I MPA-5: Ma Soe Su Sandy Maung

Defining good governance

Governance refers to all processes of governing, the institutions, processes and practices
through which issues of common concern are decided upon and regulated. Good
governance adds a normative or evaluative attribute to the process of governing. From a
human rights perspective, it refers primarily to the process whereby public institutions
conduct public affairs, manage public resources, and guarantee the realization of human
rights.  

While there is no internationally agreed definition of 'good governance, it may span the
following topics: full respect for human rights, the rule of law, effective participation,
multi-actor partnerships, political pluralism, transparent and accountable processes and
institutions, an efficient and effective public sector, legitimacy, access to knowledge,
information and education, political empowerment of people, equity, sustainability, and
attitudes and values that foster responsibility, solidarity, and tolerance.

In summary, good governance relates to the political and institutional processes and
outcomes that are necessary to achieve the goals of development. The true test of 'good'
governance is the degree to which it delivers on the promise of human rights: civil,
cultural, economic, political and social rights. The key question is: are the institutions of
governance effectively guaranteeing the right to health, adequate housing, sufficient food,
quality education, fair justice and personal security?

Why is governance important?

Governance has become one of the most important concepts in developing countries.
Consequently, many countries are trying to pursue good governance and adoption
according to the established concept of governance to achieve the desired sustainable
economic growth and development. Good governance is important because it acts as the
heart of a successful business where it is essential for an organization in order to
accomplish its objectives while driving the improvement, and also by maintaining legal
and ethical standards shared with the shareholders, regulators, and the community. It also
provides the required responsibilities and practices in order to ensure benefits, and
optimize the resources and the risks while ensuring the company is compliant with the
laws and regulations.

Principles of good governance

The pillars of governance include accountability, transparency, predictability, and

participation these are universally applicable regardless of economic orientation, strategic
priorities, or policy choices of the government in question. However, their application
must be country-specific and purely based on the economic, social, and administrative
capacity of the country. Accountability means the capacity to call public officials to task
for their actions. Transparency entails low-cost access to relevant information.
Predictability results primarily from laws and regulations that are clear, known in
advance, and uniformly and effectively enforced. Participation is needed to supply
reliable information and to provide a reality check for government action. None of these
four components can stand by itself. Each is instrumental in achieving the other three. All
four together are instrumental in achieving sound public management.
The universally accepted characteristics of good governance include participation,
rule of law, transparency, responsiveness, consensus-oriented, equity & inclusiveness,
effectiveness & efficiency, and accountability.

Characteristics of good governance

1.Participation
Participation in the concept of good governance here is an opportunity for everyone to
voice their opinions through institutions or representations. In addition, everyone, without
exception, has the right to freedom of association and expression.

2. Rule of law
To implement good governance, the legal framework in the country must be enforced
impartially, especially concerning human rights law.

3. Transparency
Transparency means that every policy taken and implemented by the government must be
carried out under existing regulations. In addition, there must be a guarantee that any
information related to the policy can be accessed by everyone, especially those who are
directly affected by the policy.

4. Responsiveness
Good governance needs institutions and processes to attempt to serve all stakeholders
within a reasonable time.

5. Consensus oriented
This fifth principle is related to the decision-making process. When the decision-making
process cannot accommodate everyone’s wishes, then at a minimum, the decision must
be a decision that can be accepted by everyone and does not harm anyone.

6. Equity and inclusiveness

Good governance ensures justice for the community. Everyone has the same opportunity
to maintain and improve their welfare.
7. Effectiveness and efficiency
Every decision-making process and its institutions must be able to produce decisions that
meet every community’s needs. Community resources must also be utilised optimally by
the government.

8. Accountability
All institutions involved in good governance have full responsibility to the public for the
sake of improving the quality of society.

Challenges of Good Governance

 There should be freedom of participation by various economic, religious, social,

professional, and cultural groups in the process of governance.
 A recognized legal framework that is based on the rule of law to protect human
rights, safeguard against exploitation, secure social justice, and abuse of power.
 Political accountability involves the acceptability of the political system by the
people, and regular elections to legitimize the exercise of political power.
 An efficient administrative system will have to lead to efficiency and
effectiveness. This, in turn, would mean the value for money and also the cost-
effectiveness.
 Freedom of information is required for the creation of public policies, decision
making, monitoring, and also finally the evaluation of good performance.
 Bureaucratic accountability, safeguarding a system in order to monitor and also
control the performance of government officials, in relation to the service quality.
 Lastly, there is a larger need of cooperation among the government and also the
organizations of civil society.

