-Principle based (In the UK, TheUK corporate governance code): These consist of principles, which should befollowed unless there is a justifiable explanation as to why not.

*Leadership

*Effectiveness

*Accountability

*Remuneration

*Relationship with shareholders

-Rule based (In the USA, theSarbanes-Oxley): This provides a set of rules which must be followed in allcircumstances and it includes punishment for non-compliance.

In the UK, corporate governance has been developed through a number ofcodes that have been endorsed by the stock exchange. Such codes are:

-The Cadbury report (1992):Recommend a code of best practice

-The Greenbury report (Early1995): Focused on directors pays

-The Hampel report (1998): Produce acombine code of principles of good governance and best practice

-The Higgs report (2003): Recommendchanges to the combined code to require a greater proportion of   independent, better informed non-executivedirectors on the board

-The smith report (2003): Maderecommendations with regards to audit committees.