What is Governance? The United Nations Development Programme (UNDP), 1997, defined governance as \u201cthe exercise of economic, political and administrative authority to manage a country\u2019s affairs at all levels. It comprises the mechanisms, processes and institutions, through which citizens and groups articulate their interests, exercise their legal rights, meet their obligations and mediate their differences.\u201d In 1993, the World Bank defined governance as the method through which power is exercised in the management of a country\u2019s political, economic and social resources for development. In simple words, Governance is the process and institutions through which decisions are made and authority in a country is exercised. Governance can be used in several contexts such as corporate governance, international governance, national governance and local governance. Thus governance focuses on the formal and informal actors and institutions involved in decision-making and implementing those decisions. Stakeholders of Governance Government is one of the key actors in governance. Other actors may include political actors and institutions, interest groups, civil society, media, non-governmental and transnational organizations. The other actors involved in governance vary depending on the level of government. Typically, the stakeholders of governance at national level can be categorised into three broad categories \u2013 State, Market and Civil Society. \tThe State includes the different organs of the government (Legislature, Judiciary and Executive) and their instrumentalities, independent accountability mechanisms etc. It also consists of different segments of actors (elected representatives, political executive, bureaucracy\/civil servants at different levels etc.) \tThe Market includes the private sector \u2013 organised as well as unorganised \u2013 that includes business firms ranging from large corporate houses to small scale industries\/ establishments. \tThe Civil Society is the most diverse and typically includes all groups not included in (a) or (b). It includes Non-Governmental Organizations (NGOs), Voluntary Organizations (VOs), media organisations\/ associations, trade unions, religious groups, pressure groups etc. Good Governance Governance by itself is a neutral term while 'Good Governance' implies positive attributes and values associated with the quality of governance. Good governance is a dynamic concept and there is much subjectivity involved in defining the aspects of good governance. United Nations Development Programme (UNDP) recognizes eight core characteristics of good governance: \tParticipatory \tConsensus oriented \tTransparent \tAccountable \tResponsive \tEffective and Efficient \tEquitable and Inclusive \tFollows the Rule of Law Understanding the key terms : Participation : \tParticipation of all section of society is cornerstone of good governance. \tParticipatory governance provides opportunities for citizens to take part in decision making, implementation and monitoring of government activities. \tHowever, participation needs to be informed and organized. This includes freedom of association and expression as well as an organized civil society. Consensus oriented \tGood governance requires mediation of the different interests in society to reach a broad consensus on \u25cfwhat is in the best interest of the whole community and \u25cfhow this can be achieved. \tIt also requires a broad and long-term perspective on what is needed for sustainable human development and how to achieve the goals of such development. Rule of Law \tGood governance requires fair legal frameworks that are enforced impartially. \tIt also requires full protection of human rights, particularly those of minorities and vulnerable sections of the society. \tAn independent judiciary and an impartial and incorruptible police force is sine qua non for impartial enforcement. Transparent \tTransparency means that decisions taken and their enforcement are done in a manner that follows rules and regulations. \tIt also means that information is freely available in easily understandable forms and directly accessible to those who will be affected by such decisions and their enforcement. \tIt also means that enough information is provided and that it is provided in easily understandable forms and media. \tFor example, in India the Right to Information (RTI) Act has been a powerful instrument in the hands of people to ensure transparency in the decision making process of executive. Accountable \tAccountability is the acknowledgment and assumption of responsibility for actions, products, decisions, and policies. \tThe components of accountability are answerability, sanction, redress and system improvement. \tIn general an organization or an institution is accountable to those who will be affected by its decisions or actions. \tAccountability cannot be enforced without transparency and the rule of law. Responsive \tGood governance requires that institutions and processes try to serve all stakeholders within a reasonable timeframe. \tRedressal of citizen grievance, citizen orientation, citizen friendliness and timely delivery of services are key component of responsive governance. Effective and Efficient \tGood governance means that processes and institutions produce results into the optimum use of resources at their disposal. \tThus it also covers the sustainable use of natural resources and the protection of the environment. Equitable and Inclusive \tA society\u2019s wellbeing depends on ensuring that all its members feel they have a stake in it and do not feel excluded from the mainstream of society. \tThis requires all groups, particularly the most vulnerable, have opportunities to improve or maintain their well-being. Many sources include \u201cStrategic Vision\u201d as a 9th principle of Good Governance. Strategic Vision: A broad and long-term perspective on good governance and human development is required. There is also an understanding of the historical, cultural and social complexities in which that perspective is grounded. Strategies for good governance \tReorienting priorities of the state through appropriate investment in human needs \tProvision of social safety nets for the poor and marginalized \tStrengthening state institutions \tIntroducing appropriate reforms in the functioning of Parliament and increasing its effectiveness \tEnhancing Civil Services capacity through appropriate reform measures that matches performance and accountability \tForging new alliances with civil society \tEvolving a new framework for government-business cooperation The Worldwide Governance Indicators project \u2013 World Bank As mention above, World Bank defines Governance as the process and institutions by which authority in a country is exercised. Specifically, governance is: \tthe process by which governments are selected, held accountable, monitored, and replaced; \tthe capacity of governments to manage resources efficiently, and to formulate, implement, and enforce sound policies and regulations; and \tthe respect of citizens and the state for the institutions that govern economic and social interactions among them \u2018The Worldwide Governance Indicators project\u2019 \u2013 By World Bank ranks more than 200 countries on six key indicators of governance. The six indicators are: \tVoice and Accountability \tPolitical Stability and Absence of Violence \tGovernment Effectiveness \tRegulatory Quality \tRule of Law \tControl of Corruption These aggregate indicators combine the views of a large number of enterprise, citizen and expert survey respondents in industrial and developing countries.