Good governance contributes to economic growth

How does governance promote economic growth or in a different way, does

misgovernance impede growth?

The six governance dimensions which the World Bank has included in its WGIs provide
the answer to this question. The six are the following:

1. Voice and Accountability: capturing perceptions of the extent to which a country’s

citizens are able to participate in selecting their government, as well as freedom of
expression, freedom of association, and free media.

2. Political Stability and Absence of Violence and Terrorism: capturing perceptions of the
likelihood that the government will be destabilized or overthrown by unconstitutional or
violent means, including politically-motivated violence and terrorism.

3. Government Effectiveness: capturing perceptions of the quality of public services, the

quality of the civil service and the degree of its independence from political pressures, the
quality of policy formulation and implementation, and the credibility of the government’s
commitment to such policies.

4. Regulatory Quality: capturing perceptions of the ability of the government to formulate

and implement sound policies and regulations that permit and promote private sector
development.

5. Rule of law: capturing perceptions of the extent to which agents have confidence in
and abide by the rules of society, and in particular the quality of contract enforcement,
property rights, the police, and the courts, as well as the likelihood of crime and violence.

6. Control of corruption: capturing perceptions of the extent to which public power is

exercised for private gain, including both petty and grand forms of corruption, as well as
“capture” of the state by elites and private interests.

Governance, therefore, makes people feel that they are included in the running of the
affairs of society. This inclusiveness is an important policy goal of modern societies so
that people will become the designers, executers, and judges of their own destinies. They
collectively ensure property rights – the right to life, physical and financial wealth, and
human intellect. When the above-mentioned dimensions, at least as a minimum, are
present in society, people have the ability to benefit from their own labor and efforts. It
gives incentives for them to develop their human and physical capital, invent new things
and use such inventions in market-based productions. The continued market production
ensures a sustainable growth.

Misgovernance reduces the quality of life of people in society. For instance, suppose that
the government is ineffective, public service is inefficient and corrupt and the system
works under the pressure of politicians, elite power groups, and extreme ethnic, religious,
or racialist social sects. Then, the law enforcement agencies, namely, the police and
courts of law, will become dead ducks. As a result, people have no mechanism to get
redressed when they have been harmed simply by other members of society. They have
to live in eternal fear for their life, property, and wealth.
In society, per capita income may have increased to record levels. But what use of that
income if it can be robbed by those who can claim impunity from the system? Property
can be robbed by other fellow citizens, those supported by politicians in power or
governments themselves. This last type of robbery had been a common situation even in
the past. That was why the Buddha had to advise his lay followers, according to
Pattakamma Sutra canonized in Anguttara Nikaya, to protect the wealth earned through
one’s labor from, among others, the greedy kings.

This is similar to the expropriation of private property by modern governments whatever

the justification attributed to such expropriations. It is the observance of the rule of law,
control of corruption, independent and impartial law enforcement agencies, and effective
government that will protect the property rights of people.

Public Trust/ Services

Trust is the foundation upon which the legitimacy of public institutions and a functioning
democratic system rest. It is crucial for maintaining political participation and social
cohesion.  Trust is important for the success of a wide range of public policies that
depend on behavioral responses from the public. For example, public trust leads to
greater compliance with regulations and the tax system. In the longer term, trust is needed
to tackle long-term societal challenges such as climate change, aging populations, and the
automation of work.

Trust in government is considered as indispensable for the effective functioning of

democratic government. Trust in government is also necessary for the fair and effective
functioning of public institutions. According to Jung and Sea, public trust in government
is one of the key factors that determine the government’s competitiveness. Broadly
speaking, public trust in government is important as it speaks to the quality of the
relationship that exists between citizens and their government. Further, one comes across
a strong view that, trust in government functions as the glue that keeps the system
together and as the oil that lubricates the policy machine.

