Governance assessment

Political economy analysis is part of a broader landscape of donor work on governance assessment. Whilst conventional governance assessment is very different to political economy analysis – governance assessment tends to focus on measuring the performance, accountability, responsiveness and capacity of formal institutions, whereas political economy analysis aims to understand why deficits in these areas arise – the two can be complementary. Governance assessment can inform a political economy analysis and vice versa, and the issues they identify may overlap.

Many donors undertake governance assessments, using their own distinct methodology and approach. In spite of calls for a more harmonized approach, examples of co-ordinated assessments are rare (OECD DAC, 2009). There is also concern that governance assessments should encourage country ownership, and should draw on, and align with, nationally driven or peer-based assessments. The Rwanda Joint Governance Assessment is one example of how such principles can be built into governance assessment, and illustrates the opportunities and difficult challenges involved.

Page contents:

International guidance and lessons learned

UNDP, 2009, ‘Planning a Governance Assessment: A Guide to Approaches, Costs and Benefits’, UNDP Oslo Governance Centre, Norway
This guide examines the basic issues that a country or organization should consider when developing and producing a governance assessment. The paper explains the trade-offs of various approaches and methodologies in terms of quality and costs. It provides advice as to ensuring the assessment produces meaningful results that can be used by civil society and governments alike. How a country-led governance assessments can be carried out with broad stakeholder participation at a reasonable cost. At the same time, it also provides some basic background on the technical aspects of conducting a governance assessment.
See full text

Kaufman, D., and Kray, A., 2007, ‘On Measuring Governance: Framing Issues for Debate’, Issues paper for 2007 Roundtable on Measuring Governance, World Bank, Washington D.C.
How can the measurement of governance be enhanced? This paper highlights key issues for users and providers of governance indicators. It contends that: (1) all governance indicators have weaknesses; (2) there are no easy solutions in measuring governance; and that (3) the links from governance to development outcomes are complex. Policymakers should view the different types of indicators as complementary rather than competing.
See full text

OECD DAC, 2008, ‘Survey of Donor Approaches to Governance Assessment’, Organisation for Economic Cooperation and Development – Development Assistance Committee, Paris
Many development agencies are engaged in assessing governance. What are their approaches and how can these be more effectively harmonised? This study surveys donors’ use of general and thematic governance assessment. Most approaches are driven by policy dialogue, detailed planning of governance enhancement activities and strategic decisions regarding aid to specific countries. Linkage to a donor’s programme, demand from the field and removal of institutional disincentives are important in determining how governance assessments are used.
See full text

OECD DAC, 2009, ‘Donor Approaches to Governance Assessments: Guiding Principles for Enhanced Impact, Usage and Harmonisation’, Organisation for Economic Cooperation and Development – Development Assistance Committee, Paris
This note presents the findings of an initial survey of donor governance assessments, which pointed to the risk of frequent duplication and overlap between donor tools, as well as the need to improve practice with regard to greater reliance on partner country assessment processes. The guiding principles for enhancing the impact, usage and harmonisation of governance assessments are presented in five areas: (1) Building on and strengthening nationally driven governance assessments; (2) Identifying a clear key purpose to drive the choice of assessment tools and processes; (3) Assessing and addressing governance from different entry points and perspectives; (4) Harmonising assessments at country level when the aim is to stimulate dialogue and governance reform; and (5) Making results public unless there are compelling reasons not to do so.
See full text

‘The Oslo Principles on Democratic Governance Assessments’, Oslo Governance Forum, 3-5 October 2011
The Oslo Principles is a statement designed to promote and strengthen democratic governance at the local and national levels. The Principles are also expected to serve as a reference point and guide institutions and practitioners in the area of governance monitoring, assessment and analysis.
See full text

Critiques of governance indicators

Several recent articles criticise indicators used in governance assessments. Criticisms include how donor-driven governance indicators (such as those of the World Bank) have become politicised, functioning to determine aid allocations and the general public perception of a country’s government. Agencies tend to define the problem through their own institutional lens, and the assessment tools they create reflect these biases. Though there are several governance indicators purporting to measure different aspects, some argue that they are, in fact, measuring the same thing.

Arndt C., 2008, ‘The Politics of Governance Ratings’, International Public Management Journal, vol. 11, no. 3, pp 275-297
What explains the popularity and misuse of the prominent governance indicators produced by the World Bank and others? This article argues that producing and using a range of more targeted, transparent indicators would benefit all stakeholders. Among hundreds of existing governance indicators, the most popular are perception-based composite indicators, primarily of use to international organisations, donors, investors and the media. These indicators summarise vast amounts of data that exists for a large number of countries, but the drawbacks of relying heavily on them are significant.
See full text

Stone, C. E., 2011, ‘Problems of Power in the Design of Indicators of Safety and Justice in the Global South’, Program in Criminal Justice Policy and Management, Harvard Kennedy School, Cambridge, MA
This paper argues for a bottom-up approach to the design of global safety and justice indicators: starting with local ambitions and local authority could help address the weak sources of legitimacy for the standards implicit in global indicators. The paper outlines how indicators can be designed collaboratively at local level, and how locally-owned indicators can be aggregated up to a global level. It also suggests how such ‘active’ indicators built at the domestic level could become a coherent, global set of common indicators.
See full text

