Developing more efficient, transparentpublic institutions in the Bank's client countriesrequires a two-pronged approach. First, countries must buildtheir capacity to perform functions such as policymaking andpolicy implementation, regulation, service delivery, andadministrative management. Second, they must enhance thestate's accountability-both internally, among theexecutive, legislative, and judicial branches, andexternally, to citizens, users of public services, and otherstakeholders. Initiatives in both areas contribute to goodgovernance, understood as the exercise of public authorityfor the common good. To succeed, this approach must be basedon a solid diagnosis of the weaknesses it is trying toaddress, accompanied by awareness and buy-in from citizens,politicians, and the international community.