This document draws on the 'Upside-down' synthesis report and presents the key policy messages in a summarised form. Based on a ten year programme of DFID-funded research by the Centre for the Future State, the central message is that achieving better governance is not a precondition for development but an integral part of the development process. States and societies help to build each other. Bargaining between the state and society – between people who hold political/military power and organised social groups – is fundamental to achieving progressive change: more peaceful resolution of conflict, more productive investment of resources, and more inclusive public goods. Understanding how these domestic political processes play out in a particular country context, and how they are influenced by external interventions, is key to improving the effectiveness of aid-funded development efforts. Instead of top-down programmes to impose Western institutional models and best practice, donors should focus more on local capacity and local political processes, and look for ways of building on them.