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Definition: governance from A Glossary of UK Government and Politics

A wider term than government, governance focuses not on formal governmental institutions, but on the whole range of governmental activities in each phase of the policy-making process, including the bargaining process between those representing government and the players involved in the private- and voluntary-sector bodies. Governance is about processes and systems by which we are governed. A government may be established to administer them.


Summary Article: Governance
from Encyclopedia of Political Theory

From the mid-1980s and onward, governance has become a catchword in discussions about how the economy, society, and different kinds of organizations are, or should be, governed. In August 2008, a Google search on governance gave more than 50 million hits, almost twice as many as globalization. The widespread reference to governance creates frequent translation problems, as many languages do not have a proper equivalent to the term. Because many people tend to stick to the English term, governance has itself become an instance of globalization.

Governance is one of the most fashionable terms within political science, and it is also widely used among practitioners. Part of the attraction is that governance signals a weakening of the state-centered view of power and societal steering, which has dominated the Western world for centuries but now seems to be problematized by contemporary empirical and ideological developments. Governance is a notoriously slippery term. Nevertheless, it aims to grasp the current movement away from the classical form of government through hierarchical command and bureaucratic rule and toward a more open and flexible type of governing based on the participation and interaction of a plethora of public and private actors in different kinds of networks, partnerships, and quasi-markets. These new forms of governance chime well with both the neoliberalist individualism and the postmodern decentering of society because they invoke the principle of “regulated self-regulation,” which permits individual and collective actors to work together to find joint solutions while maintaining a large degree of operational autonomy.

Governance is often used in conjunction with other terms. Hence, good governance refers to the recent endeavor of international organizations such as the United Nations and the World Bank to assess and measure the quality of the governing institutions and practices in terms of their stability, interaction, transparency, responsiveness, procedural fairness, effectiveness, and adherence to the rule of law. Global governance refers to attempts to develop regulatory policies in response to global problems in the absence of an overarching political authority. Corporate governance refers to the institutionalized interaction among many players—including shareholders, management, the board of directors, employees, customers, financial institutions, regulators, and the community at large—involved in the process of directing and controlling business firms. Project governance refers to the conditions, practices, and exercise of leadership that help to ensure that projects based on cooperation among several actors lead to innovative and yet feasible solutions. Multilevel governance refers to the rise of regional policy making and implementation structures such as the European Union, which link political authorities at different levels while, at the same time, involving relevant and affected actors from the private sector, thus leading to the formation of complex and tangled networks. Last but not least, it should be mentioned that public governance has become a buzzword in the consecutive waves of public-sector reforms that are inspired by the new public management doctrine, which aims to enhance the role of the market and introduce corporate management techniques in the public sector. The governance literature contains many other examples of the widespread use of the notion of governance, and there is no point in arguing about which of the many usages is the right one. We have to dig deeper and provide a generic definition of governance that can subsequently be used in radial categorizations of different kinds of governance.

Defining Governance

An initial look at the terminological genealogy reveals that governance has its distant roots in the Latin word gubernare, which means “to direct, rule, guide,” and the Greek word kybernan, which means “to steer or pilot a ship” and forms the basis of the notion of cybernetics. From the sixteenth century onward, the notion of government becomes a frequently used term in the English-speaking world. Government is derived from the French gouvernement, which in turn comes from the medieval French notion of gouvernance. Hence, we might conclude that governance is an old term for providing direction to society that went out of fashion a long time ago and only recently rose to its current fame.

Some contemporary commentators define governance in terms of either the formation of a collective will out of a diversity of interests (politics), a system of rules shaping the actions of social and political actors (polity), or a political steering of social and economic relations based on soft, cooperative policy instruments such as persuasion, voluntary coordination, or procedures for benchmarking of public performance (policy). A few definitions even attempt to combine all three elements in highly inclusive definitions of governance. However, none of these different definitions really captures the distinctiveness of governance, either because they fail to show what governance adds to the traditional notions of politics, polity, or policy or because they fail to put bounds on governance, which tends to include everything and nothing.

