Financial Governance

Definition ∞ Financial Governance refers to the systems and processes by which financial entities are directed and controlled. It involves establishing rules, policies, and oversight structures to ensure responsible financial management and accountability. This framework guides decision-making regarding capital allocation, risk management, and regulatory adherence. Effective financial governance promotes stability and trust.
Context ∞ Financial governance is a critical area of focus in the digital asset space, particularly for decentralized autonomous organizations and crypto projects. News often covers debates about governance token mechanisms, community voting, and the transparency of financial operations within decentralized protocols. The challenge involves establishing robust governance structures that maintain decentralization while ensuring operational integrity and investor protection.