Authority
Authority answers whether that Actor may perform a specific operation concerning a specific Subject, Principal, purpose, and context.
Specification-sourced: quoted from the governing specification, pending the applicable specification-owner approvals. The specification controls.
In plain words
A Person may be able to sign an agreement without authority to commit an employer, and a DigitalAgent may be able to execute a transaction without being authorized to. Authority may arise from direct control, governance position, Delegation, contract or Formation governance, and consequential operations should trace which basis was used.
What it is not
Authority ≠ Agency
Authority is whether an entity may perform an action in context; Agency is only whether it can. Authority Is Not Agency · Concept Paper (source: 01 §8.3)
Authority ≠ Capability
Authority is permission to perform an operation in context; Capability is what an entity can credibly do, and technical ability never implies permission. Authentication Is Not Authority · Canonical Model & Protocol (source: 04 §20.1)