Wharton Profs on Softening Sarbox: Proceed with Caution

Lora Bentley

At first glance, this Knowledge@Wharton piece looks like yet another rundown on the race to revamp Sarbanes-Oxley.


You know how they usually go. It starts with "The pro-Sarbox side argues..." and then rattles off the list of good things the law has helped to bring about. Then it moves on to "Detractors, however..." and recites just why those folks think Congress should scrap the law completely.


The list of parties involved in the fight doesn't change much, but some players have been known to switch sides. Finally, the article closes with an acknowledgement that the Securities and Exchange Commission and the Public Company Accounting Oversight board are working together to streamline Sarbanes-Oxley compliance requirements in a way that will substantially cut costs.


The Knowledge@Wharton writer, however, brings out a point that isn't highlighted all that often, and we think it's key to a successful resolution of the issue: "[F]inding the right mix of cutting costs while protecting investors may not be simple," but that doesn't mean that investor protections should be sacrificed in the name of cutting costs.


Hopefully lawmakers and regulators will keep that in mind as they proceed.

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