The foundations of this chapter build on the theory presented in Chapter 24. There, the public, private and third sectors were presented as the three fundamental organised ways of responding to human problems. Each sector comprises an aggregation of formal organisations, those that have a public persona, an accountable structure and the resources to respond systematically to problems. Formal organisations in all three sectors have the same core five elements of their structure. They are: owners, who all have a role in decision-making (with principal owners making the critical decisions); governance, the way owners are appointed (such as shareholding, public elections and private elections); operational priorities, the concepts utilised by owners and their agents to achieve their purposes; and other elements – distinctive human resources and other resources. It is accountability which is the overarching and the linking concept between the elements and principles of formal organisations. In this chapter I shall refer to this linking concept as the major principle.
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