Governance is also sometimes defined as a general concept for any pattern of ordered rule including hierarchical government. Although this definition facilitates analysis of how different modes of governance, typically bureaucracies, markets, and networks, are combined in various countries and policy areas, it betrays the fundamental idea that governance implies a change in the role and nature of government. Alternatively, governance can be defined as the complex process through which a plurality of societal actors aims to formulate and achieve common objectives by mobilizing and deploying a diversity of ideas, rules, and resources. This definition emphasizes three distinctive features of governance. First, governance designates a process rather than a set of more or less formal institutions. Second, the process is driven by a collective ambition to define and pursue common objectives in the face of divergent interests. Third, the process is decentered in the sense that common objectives are formulated and achieved through the interaction of a plurality of actors from the state, the economy, and civil society.

Emphasizing the process element makes governance research akin to both policy analysis and implementation studies, which are also looking at processes. Hence, governance research aims to combine process-oriented analysis of policy input (policy analysis) with process-oriented analysis of policy output (implementation studies). Yet, at the same time, governance research aims to transcend the narrow focus on political and administrative processes taking place within the formal institutions of government. Highlighting the collective ambition to formulate and achieve common objectives is equally important as it takes us beyond the notion of concerted action, which fails to capture the shared ambition of the actors involved in governance to define and solve common problems through joint action. Finally, stressing the decentered character of governance makes it clear that governance cannot be reduced to steering, at least not in the traditional sense where steering refers to the government's exercise of sovereign power to achieve particular, pre-given goals. Defining governance as a decentered process through which policy is formulated, selected, and implemented tends to exclude the kind of unicentric, top-down government that is supposed to have existed prior to the new public management-inspired reforms that have swarmed the public sector from the mid-1980s and onward.

By contrast, governance can be said to include a variety of interactive policy processes. Some of these take the form of pluricentric networks, which aim to respond to complex, conflicting, and ill-defined policy problems by facilitating negotiated cooperation among relevant stakeholders on the basis of interdependency, trust, and self-regulated rules of the game. Others take the form of multi-centric quasi-markets, which aim to respond to problems associated with public monopolies by enhancing negotiated competition in public regulation and service delivery through the establishment of relational contracts between public authorities and private providers. Networks and quasi-markets seldom exist in pure forms, and combinations of the two basic forms of governance are frequent. Public-private partnerships, which combine elements of competition with elements of cooperation, are a case in point.

The state is, to an uneven but increasing extent, supplemented or supplanted by pluricentric networks and multicentric quasi-markets. However, this development does not necessarily result in a “hollowing out of the state,” as some commentators have suggested. Most public tasks are still undertaken by fairly traditional forms of bureaucratic government, and public authorities such as municipalities, regional governments, national ministries, supranational institutions, and international organizations also play an important role in facilitating and managing governance. However, the role of the state seems to vary across the different scales at which governance operates. Hence, whereas public agencies typically play a relatively large role in setting up and coordinating different forms of governance at the local, regional, and national scales, they tend to play a more limited role in relation to global governance and in relation to intra- and interorganizational forms of governance.

The Rise of Governance

The rise of governance, both as a discourse and a set of practices, can be traced back to the Trilateral Commission. In the mid-1970s, the commission initiated a worldwide discussion about “the overload of government” resulting from the mounting expectations of citizens and the limited capacities of public bureaucracies and about “the ungovernability of society” allegedly caused by the decline of public-spirited values. Neoliberal political parties and governments responded to the problem of government overload by recommending the privatization of public enterprises, contracting out of public services, and commercialization of the remaining public sector. In continuation with these neoliberal recommendations, new public management reforms sought to limit the role of elected government to the formulation of overall policy objectives and to place the delivery of public services in the hands of private contractors and quasi-autonomous public agencies operating on the basis of contracts and agreements with central government agencies. In response to the increasing ungovernability of society, new public management has aimed to integrate private organizations and firms in public governance through the formation of networks and partnerships and to enhance the exit and voice options for citizens in public-service delivery through enhanced consumer choice and the creation of user boards.