A number of theorists view improved performance in public services as potential

precursors to trust in government while linking distrust mostly to the poor performance of
public institutions. People often demand the government to provide services, such as
health, education, security, law enforcement, electricity, transportation, water, and waste
management. In fact, citizens view government performance not only from the
perspective of service delivery but, also from the efficacy and fairness of government
policy and government ethics.
In any case, if there is any mismatch between the public’s expectations and the actual
performance of government institutions, the public may be forced to consider public
employees as incompetent, wasteful, dishonest, and untrustworthy. On the contrary,
citizens’ perceptions of public sector performance can influence citizens’ perceptions of
the ability, benevolence, and integrity dimension of trustworthiness by demonstrating that
the public sector possesses a set of skills and resources needed to guide society in a
desirable direction. Therefore, a more positive perception of governmental services is
seen as a way of restoring trust in government, in contrast; the opposite is true when the
public develops a negative perception. As stated above, trust in government is a key
element of good governance and may be built up with sound policies that promote
people’s safety and security.

Case Study: Good Governance in Vietnam

Vietnam began implementing the Renovation policy in 1986 to gradually transition

from a centrally planned economy according to the socialist model to a market economy.
The Renovation process has changed the whole thinking behind economic and legal
management in Vietnam. Governance is considered good when ensuring multi-
stakeholder engagement, transparency in decision-making, accountability, effective
management, and commitment to quality and the rule of law. Vietnam is well-known for
its complicated administrative organization, an abundance of civil servants, inefficient
operations, and widespread corruption. Besides this, the government’s performance has
not met the requirements of the people and businesses. The Government of Vietnam has
also made many efforts to solve this situation by applying good governance. For
example, reorganizing the administrative agencies to be more compact; requiring civil
servants to work professionally, cleanly, openly, transparently, and accountably; and
renovating the organization and operation of the Government in the direction of leanness,
effectiveness, and efficiency. Public governance in Vietnam has attracted many
qualitative and quantitative studies in recent times.

The term ‘good governance’ was defined in the 1990s during the reform of the public
sector and the implementation of new public management models in many countries. The
‘good governance’ model has eight fundamental characteristics, namely: participation,
consensus orientation, accountability, transparency, responsiveness, equality and
inclusion, effectiveness and efficiency, and law enforcement compliance. In recent
decades, the Government of Vietnam has integrated this model into national governance.
Many studies have shown that the application of this model has brought considerable
successes, such as efficiency in governance and better public administration, contributing
to improved income distribution and poverty reduction and cementing the relationship
between the state and the people. According to the survey results of the United Nations in
2018, Vietnam ranked 88 out of 193 countries in terms of online e-government and 59
out of 193 countries on the online public service index. The whole country has over
46,800 public services, of which 38,587 are level-3 online public services and 8590 are
level-4 ones. Administrative procedures are reduced, creating favorable conditions for the
people and businesses (Ministry of Home Affairs 2020). The Satisfaction Index of Public
Administrative Services (SIPAS) contains such indicators as the people and
organizations’ perceptions, satisfaction levels, and expectations, applied by the
Vietnamese Government in 2018. In 2021, the 13th National Congress of the Communist
Party of Vietnam advocated “renovating national governance towards modernity and
efficiency”.

Hanoi – Vietnam is expected to accelerate its economic recovery from the pandemic
this year after having recorded a 2.6 percent increase in gross domestic products (GDP)
in 2021, Singapore’s Business Times reported.

Once among the poorest countries in the world, its economy is now booming and the
World Bank describes it as one of the most dynamic and emerging countries in the entire
East Asia region, Business said in an article published last week, calling Vietnam a “new
Asian tiger.”

Singapore’s DBS Group Research forecasts Vietnam's GDP growth to reach 8 percent
in 2022, boosted by an accommodative monetary policy. The International Monetary
Fund (IMF) has predicted that Vietnam will climb three spots to rank third in GDP
among ASEAN member states this year, thanks to the fast-growing middle class and the
rise of ultra-rich people.

Knight Frank’s latest Wealth Report estimates there were about 19,500 high-net-
worth individuals in Vietnam in 2020, defined as those with assets of at least 1 million
USD, the article said. By 2025, that number is expected to grow by almost 25 percent to
the top 25,000, it added.

Business Times attributed the robust growth of the economy to increasing flows of
foreign investment into the country. Many Singapore companies, including CapitaLand
and Keppel, have invested heavily in the country as they seize the abundant
opportunities.

“Vietnam has long been known as Southeast Asia's coding farm, where talent and
wages are in a sweet spot for companies to use it as a base for their technical
development,” it noted.