Value chain governance refers to the relationships among the buyers, sellers, service providers and regulatory institutions that operate within or influence the range of activities required to bring a product or service from inception to its end use. Governance is about power and the ability to exert control along the chain – at any point in the chain, some firm (or organization or institution) sets and/or enforces parameters under which others in the chain operate. Understanding how and when lead firms set, monitor and enforce rules and standards can help micro and small enterprises (MSEs) and other firms in the chain better integrate and coordinate their activities. Awareness of the governance structure of a value chain can provide governments, donors and development practitioners with information about how best to provide MSEs with the training and technical assistance needed to upgrade their position in the chain.
Read more about Governance in the Good Practice Center.