From Halopedia, the Halo wiki
A confederation is an alliance, union, or league.
The European Union on the human homeworld of Earth is a democratic confederation. The Unified Earth Government (UEG) was supposed to be a confederation of independently governed planets, however the interference of the United Nations Space Command (UNSC) made many Outer Colonies and some Inner Colonies doubt this.
The Covenant were also a confederation of multiple species.