"Good governance" is generally used to refer to the strength of public institutions in the developing world. It is generally a technocratic term, used especially by the World Bank, to evaluate how competently a country is run.
One of the most important elements of good governance is lack of corruption. On this measure, governance standards examine to degree to which leaders siphon off public money to personal bank accounts, whether bribery is common, and the amount of cronyism (awarding jobs or contracts to friends or relatives rather than the best people for the job).
Another measure of good governance is effectiveness. For example, even if a country has good laws on paper, laws that exist on paper may or may not be well-enforced. The quality of public works and infrastructure also matter in terms of whether projects actually get completed or whether they get held up by bureaucratic incompetence.
Another common index of good governance is "ease of doing business' which includes things like ability of businesses to get permits on a timely basis and the competence or obstructiveness of government bureaucracy.