There is a plethora of definitions of governance; various institutions define it differently depending upon their own contexts. For instance, from the development view point, the World Bank identifies three aspects of governance: i) the form of the political regime; ii) the process by which authority is exercised for the management of a country’s economic and social resources; and iii) the capacity of government to formulate and implement policies and discharge functions.[1] Similarly, the Canadian International Development Agency (CIDA 1996) defines it as “the exercise of power by various levels of government that is effective, honest, equitable, transparent and accountable”. Daniel Kaufmann et al (2005), in aggregating governance indicators, identifies six dimensions of governance: i) voice and accountability; ii) political instability and violence; iii) government effectiveness; iv) regulatory quality; v) rule of law; and vi) control of corruption. In general, most of the literature agrees on common dimensions of governance like participation, rule of law, transparency, accountability, effective delivery of services and equity.

Good governance is one of the nine domains of Gross National Happiness (GNH) aimed towards enhancing the well-being of the Bhutanese people. Unlike other domains, governance cuts across all domains/sectors and therefore, its effect on the society at large arises from the cumulative efforts of all sectors. Article 9 of the Constitution of the Kingdom of Bhutan states, “the State shall strive to promote those conditions that will enable the successful pursuit of Gross National Happiness”. Though the constitution has been adopted only recently, happiness has been the main concern of all our monarchs, especially the Fourth Druk Gyalpo. Happiness has also been the ultimate purpose of social and economic development plans and programs since the early seventies. Although GNH was not expressed explicitly then, the provision of free health and education services, development of basic infrastructure, supply of clean drinking water, allotment of free timber to build houses, granting land and other kidu have been all aimed towards reducing misery and enhancing the welfare of the citizens. The pursuit of GNH is further continued by changing the political system from a monarchy to a parliamentary democracy.

It is evident from the reigns of all the successive Kings of Bhutan that the ultimate purpose of governance has been to bring greater well-being and happiness to a greater number of people. In this respect, governance in Bhutan has always been an integral part of the system of government and of political structures, which reflect and internalise GNH values. In particular, efficiency, transparency and accountability have been the main thrust of the good governance exercise carried out in 1999 and revised in 2006 to enhance good governance in the country.