Most video cameras have a “white balance” option for automatically adjusting their color response to ambient lighting conditions. If this option is switched off or not fully effective, the coloration of the video image will suffer.
Studio’s White balance effect corrects the problem by allowing you to specify which color should be taken as “white” in this image. The adjustment needed to make that reference color white is then applied to every pixel of the image. If the reference white is well chosen, this can make the coloration seem more natural.