CHAPTER 1 Flashcards
Until the late ______ governance was not a word heard frequently
1800s
First used by world bank and ____ in the report on ______
1989 ; sub-Saharah Africa
In _____ the world bank introduced good governance as part of its _____ for lending to developing countries
1992; criteria
is the name given to the entity exercising that authority.
Government
can most simply define as legitimate power to make decision on behalf of the organization.
Authority
is therefore based on an acknowledged duty to obey rather than on any form of coercion or manipulation.
Authority
the ability to influence the behavior of others, authority is the right to do so.
Power
distinguished between three kinds of authority, based on the different grounds upon which obedience can be established
Weber
Three types of authority
Traditional authority
Charismatic authority
Legal authority
is rooted in history or tradition like monarchies.
Traditional authority
stems from personality-derives from individual’s extraordinary personal qualities. Examples: Martin Luther, Nelson Mandela
Charismatic Authority
is grounded in a set of impersonal rules. It is a form of leadership in which authority of a ruling government regime comes from system of bureaucracy, public choice and legality.
Legal authority
The system by which entities are directed and controlled. It is concerned with structure and processes for decision-making, accountability, control, and behavior at the top of an entity.
Governance
influences how an organization’s objectives are set and achieved, how risk is monitored and addressed and how performance is optimized”.
Governance
is a system and process, not a single activity and therefore successful implementation of a good governance strategy requires a systematic approach that incorporates strategic planning, risk management, and performance management.
Governance
it is a core component of the unique characteristics of a successful organization.
Governance
defines ____ as the process whereby societies or organizations make their important decisions, determine who has the voice, who is engaged in the process, and how an account is rendered.
Governance IOG
It assures that corruption is minimized, The views of minorities are taken into account, and that the voices of the most vulnerable in society are heard in decision-making. It is also responsive to the present and future needs of society.
Good Governance
Characteristics of Good Governance
Participation
Consensus Orientation
Accountability
Transparency
Responsiveness
Equity and Inclusiveness
Effectiveness and Efficiency
Rule of Law
All men and women should have a voice in decision-making, either directly or through legitimate intermediate institutions that represent their interests. Such broad participation is built on freedom of association and speech, as well as capacities to participate constructively.
Participation
Good governance mediates differing interests to reach a broad consensus on what is in the best interests of the group and,. Where possible, on policies and procedures
Consensus Orientation
Is based on the principle that every person or group is responsible for their actions, especially when their acts affect the public interest.
Accountability
It refers to the answerability or responsibility for one’s actions so that systems exist for decision-makers in government, the private sector and civil society organizations to answer to the public, as well as to institutional stakeholders.
Accountability
built on the free flow of information. Processes, institutions, and information are direct and accessible to those concerned with them, and enough information is provided to understand and monitor them.
Transparency
Good governance requires that institutions and processes try to serve all stakeholders within a reasonable timeframe.
Responsiveness
All men and women have opportunities to improve or maintain their well-being.
Exist where everyone has opportunities to improve or maintain their well-being. This means that all members of society, especially the most vulnerable, are taken into consideration in policymaking, and no one feels alienated, disenfranchised or left behind.
Equity and Inclusiveness
Processes and institutions produce results that meet needs while making the best use of resources.
Effectiveness and Efficiency
It demands that the people and civil society render habitual obedience to the law.
It also demands that the government acts within the limits of the powers and functions prescribed by the rule of law means “peace and order” “absence of corruption”, an impartial and effective justice system”, observance and protection of human rights.”
Rule of Law
Importance of Good Governance
▪ Strong and effective corporate governance helps to cultivate a company culture of integrity, leading to positive performance and a sustainable business overall.
▪ Essentially, it exists to increase the accountability of all individuals and teams within your company, working to avoid mistakes before they can even occur.
▪ When a company has solid corporate governance, it signals to the market that the organization is well managed and that the interests of management are aligned with external stakeholders.
▪ As a result, it can provide your company with a strong competitive advantage.
▪ Bad corporate governance can cast doubt on a company’s operations and its ultimate profitability.
Benefits of Good Governance (Long Version)
▪ Good corporate governance creates transparent rules and controls, provides guidance to leadership, and aligns the interests of shareholders, directors, management, and employees.
▪ It helps build trust with investors, the community, and public officials.
▪ Corporate governance can give investors and stakeholders a clear idea of a company’s direction and business integrity.
▪ It promotes long-term financial viability, opportunity, and returns.
▪ It can facilitate the raising of capital.
▪ Good corporate governance can translate to rising share prices.
▪ It can lessen the potential for financial loss, waste, risks, and corruption.
▪ It is a game plan for resilience and long-term success.
Benefits of Good Governance
- Efficient Processes
- Visibility of Errors
- Reduced Costs
- Smoother-Running Operations
- Compliance
due to the repeatability and consistency of tasks performed.
Efficient Processes
this repeatability and consistently helps to quickly identify the nonconformities in processes.
Visibility of Errors
when tasks are streamlined, companies can eliminate the waste from scrap, rework, and any other costly inefficiencies.
Reduced Costs
regular disruptions from inconsistent processes are eliminated, as operation specifics become either ‘conform’ or ‘non-conform’.
Smoother Running Operations
a culture that supports corporate governance allows for its product to reach the market while meeting its intended specifications and working
Compliance
