ADB's Work on Governance and Public Management
ADB is supporting governments in Asia and the Pacific to work more efficiently and equitably to achieve their development goals. This includes strengthening government institutions and helping improve the quality and delivery of services to the public. ADB’s governance work focuses on a number of key areas, including public expenditure management, economic affairs, and public administration. ADB also assists in reforming state-owned enterprises, decentralization, legal reform, and social protection.
ADB’s Strategy 2030 Operational Priority 6 identifies strengthening governance and improving institutional capacity as key drivers of change in its member countries. Operational Priority 6 aims to:
- Enhance public management and financial stability
- Improve government and institutional capacity to deliver services
- More effectively utilize country systems and standards
ADB is working with its developing member countries (DMCs) to help them meet their UN Sustainable Development Goal targets through efficient use of public finances whilst preserving their ability to manage national debt. This is achieved by creating sustainable fiscal space by improving domestic resource mobilization and promoting efficient use of scarce public resources. ADB promotes allocative efficiency (the most efficient allocation of scarce public resources) by investing in quality infrastructure, helping reform State Owned Enterprises (SOEs), and prioritizing value for money.
ADB supports tax reform to strengthen public finances, as well as initiatives such as the Asia Pacific Tax Hub. The hub partners with ADB DMCs to establish domestic revenue mobilization and international tax cooperation goals. The goals include a medium-term revenue strategy and a road map for digitalization of tax administration. International tax cooperation is also fundamental to the work of the hub, supporting such initiatives as the OECD’s Global forum on Transparency and Exchange of Information for Tax Purposes and the Base Erosion and Profit Shifting principles. The hub collaborates closely with development partners to strengthen implementation of necessary reforms.
The bank’s Second Governance and Anti-Corruption Action Plan strengthens oversight of ADB projects and improves internal checks and balances. The scope of the work is broad, including tackling corruption and expanding e-governance. As a consequence ADB prioritizes financing and knowledge support where they can have the greatest impact on social and development goals.
ADB is working to reduce widespread, systemic corruption at national and local level in its member countries. The bank does this by helping to strengthen key government institutions that advance transparency and accountability. These include supreme audit agencies, procurement agencies, regulatory agencies, and ombudsman offices. ADB also supports regional initiatives and research on advancing accountability and transparency in the region.
In developing Asia, good corporate governance is an important factor in advancing sustainable development. Although many governments have policy and legal mechanisms to promote sustainable development, reform and implementation are often slow. This can be due to limited institutional capacity, lack of technical expertise or insufficient funding. ADB's commitment to environmental justice supports several initiatives that strengthen public and judicial environmental regulation and enforcement.
ADB supports countries in implementing decentralization in areas such as the delivery of public services, infrastructure development, and financial management. Many countries in the region have engaged in decentralization and local government reform. These reforms can have tangible social and economic benefits when they empower regional or local governments to improve delivery of services. ADB and its development partners have increasingly sought a common approach to facilitate decentralization.
Increasingly, decentralization has meant a more important development role for local governments across the region. In recognition of this, ADB supports client countries in implementing local governance reforms, such as in finance, public expenditure, service delivery, regulations, and institutional development. Improved local governance is crucial for transparent, accountable, efficient, and effective delivery of public services at the local level. This is critical for localizing SDG targets.
Domestic resource mobilization and fiscal consolidation
The challenge for many governments in Asia is financing development projects, while managing debt and stimulating the private sector. ADB supports countries in improving domestic resource mobilization for inclusive growth. This assistance primarily focuses on improved tax efforts. Fiscal consolidation covers public expenditure management and improved governance. ADB also works to boost domestic savings and increase private investment in small and medium businesses.
E-governance and ICT
Information and communication technology (ICT) is important in governance reform and can help improve public services, as well as allow greater access to information. E-governance refers to ICT-related reforms to promote more efficient government, better government services, and enhanced government accountability. ADB supports its member countries in implementing e-governance and ICT reform. Enhanced e-governance can lower administrative costs and lead to improvements in dealing with official requests and queries.
Fragile and conflict-affected states
Many of the region’s poor and most vulnerable live in fragile, conflict-affected, and small island developing states. These countries are uniquely susceptible to development challenges such as weak governance, economic and social disruption, geographic isolation, and insecurity. Public services seldom function well in these countries. ADB’s Strategy 2030 recognizes that such places require special support.
Governance Thematic Group
ADB’s Governance Thematic Group fosters knowledge sharing on governance and related issues. The group runs seminars and other events to share operational experience. It also provides a forum for global thought leaders to discuss emerging trends, practices, and innovation in governance and public sector management.
ADB works in partnership with development agencies, donors, and networks on knowledge sharing, capacity development, and institutional strengthening to support regional and sub-regional governance and public management reforms. These include:
Governance and development
Research shows clearly that despite differing political systems across the region, economic and social development in Asia and the Pacific has gone hand-in-hand with quality governance. In recognition of this, in 1995 the bank became the first MDB to adopt a Governance Policy. The policy led to a number of ADB good governance projects and the concept has been established as one of the three pillars of ADB’s Poverty Reduction Strategy.
Strategy 2030 sets seven operational priorities, each having its own operational plan. The operational plans contribute to ADB’s vision to achieve prosperity, inclusion, resilience, and sustainability, and are closely aligned with Strategy 2030 principles and approaches.