Governance Basics

What is Governance? :
Getting to a definition

The complexity of governance is difficult to capture in a simple definition.

The need for governance exists anytime a group of people come together to accomplish an end. Most agree that the central component of governance is decision-making. It is the process through which this group of people make decisions that direct their collective efforts. see Fig.1

If the group is too large to efficiently make all necessary decisions, it creates an entity to facilitate the process. Group members delegate a large portion of the decision-making responsibility to this entity. In voluntary sector organizations this entity is the board of directors. One simple definition of governance is "the art of steering societies and organizations." Governance is about the more strategic aspects of steering, making the larger decisions about both direction and roles.

Some observers criticize this definition as being too simple. Steering suggests that governance is a straightforward process, akin to a steersman in a boat. These critics assert that governance is neither simple nor neat — by nature it may be messy, tentative, unpredictable and fluid. Governance is complicated by the fact that it involves multiple actors, not a single helmsman.

These multiple actors are the organization's stakeholders. see Fig.2 They articulate their interests, influence how decisions are made, who the decision-makers are and what decisions are taken.

Decision-makers must absorb this input into the decision-making process. Decision-makers are then accountable to those same stakeholders for the organization's output and the process of producing it. see Fig.3