Good Governance

The phrase came into wide use through development agencies and international bodies, which found that aid and reform worked poorly where institutions were weak or corrupt. Lists of its features differ in wording but commonly include accountability, transparency, participation, rule of law, responsiveness, fairness and effective use of resources. The United Nations, the World Bank and the OECD each have their own formulations, so the term has no single official definition. It is applied to governments, regulators, public companies, universities and charities alike, and many corporate governance codes draw on the same ideas. In practice it is assessed through indicators such as public audit results, procurement transparency, public access to information and measures of corruption. Critics note that the term can be vague, and that what counts as good varies with context. Lenders, donors, investors and citizens use it to judge whether an institution can be trusted with money and power.

A national road agency publishes its budget, awards contracts through open tender with published results, and holds public consultations before choosing routes. An independent audit office reviews its accounts, and citizens can file complaints. A development lender cites these practices as reasons for approving a funding request.