Tourism governance today extends far beyond destination marketing - it is fundamentally about destination management. From addressing overtourism in urban centres to reconciling immediate economic gains with long-term quality of life, today’s destination governance demands coordination, political will, and genuine community engagement. The central question is no longer who promotes a destination, but rather: who governs it, for whom, and by what means?

Yet many destinations still struggle with fragmented decision-making, unclear mandates, and limited involvement of residents. Governance frameworks often remain misaligned with the growing complexity of tourism systems. According to the OECD, governance refers to the exercise of political, economic, and administrative authority necessary to manage a nation’s affairs. Closing governance gaps in tourism thus calls for not only strong leadership and institutional capability, but also innovative, cross-sectoral models of collaboration.

This challenge is particularly pressing in Europe, which remains the most visited continent in the world, with 747 million international arrivals in 2024. Travel and tourism has become the fastest-growing sector in the global economy - outpacing information and communication, financial services, manufacturing, and even healthcare. In the EU alone, the sector accounts for 10% of GDP, employs 24.5 million people, and is projected to generate an additional 3.47 million jobs by 2034. With 3.2 million enterprises - 99.9% of them SMEs - tourism constitutes a cornerstone of Europe’s economy and society.

This growing relevance is now increasingly reflected in policy. For the first time, tourism has been elevated within the European Commission to form part of a dedicated portfolio: Sustainable Transport and Tourism. A new EU tourism strategy is also in development and scheduled for completion by mid-2026.

Who, then, holds the levers of power in today’s destination governance? And how can governance frameworks evolve to become more inclusive, capable, and resilient for the future?

Stakeholders and Power: A Delicate Balance

Destination governance encompasses a wide array of actors - each with distinct responsibilities, interests, and degrees of influence.

Local and regional authorities are typically on the front lines. They regulate visitor flows, manage public spaces, and absorb the social costs and benefits of tourism. Yet, their ability to shape outcomes is sometimes constrained by national policies or the actions of influential private actors.

National governments and EU institutions establish the broader legal and strategic context. Through regulation, infrastructure investment, and inter-regional collaboration, they play a vital - though at times distant - role in shaping destination development.

Private sector actors - from hotel operators to real estate investors and digital platforms - wield substantial economic influence and frequently shape tourism development in practice. In cities experiencing rapid growth in short-term rentals, the platform economy has introduced new and complex governance challenges.

Meanwhile, local communities - the residents who live in, work in, and shape destinations - often remain underrepresented. Although they experience the impacts of tourism most directly, their involvement in decision-making processes is frequently limited.

Amsterdam illustrates a shift in governance dynamics. In response to housing pressures, resident protests, and unregulated short-term rentals, the city implemented stricter caps on tourist accommodation, established a centralised permit system, and clarified enforcement responsibilities at the municipal level. Crucially, these measures were communicated as efforts to safeguard both urban livability and the quality of the visitor experience.

Competence and Authority: Who Gets to Decide?

Governance is not solely a matter of power - it is equally a question of competence. In many destinations, responsibilities are dispersed. Who is responsible for zoning decisions related to tourism development? Who oversees the regulation of digital platforms? Who coordinates mobility in high-traffic tourist areas?

The OECD’s Tourism Trends and Policies 2024 identifies fragmented governance as a central obstacle to advancing sustainable tourism transitions. Cities frequently lack the legal or institutional authority to enforce decisions or to coordinate across interconnected sectors such as housing, transport, and culture. At the same time, national frameworks may not sufficiently reflect local realities.

Effective governance models provide both clear mandates and mechanisms for collaboration. In Finland, Visit Finland cooperates closely with regional organisations and municipalities to implement national strategies in a manner tailored to local contexts. In Austria, regional tourism organisations are legally empowered to coordinate diverse actors under unified mandates, supported through public-private funding schemes.

Clear allocation of responsibilities becomes especially critical in times of crisis - whether during pandemics, environmental disruptions, or other shocks - where swift, coordinated responses are essential to safeguard both community wellbeing and the resilience of the tourism economy.

Making Governance Participatory

Community engagement is no longer a supplementary element - it has become a foundational principle of effective governance. Residents are increasingly demanding a voice in decisions that directly affect their quality of life. As cities transition from volume-driven tourism models to value-based approaches, participatory mechanisms are gaining prominence.

Barcelona has emerged as a leading example of participatory tourism governance. Since 2017, the city has implemented its Strategic Tourism Plan through a multi-stakeholder framework that includes citizens, experts, businesses, and district-level representatives. It has introduced tools such as local observatories, participatory budgets for tourism projects, and neighbourhood consultations. While consensus is not always achieved, the process fosters shared responsibility and enhances transparency in decision-making.

More broadly, cities across Europe are exploring innovative forms of public participation - including citizen assemblies, advisory councils, and digital consultation platforms. The EU Urban Agenda’s Sustainable Tourism Partnership actively encourages municipalities to embed such instruments into formal governance structures. The objective is to move beyond reactive consultation and toward proactive, co-creative governance.

Leadership and Political Will: The Missing Piece

Even the most well-designed governance frameworks depend on political will to become truly effective. Leadership at the local, regional, and national levels plays a pivotal role in initiating reforms, building alliances, and maintaining momentum.

Yet, political cycles often clash with the long-term horizon required for destination governance. Short election terms, populist pressures, and fear of backlash from powerful interests can delay or dilute necessary reforms. This is where vision and long-term commitment become essential.

The OECD emphasizes that bridging governance gaps requires more than institutional restructuring. It advocates for investment in leadership development, greater policy coherence across government ministries, and the establishment of independent monitoring bodies to ensure accountability among decision-makers.

Recent EU-funded initiatives such as D3HUB and Sustainable EU Tourism underscore the importance of leadership in testing and scaling new governance models. D3HUB, in particular, promotes destination management structures that integrate innovation and foresight into policymaking processes. These projects demonstrate that meaningful change is achievable - but only when clear ownership is taken.

Towards Regenerative Governance

Regenerative governance transcends conventional “green” approaches to tourism. It calls for the integration of tourism policy with housing, climate adaptation, cultural heritage, and social inclusion. What is needed are coordinated, long-term strategies - not isolated interventions.

The European Capitals of Smart Tourism initiative showcases how cities such as Valencia and Bordeaux are aligning tourism policy with broader urban regeneration efforts. These cities promote circular economy models, resident-led innovation, and equitable access to public space - placing community wellbeing at the centre of tourism development.

The forthcoming OECD policy paper Building Strong Tourism Destinations (developed from the Vienna workshop) is expected to offer further insights into how governance can support resilience and regeneration. Preliminary findings highlight the importance of cross-sector collaboration, multi-level governance, and strategic long-term planning anchored in local institutions.

Destination governance is no longer a backstage issue - it has become centre stage. In an era marked by climate volatility, digital transformation, and social tension, effective tourism governance is vital for the wellbeing of residents and the sustainability of local economies. It requires clarity in decision-making structures, inclusivity in participation, and steadfast political support.

Ultimately, strong governance is underpinned by a shared sense of purpose - one that sees destinations not merely as commodities to be consumed, but as places to be inhabited, cared for, and renewed.