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Rural development in developing countries, including Indonesia, will certainly relate to the issue of poverty reduction. One instance of the problem of poverty is rural economic governance institutions. In the perspective of the economic independence of the rural economy is an alternative institutional rational choice and unique , given the village often seen as a small, weak and underdeveloped. Therefore, to change the thoughts and views of the importance of a village in the emic perspective to try to strengthen economic institutions through village-owned enterprises (BUMDes). This study aims to explain the phenomena of the institutional. BUMDes the main issues of governance, BUMDes as actors or institutions (organizations) in order to continue to grow the economy This study used a qualitative approach through the method of phenomenology, the locus of the suburban rural areas in Malang, East Java Province, Ketindan village and Wonorejo village, District of Lawang, and Gondowangi village, District of Wagir. Background for the site selection studies have established institution with its main business BUMDes on water management in order to meet the needs of the villagers. The results of this research in theoretical and empirical perspectives (emic), shows that : (1). Institutional BUMDes refers to the maximization of utility as the goal, the maximization of profit (profit maximization), (2). The community of BUMDes Institutions are more likely to prioritize rationality villagers as a group, with social capital as the basis of individual interests and preferences; (3). BUMDes organizational structure that is outside the village government structures are not always stable and efficient in providing services to villagers., And (4). Villagers are assigned as officers and employees BUMDes more motivation and orientation based on the non-material, namely a sense of respect and appreciation socially and politically than economically. BUMDes institutions to put forward the goal of maximizing the usefulness of water for the fulfillment of (welfare) villagers, rather than maximizing profit for increased revenue village (PADes). BUMDes governance implementation based on the perspectives, preferences, and commodities are produced according to the

Economic Independence Of The Village Through Institutional Village Enterprises (BUMDes)