Corporate governance is commonly understood to be the system and processes by which a company is directed and is founded on virtues of accountability, integrity, transparency and fairness. It is wider than control which stands for regulation or exertion of authoritative influence, and describes a continuum – the process of exercising authority in which oversight assumes a more subtle meaning.

Whilst the concept of corporate governance is as old as the ‘principalagent problem’, the term was rarely used and, arguably, understood before the 1990s. Since then, there has been much attention and focus by regulators, boards and investors alike on the way in which companies are managed and led, in an attempt to identity and codify good corporate practices and behaviours.

There is a growing body of analysis and study dedicated to illuminating the link between good corporate governance and corporate success, in the form of financial and share price performance and a company's ability to raise cheap capital. The findings of the Global Investor Opinion Survey undertaken by McKinsey in cooperation with the Global Corporate Governance Forum in 2002 indicate that investors consider corporate standards on a par with financial indicators when evaluating investments. In addition, an overwhelming majority of respondents indicated their willingness to pay a premium for a company with high corporate governance standards.