The impact of good governance on business development

Good governance is the process of measuring how public institutions conduct public affairs, manage public resources and guarantee the realisation of human rights in a manner essentially free of abuse and corruption and with due regard for the rule of law. Good governance is the act of public institutions meeting the objectives of the constitution of a nation. For example, the two major objectives of the constitution of Nigeria are security and welfare of the people. Chapter 2, Section 14 of the 1999 Federal Republic of Nigeria constitution states that: (1) The Federal Republic of Nigeria shall be a State based on the principles of democracy and social justice. (2) It is hereby, accordingly, declared that: (a) sovereignty belongs to the people of Nigeria from whom [the] government through this Constitution derives all its powers and authority. (b) the security and welfare of the people shall be the primary purpose of government; etc. Good governance must therefore, ensure these two objectives of security and welfare of the people are met.

Governance refers to all processes of governing or leading and managing a people, the institutions of governance, processes and practices through which issues of common concern are decided upon and regulated. Good governance adds normative or evaluative attributes to the process of government. From a business developer’s perspective, good governance refers primarily to the process whereby public institutions conduct public affairs, manage public resources and guarantee the realisation of economic efficiency with as many residents having jobs as possible. The government must realise that a nation is a system. A system is a unit of interrelated parts, in which the malfunction of a part will affect the performance of other parts and the performance of the system in general. The malfunction of the government institution, business or education or health or transport sector will affect the performance of the economy.

While there is no internationally agreed definition of ‘good governance’, it suffices to say that it may cover 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. According to the United Nations Organisation (UNO), Good Governance is measured by the eight factors of Participation, Rule of Law, Transparency, Responsiveness, Consensus Oriented, Equity and Inclusiveness, Effectiveness and Efficiency, and Accountability. A good leader who wants to practise good governance must ensure that the government is participatory and that there is enforcement of laws to ensure peace, fairness and justice.

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? In the 1990s, the World Bank became the first international institution to adopt the concept of good governance into lending arrangements for developing countries and introduce the idea to the general public. In the World Bank 1992 report titled, “Governance and Development”, the notion of good governance was written as the way in which power is used to regulate the economic and social resources of a country for development.

Now, the term good governance has often been used by national and international organisations. Good governance aims to minimise corruption, take into account the opinions of minorities, listen to the voices of the oppressed people in the decision-making process, and respond actively to the needs of the community now and in the future. The principles of democracy and good governance are aligned in this area if we place the doctrine of “taking into account the opinions of minorities” and the democratic norm of “majority have their way, minority have their say, while everybody has their pay”. The Saturday, February 25, 2023 general election exercise to elect a leader for Nigeria was a crucial one for business development. Since business is about the production of goods and services, generating incomes and profits for people and income and corporate taxes for the governments, serious governments must take the issue of business development seriously.

The voters must also take into cognisance the ability of each candidate to meet their aspiration of getting a job and earning income. A corrupt leader can never be a good leader as he or she cannot meet the principles of good governance. Corruption is a double-edged sword for employment and infrastructural development. The ripple effect is unimaginable! While corruption causes indolence in the people as those that are close to the corrupt leaders see it as a good way of life and wait for their own opportunity to amass wealth through corruption and not through hard work, corruption also depletes the financial resources of the community where leaders are practising it. Corruption is, therefore, worse than slave trade. The caveat about corruption is that it is only education that can solve it. It is, therefore, rampant in communities where we have low literacy level among the people, high rate of poverty and lack of rule of law!

One prominent feature of developed nations is “high rate of business development”. For example, in the United States of America (USA), in 2021, non-agriculture wage and salary employed 146,736,900 people, and services provision 126,457,400 people. These can be broken down to Professional consultancy and business services (21,249,500); Healthcare and social assistance (20,084,000); State and local government (19,118,900); Retails trade (15,396,000), Leisure and hospitality (14,100,800); and non-agriculture self-employed (9,213,200).