as civil society, decentralisation, peaceful conflict management and accountability are often used when defining the concept of good governance, the definition of good governance promotes many ideas that closely align with effective democratic governance. Not surprisingly, emphasis on good governance can sometimes be equated with promoting democratic government.
A good example of this close association, for some actors, between western democratic governence and the concept of good governance is the following statement made by Hillary Clinton in Nigeria on August 12, 2009:
Again, to refer to President Obama’s speech, what Africa needs is not more strong men, it needs more strong democratic institutions that will stand the test of time. (Applause.) Without good governance, no amount of oil or no amount of aid, no amount of effort can guarantee Nigeria’s success. But with good governance, nothing can stop Nigeria. It’s the same message that I have carried in all of my meetings, including my meeting this afternoon with your president. The United States supports the seven-point agenda for reform that was outlined by President Yar'Adua. We believe that delivering on roads and on electricity and on education and all the other points of that agenda will demonstrate the kind of concrete progress that the people of Nigeria are waiting for.
In the book, "Contesting 'good' governance" Eva Poluha and Mona Rosendahl contest standards that are common to western democracy as measures of "goodness" in government.. After applying political anthopological methods, they feel that governments believe they apply the concepts of good governance when executing their activities, however, cultural differences result in conflict with the standards of the international community.