Azure Management Groups provide a hierarchical structure for managing multiple Azure subscriptions under a single organizational umbrella, simplifying the administration and governance of resources. Introduced to enhance the cloud governance capabilities within Azure, management groups allow for the efficient application of policies, access controls, and compliance settings across a wide range of subscriptions. This organizationally scoped management layer serves as a critical tool in the Azure governance toolkit, enabling businesses to scale their operations and governance practices efficiently. By structuring subscriptions into a customizable hierarchy, organizations can apply governance conditions such as Azure Policy and Azure Role-Based Access Control (RBAC) settings at different levels, from the management group down to individual resources, thereby ensuring consistent governance and compliance enforcement across the entire Azure environment.