The Bank’s increased attention to governance since the early 1990s has naturally brought with it calls for robust measures that enable us to specify what exactly we are trying to improve in this area and how well we seem to be doing it. Overall, however, the consensus on the centrality of good governance to development is yet to be matched by agreement on good indicators for it.
The Bank consults with each government it works with to prepare a country assistance strategy (CAS) that aligns the Bank’s program with the government’s development strategy. In the East Asia and Pacific region, Cambodia and Indonesia have focused on governance to the point of developing “governance CASs.” These strategies include finely-grained, micro-level performance indicators that are essential to assess how well Bank programs are helping countries ease the governance constraints to their core development objectives.
But we need additional measures to enable us to answer two core questions:
- Does Bank assistance help to strengthen governance?
- Does better governance lead to improved development and poverty reduction?
Answering the first question requires “actionable” governance indicators (AGIs). These provide evidence on the characteristics and functioning of particular elements and sub-elements of the various dimensions of governance, such as the quality of the civil service or the strength of accountability institutions. And they are actionable to the extent that they make clear to both clients and donors what steps a government needs to take to improve its score. A good example of a coherent set of AGIs is the Public Expenditure and Financial Accountability (PEFA) framework. Although it took several years to develop, PEFA is an integrated measurement system for a core governance element that a number of donors consulted and agreed upon. The Bank is beginning similar initiatives for AGIs in other areas of public sector governance.
Answering the second question requires macro-level governance indicators. These are far more contentious, provoking often fierce disagreements. Soon, we’ll dig deeper into why that is the case. Until then, can you identify measures of governance—at any level, and be they cross-national or country-specific—that you think are particularly good?