It concluded that sustainable development can only take place if a predictable and transparent framework of rules and institutions exists for carrying out private and public businesses. The report stated that the World Bank’s interest in governance derives from its concern for the sustainability of the projects it funds. For the World Bank, governance was defined in its 1992 report on “Governance and Development” as “the manner in which power is exercised in the management of a country’s economic and social resources for development” (p. Searching for answers to the question of what is governance, one finds a variety of definitions.
In addition, effective implementation of a good governance system decreases the risk of fraud by encouraging a work environment that is not conducive for such behavior especially because there is better monitoring and control of management and accountability of the board through the nomination and remuneration committees, which sets the tone at the top. As was mentioned in Chapter 3, the processes that are involved in corporate governance (CG) also play a key role in controlling corruption by promoting ethical behavior and enhancing competence. Generally speaking, governance describes the elements of organizational control and accountability that are necessary for the good management of any organization, private or public. In addition, governance for the public sector will also be discussed and so will the issue of culture in the private and public echelon of an entity. In this chapter, the UK, US, and Australian governance principles will be addressed. Governance is such an example, and it will be addressed by considering not only the Organisation for Economic Co-operation and Development (OECD) principles (20), the United Nations (UN) approach, but some national approaches as well. The previous chapter explained that in a world of multinationals and globalization, thinking of some issues (e.g., sustainability) globally helps to improve a situation locally.
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