“…To redress the problem of corporate misconduct, ensuring sound corporate governance is believed to be essential to maintaining investor confidence and good performance. A growing number of empirical studies have demonstrated that good corporate governance contributes to better investor protection (la Porta et al, 2000), lower costs of capital (Ashbaugh-Skaife et al, 2004), reduced earnings manipulations (Xie et al, 2001), increased company market value (Black et al, 2004;Brown and Caylor, 2004), improved stock returns (Gompers et al, 2003;Bauer et al, 2003) and even economic growth (Maher and Andersson, 1999). In the UK, since the early 1990s, the problems concerning corporate governance have been addressed in a series of government reviews, beginning with the Cadbury Report (Cadbury, 1992), and then following with the Greenbury Report (Greenbury, 1995), the Hampel Report (Hampel, 1998), and finally the Combined Code (The Combined Code, 2003) (henceforth The Code).…”