In political science, there has also been a growing concern for the crisis of the modern welfare state, and in the attempt to provide an alternative to state-sponsored welfare, public-choice theory has highlighted the allocative efficiency of the market. However, the research on steering and control conducted at the Max Planck Institute in Cologne and at the Center for Interdisciplinary Research in Bielefeld, Germany, has emphasized the limits of both hierarchies and markets. Hierarchies have problems dealing with societal complexity, and markets suffer from collective-action problems. The inherent problems of hierarchies and markets call for the development of new modes of governance based on negotiated interaction among interdependent policy actors. The viability of voluntary coordination beyond state and market is further supported by the work of the American political scientist Elinor Ostrom, who has demonstrated how common pool resources can be regulated through the development of durable cooperative institutions. In the early 1990s, Jan Kooiman summarized the new insights in the claim that no single actor, public or private, has the knowledge and capacity to solve complex, dynamic, and diversified problems. Kooiman and others among his Dutch political science colleagues saw the formulation of governance networks as the solution to this challenge, whereas other researchers saw contract-based partnerships between public and private actors as the way forward. The focus on governance networks resonated well with the works of a number of Anglo-Saxon scholars who had been criticizing the notions of corporatism and neocorporatism for their narrow focus on the tight cooperation among public authorities, trade unions, and business organisations and developed a more open and flexible notion of policy networks that were divided into tight and exclusive policy communities and loose and inclusive issue networks. The emphasis on network types of governance is extended further by international relations theorists, who have developed related notions of advocacy coalitions, epistemic communities, and multilevel governance. Finally, a mixed group of radicals and critical theorists perceive governance either as a neoliberal attempt to “roll back the state” or as the promise of a new democratic order based on associations in civil society that escape the systemic logics implicit to state and market. The latter interpretation turns governance into a prescriptive rather than descriptive concept and invokes the widely contested assumption that civil society is a power-free zone and, therefore, provides the ultimate source of emancipation.

Criticisms and Research Avenues

The research on governance, which sometimes gets carried away in an overly optimistic appraisal of the merits of the new forms of interactive governance, has been met by a series of objections that seem to correspond to the three phases of denial. First, there are those scholars who claim that governance hardly deserves scholarly attention as it remains a marginal phenomenon vis-à-vis the overwhelming predominance of public bureaucracy, which still performs most government functions in most states. The counterargument to this claim will be that governance is on the rise, already plays a significant role in some policy areas, and deserves attention because it blurs the distinction between the private and the public and transforms the role of the state.

Second, among those political science researchers who agree that public policy increasingly is produced and delivered through public-private interaction, many will deny that governance is new and refer to long-lasting traditions for involvement of private actors in the formulation, selection, and implementation of public policy. However, to this unobjectionable observation it should be added that, although governance is not in itself new, it is increasingly considered as an effective and legitimate way of governing society. Hence, what seems to be new is the central role governance is playing in the restructuring of the public sector and its boundaries.

The third and final form of denial is the claim that governance is a new but highly unfortunate phenomenon that should be countered by all means because it creates huge problems in terms of public accountability. While it is undeniably difficult to ensure accountability in pluricentric networks and multicentric quasi-markets, the conclusion is not necessarily that we should return to old-style hierarchical and bureaucratic rule. In our increasingly complex, fragmented, and multilayered societies, interactive forms of governance that bring together actors with different ideas and competences have come to stay. The task is, therefore, to develop new forms of accountability that transcend the traditional forms of electoral and bureaucratic accountability, which merely aim to hold administrators accountable to elected officials, who are in turn held accountable by the voters through regular elections.

