Part of what made the peace prize something that was prestigious was it's quite strict definition. What you've seen over the last few decades is the politicisation of the award, using it to push fashionable causes and essentially leech off it's integrity. Of course, it only works for a while and after so many joke peace prize awards (Arafat? Obama? Gore?) is it really worth much anymore? I think the Scandinavians may be coming to that realisation.
The award was always very political; it’s perhaps inevitable given the terms of reference. Whose going to reduce standing armies or attend peace conferences, if not politicians? Indeed, if not politicians involved in conflicts? It’s the politicians involved in conflicts who are best positioned to end them, which is how Henry Kissenger and Le Duc Tho and Yasser Arafat and Yitzhak Rabin come to get prizes. And this is nothing new; Theodore Roosevelt won the prize in 1906 for his involvement in mediating a ceasefire in the Russo-Japanese war. His earlier role in bringing about the Spanish-American war was not mentioned.
I think the prizegiving committee has tended to recognise that standing armies are not reduced, and peace promoted, by nice people talking exclusively to other nice people.
What has changed, I think, is a growing recognition that international peace is not achieved simply by reducing standing armies and engaging in diplomacy, but by addressing the causes of conflict in the first place. Albert Schweizer won the price in 1952; George Marshall (of Marshall Plan fame) in 1953; the UNHCR in 1954. Albert Lutuli, president of the African National Congress, won in 1960 for being “in the forefront of the struggle against apartheid in South Africa”; Linus Pauling in 1962 for his campaigns against nuclear weapons. As the examples of Lutuli and Pauling show, it’s not necessary to achieve what you set out to achieve in order to win the prize; it’s enough that you raise awareness of an issue, and of its importance. Martin Luther King won in 1964, before the achievement of the Civil Rights Act. Norman Borlaug won in 1970, for scientific work which improved crop yields, and did much to bring to an end the chronic famines which had plagues parts of Asia for most of recorded history.
At times the prize has reflected more hope than achievement; the award to Barack Obama undoubtedly falls into this category, as does the 1976 award to Betty Williams and Mairead Corrigan.