So far Boards' role was limited to promoting transparency and accountability. However, given the complexities of present day business environment, Boards should be involved in strategic decision-making as well.

The year 2002 was a watershed year in the history of Corporate Governance (CG). In 2002, many companies including WorldCom and Global Crossing in the US and Marconi, Vivendi and ABB in Europe filed for bankruptcies. Who can forget the demise of Enron, the Texas-based energy-trading giant and once the seventh biggest company in the US. In most of these cases, lack of good governance was cited as the main reason for bankruptcy. One of the boards of these companies turned a blind eye when a CFO used innovative financial engineering models for his own benefits; others remained silent when bad strategies were formulated or bad acquisition made. But is it not the responsibility of the corporate boards to ask questions and raise issues whenever there is an iota of doubt regarding the work of the CEO and the other members of the top management; be it in strategy formulation or in accounting issues.

OECD defined CG as "a system by which business corporations are directed and controlled. The corporate governance structure specifies the distribution of rights and responsibilities among different participants in the corporation, such as the board, managers, shareholders and other stakeholders, and spells out the rules and procedures for making decisions on corporate affairs. By doing this, it also provides the structure through which the company objectives are set, and the means of attaining those objectives and monitoring performance."

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