A Florida State University finance professor says the Sarbanes-Oxley Act will soon be taking its leave, reports Insurance News Net.
Bruce Haslem makes his prediction after reviewing information collected from 762 publicly traded companies just after Sarbanes-Oxley was enacted. His conclusion?
[C]ertifying a company's financial earnings statement is "a non-event" making no difference to investors.
That's why Congress should up the penalties for corporate fraud and executive wrongdoing, but do away with the rest of Sarbanes-Oxley's requirements, he suggests. In fact, Haslem says the act will "go away" in the next administration, if not before the current one draws to a close.
He calls the certification requirement "a marginally valuable addition" to corporate governance, and as such, it seems, not worth the high cost of compliance.
Maybe I'm missing something, but if the requirement that CEOs sign off on company financial filings is the problem, would it not make more sense to get rid of that one requirement and leave the rest of the act intact?