Governance is the overall complex system or framework of processes, functions, structures, rules, laws and norms born out of the relationships, interactions, power dynamics and communication within an organized group of individuals.
It sets the boundaries of acceptable conduct and practices of different actors of the group and controls their decision-making processes through the creation and enforcement of rules and guidelines.
Furthermore, it also manages, allocates and mobilizes relevant resources and capacities of different members and sets the overall direction of the group in order to effectively address its specific collective needs, problems and challenges.
Such governance guides the formulation, implementation, and evaluation of the group's objectives, policies, and programs, ensuring smooth operation in various contexts.
It fosters trust by promoting transparency, responsibility, and accountability, and employs mechanisms to resolve disputes and conflicts for greater harmony.
By delivering on its promises and creating positive outcomes, it fosters legitimacy and acceptance of the governing body, leading to rule-compliance, shared responsibility, active cooperation, and ultimately, greater stability and long-term sustainability.
[9] The first usage in connection with institutional structures (as distinct from individual rule) appears in Charles Plummer's The Governance of England (an 1885 translation from a 15th-century Latin manuscript by John Fortescue, also known as The Difference between an Absolute and a Limited Monarchy).
In its most abstract sense, governance is a theoretical concept referring to the actions and processes by which stable practices and organizations arise and persist.
[citation needed] In general terms, public governance occurs in various ways: Private governance occurs when non-governmental entities, including private organizations, dispute resolution organizations, or other third party groups, make rules and/or standards which have a binding effect on the "quality of life and opportunities of the larger public."
[20] The number of actors (whether they be states, non-governmental organizations, firms, and epistemic communities) who are involved in governance relationships has also increased substantially.
Public trust and accountability is an essential aspect of organizational viability so it achieves the social mission in a way that is respected by those whom the organization serves and the society in which it is located.
Its role is to provide a repeatable and robust system through which an organization can manage its capital investments—project governance handles tasks such as outlining the relationships between all groups involved and describing the flow of information to all stakeholders.
Without recognized property rights, it is hard for small entrepreneurs, farmers included, to obtain credit or sell their business[29] – hence the relevance of comprehensive land governance.
For instance, it has been argued that what is frequently called 'land grabbing', was partly made possible by the Washington Consensus-inspired liberalization of land markets in developing countries.
Generally, landscape governance could be described asboth an empirical observation and a normative idea based on the principles of place-based multi-stakeholder dialogue, negotiation and spatial decision-making, and aims to achieve environmental, economic and social objectives simultaneously.
[38] It is also important to consider that people have witnessed a global shift from traditional and reactive healthcare to proactive care, mainly enabled by investment in advanced technologies.
Recent artificial Intelligence (AI) and Machine learning have made possible the automation as well as the standardisation of many processes in healthcare, which have also brought to light challenges to the existing governance structures.
The main technical features of blockchains support transparency and traceability of records, information immutability and reliability, and autonomous enforcement of agreements.
Regulatory governance reflects the emergence of decentered and mutually adaptive policy regimes which rests on regulation rather than service provision or taxing and spending.
[48] The mechanism of participatory governance links the social sphere to the political to produce policies directly molded by or influenced by citizens.
In the case of a business or of a non-profit organization, for example, good governance relates to consistent management, cohesive policies, guidance, processes and decision-rights for a given area of responsibility, and proper oversight and accountability.
"Good governance" implies that mechanisms function in a way that allows the executives (the "agents") to respect the rights and interests of the stakeholders (the "principals"), in a spirit of democracy.
The World Bank defines governance as: the manner in which power is exercised in the management of a country's economic and social resources for development.
An alternate definition sees governance as: the use of institutions, structures of authority and even collaboration to allocate resources and coordinate or control activity in society or the economy.
Nevertheless, governments in a rapidly changing environment need to be able to adapt quickly, so being bounded by rigid structures of functioning could work as a detriment.
Since the conceptualization of effective governance is not onefold, some more components that might constitute it are suggested: “It should be small in extent with limited intervention in the economy; a clear vision and processes; committed quality personnel that can formulate and implement policies and projects; comprehensive participation with the public; efficient financial management; responsive, transparent and decentralized structures and political stability”.
[70] As is the case with economic development, it is plausible the argue that effective governance and the named predictors are a positive feedback cycle: they reinforce each other, and so indirectly themselves.
[71] Zartman describes how absence of effective governance comes about: “as the disintegration ofstate structure, authority (legitimate power), law, and political order”.
[72] Five main characteristics are to be differentiated in the absence of effective governance: disorganizing of the structure of the processes in the state, violent conflicts, violations of human rights and social fragmentation, all of which have an endogenous character.
To measure the overall commitment to transparency, the IBP created Open Budget Index (OBI), which assigns a score to each country based on the results of the survey.