The defense of governance research against the three objections raised above does not imply that governance research is a flawless endeavor without any serious problems. The theoretical underpinning of governance research is still relatively weak. There is also an urgent need for methods that combine quantitative and qualitative analysis in the study of governance. Furthermore, only a few empirical studies take us beyond single case studies. These problems bear witness to the fact that governance research has not yet been consolidated into a new political science paradigm. In addition, it should be noted that the new research on governance tends to have an insufficient understanding of the role of power and political conflict, needs to rethink important political science concepts such as sovereignty and democracy, and has been slow to develop tools for assessing the normative implications of governance. The future research agenda will also include: (a) analysis of the formation and transformation of governance arrangements, (b) studies of the situated (inter-)actions of different actors, and (c) reflections on the causes of governance failure and the possibility of meta-governing governance processes through a combination of institutional design, political and discursive framing, process management, and direct participation.

There is no unified theory of governance on which to build the future studies of governance; rather, a broad set of competing theoretical approaches seem to offer crucial insights into the formation, role, functioning, and management of governance. Principal-agency theory envisages the problems arising from incomplete or asymmetric information when a principal hires an agent to carry out a particular task; it can help to analyze the attempts to align the interests of public purchasers and private providers in quasi-markets. Systems theory focuses on communication within and among systems and subsystems and offers crucial insights into the need for intersystemic coordination in the face of fragmentation and complexity and into the various forms of higher order governance (meta-governance) that select, institutionalize, and govern actual governance processes in accordance with particular norms and values. Rational choice institutionalism examines how institutions shape the behavior of rational, self-interested actors by influencing their anticipation of the consequences of alterative courses of action; it is particularly useful in analyzing the game-like situations through which mutually dependent actors aim to enhance horizontal coordination. Normative institutionalism focuses on how the identity and conduct of social actors are shaped by rules, norms, and values that prescribe what is appropriate for the actors to do in particular situations. It emphasizes the dynamic development of identities, capacities, and political accounts through processes of normative integration and is helpful in analyzing the spread and adoption of new governance paradigms within the public sector. Interpretative policy analysis perceives social actors as interpreting subjects who construct particular, context-bound interpretations of their own identity and their immediate environment and emphasize the role of collectively constructed policy discourses and story lines in shaping the individual actors' interpretations. Last but not least, poststructuralist governmentality theory analyzes the collective rationalities and institutionalized practices that define how to govern and be governed. It shows how a new advanced liberal governmentality aims to shift the burden of government to local networks and partnerships in which the energies of free and responsible actors are mobilized and given a particular direction to ensure conformity with overall policy objectives. Although the different theoretical approaches can be further developed and refined, they all provide important insights into problems and practices of modern governance, and the presence of competing theories founded on different assumptions about the social action and the nature of society fosters critical debates and academic exchanges that tend to sharpen the conceptual frameworks, arguments, and methods.

See also

Accountability, Civil Society, Corporatism, Foucault, Michel, Globalization, Institutionalism, Interpretive Theory, Market, Network, Pluralism, Rational Choice Theory

Further Readings
  • Dean, M. (1999). Governmentality. London: Sage.
  • Jessop, B. (2002). The future of the capitalist state. Cambridge, UK: Polity Press.
  • Kooiman, J. (1993). Modern governance: New government-society interactions. London: Sage.
  • March, J. G., & Olsen, J. P. (1995). Democratic governance. New York: The Free Press.
  • Pierre, J., & Peters, B. G. (2000). Governance, politics, and the state. Basingstoke, UK: Palgrave-Macmillan.
  • Rhodes, R. A. W. (1997). Understanding governance. Buckingham: Open University Press.
  • Rhodes, R. A. W., & Bevir, M. (2003). Interpreting British governance. London: Routledge.
  • Scharpf, F. W. (1999). Governing in Europe. Oxford, UK: Oxford University Press.
  • Sørensen, E., & Torfing, J. (2007). Theories of democratic network governance. Basingstoke, UK: Palgrave-Macmillan.
  • Treib, O., Bähr, H., & Falkner, G. (2005). Modes of governance: A note towards conceptual clarification.European Governance Papers, No. N-05-02. Retrieved September 5, 2009, from http://www.mzes.unimannheim.de.
  • Torfing, Jacob
    Copyright © 2010 by SAGE Publications, Inc.

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