Slotin, J., Wyeth, V. and Romita, P., 2010, ‘Power, Politics, and Change: How International Actors Assess Local Context’, International Peace Institute, New York
Do assessments actually affect decision making, planning and programming? This report presents observations from an informal analysis of conflict, governance, and fragility/stability assessment tools developed by bilateral and multilateral actors. Use of assessments is affected by clarity of purpose, timing, incentives, staff competencies and linking assessment into a broader strategy. It is important to be realistic about what assessments can accomplish, link assessments to a planning cycle and build a culture of analysis.
See full text

Langbein,L. and Knack, S., ‘The Worldwide Governance Indicators: Six, One, or None?’, Journal of Development Studies, vol. 46, no. 2, pp350-370
What is the validity and reliability of aggregate indexes of the quality of governance such as the Worldwide Governance Indicators (WGIs)? This study uses factor, confirmatory factor and path analysis to test both measurement and causal models of the six WGIs. Rather than distinguishing among aspects of the quality of governance, this paper finds that they appear to be measuring the same broad concept. The WGI authors should publicly release the sub-indicators to allow further investigation.
See full text

Donor approaches to governance assessment

DFID Country Governance Assessment

DFID, 2008, ‘Country Governance Analysis’, How To Note, Politics and the State Team, Department for International Development, London
See full text

UNDP Democratic Governance Assessments

UNDP, 2009, ‘Supporting Country-led Democratic Governance Assessments: Practice Note’, Oslo Governance Centre, United Nations Development Programme, Oslo
See full text

  • The UNDP’s Governance Assessment Portal includes information and publications on both UNDP’s and other donors’ approaches to governance assessment.

World Bank: Institutional and Governance Review

World Bank, 2001, ‘Institutional and Governance Reviews’, Tools and Practices 15, World Bank, Washington D.C.
See full text

Participation and national ownership

Donors are increasingly concerned that governance assessments should encourage country ownership, and should draw on, and align with, nationally driven or peer-based assessments.

Meyer, S., 2009, Governance Assessments and Domestic Accountability: Feeding Domestic Debate and Changing Aid Practices’, Fundación para las Relaciones Internacionales y el Diálogo Exterior (FRIDE), Madrid
How is it possible to manage the competing tensions that arise in aid accountability? Based on governance assessments, this paper analyses current developments in mutual accountability relations between donors and aid recipients and how these relate to the domestic accountability of governments to their citizens. Donors are challenged by inaccurate perceptions of themselves and their operations, and often have little experience in engaging with the local public sphere. Donors should make better use of available indicators, adhere to existing initiatives, devise public relations strategy at a local level, and support local research capacities.
See full text

UNDP, 2007, ‘Opportunities for Inclusive Participation and National Ownership’, Seminar, Bergen, Norway, 23 –25 September 2007
This report presents the results of a 2007 UNDP/ Chr. Michelsen Institute (CMI) seminar focused on governance assessments in the context of the Paris Declaration and its principles of national ownership, national capacity development, alignment and harmonization. The conference aimed to provide an international forum to bring in the voice of developing country partners as well as to expand the focus of governance assessments beyond donor driven approaches to nationally driven governance assessments, and assessments based on a peer review mechanism.
See full text

Williams, G. et al., 2009, ‘Carrying out a Joint Governance Assessment: Lessons from Rwanda’, The Policy Practice, London
Can a joint approach to governance assessment help to improve aid effectiveness? What can be learned from the first Joint Governance Assessment (JGA) undertaken in Rwanda during 2008? A JGA aims to bring government and development partners together to review governance performance based on commonly agreed indicators. This brief from The Policy Practice recommends that such an assessment can prove to be helpful to advancing dialogue, but is likely to be a long-term and difficult process that is only suited to particular circumstances where the process can address joint concerns of government and donors.
See full text

Hyden, G. et al., 2008, ‘Governance Assessments for Local Stakeholders: What the World Governance Assessment Offers’, Overseas Development Institute, London
How can governance assessments enhance governance as an analytical tool and a civic activation mechanism? The World Governance Assessment (WGA) is based on principles of national ownership and local consultation, and the need to strengthen monitoring institutions and diagnostic tools. This Overseas Development Institute (ODI) paper publishes findings from the WGA second round, arguing that it is uniquely placed to serve both donor and local interests. The WGA builds capacity of local researchers, provides a sense of ownership, captures local context, and allows for cross-country comparison.
See full text

Maksym, I. and Shah, A., 2010, ‘Citizen-centric Governance Indicators: Measuring and Monitoring Governance by Listening to the People and Not the Interest Groups’, Policy Research Working Paper 5181, World Bank, Washington, D.C.
How can governance measurement be improved? Governance indicators influence development work and foreign direct investment, but this World Bank paper argues that current indicators are inadequate because they fail to conceptualise governance or to capture citizen opinion. It offers instead a citizen-centric framework for measuring governance quality based on four dimensions: responsiveness, fairness, responsibility and accountability. Governance is “an exercise of authority and control to preserve and protect public interest and enhance the quality of life enjoyed by citizens”.
See full text