The Sarbanes-Oxley Act was passed in 2002, as a reaction to media-enhanced investor-debacles. The law of unintended consequences was the ultimate result.
Negatives by far outweigh any positives Sarbanes-Oxley has been a great profit center for accounting firms. It’s also a good talking and campaigning point for populist politicians, but an expensive headache for companies.
Lots of smaller corporations no longer seek public funds because it has become too expensive for them to be publicly owned. Audits are too expensive. That causes havoc among small business which cannot afford the added costs..
What’s more, the legislation helps little in preventing fraud, the intended purpose. Moreover, this keeps foreign corporations, even giants, out of the U.S. or has existing ones reconsider their American status.
If any corporate executive wants to commit fraud, Sarbanes-Oxley will not prevent collusion to do so. On the other hand, anyone with corporate experience (that leaves out most in Congress) knows that Sarbanes-Oxley makes running a business more like a steeplechase or handicap than it should be.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)
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