Many scholars, aid donors, policymakers, as well as recipients of aid, contend that governance forms a crucial aspect of sustainable economic development. This growing realization has sparked the need to have an understanding of the concepts of governance, good governance, and good enough governance. An evaluation of the three concepts of provides an understanding of the relevant policy indicators of the concepts.
Governance refers to the rules expressed by rulers within a set of rules, which ought to be followed by those exercising the governance. The International Monetary Fund and World Bank consider governance as the efforts aimed at creating an enabling environment, as well as building capacities. According to these international organizations, governance requires renewal of the political structure of a country. As such, corruption should be addressed from the highest to the lowest level (Munshi 2004, p. 34). The World Bank and IMF contend that governance entails setting an outstanding example through such actions as encouraging public participation, strengthening transparency and accountability, and by nurturing a free press. The IMF and World Bank also hold that governance includes fostering non-governmental and grassroots organizations, which may include women’s groups, co-operatives, as well as associations.
According to the IMF and World Bank, governance encompasses the process of making decisions and the implementation of these decisions. Based on this, the analysis of governance focuses on the informal and formal actors who take part in the making and implementation of the decisions. Therefore, governance entails the involvement of the informal and formal structures in the process of making decisions and the implementation of the decisions made (Kampen 2011, p. 3). The World Bank and IMF hold that one of the actors involved in governance includes the government. Actors in governance may vary in accordance with the level of government being discussed.