What Sarbanes-Oxley Hath Wraught
Aaah, the magical soothing balm that is government regulation!
The delightfully titled Now Batting for Pedro Borbon blog (“Manny Mota...Mota...Mota”) reveals the (predictable) results of governmental efforts to “increase transparency” in the business world:
“We’re from the government, and we’re here to help you,” indeed...
Regardless, it seems to me that this is yet another opportunity to reflect on the importance of maintaining ethical business practices in both large and small corporations. As you recall, Sarbanes-Oxley was the congressional response to the various Enron-Worldcom type business accounting scandals in the late 90’s. Those scandals - a result of a distinct lack of ethical practices - resulted in a lot of people losing a lot of money, public distrust of corporations, and a resulting governmental response to the public outcry. The final links in this chain of events include massive new costs for businesses in order to comply with the new regulations, and now the phenomenon noted above. In other words, everyone loses. Returning to and reinforcing core ethical principles, however, creates a situation in which everyone can win.
The delightfully titled Now Batting for Pedro Borbon blog (“Manny Mota...Mota...Mota”) reveals the (predictable) results of governmental efforts to “increase transparency” in the business world:
So, let’s review. The law that was supposed to ensure greater transparency and make the stock market safe for all of us, especially the little guy, is driving companies to purge the little guy, become less transparent, and shun our world-class public capital markets.
Score another beaut for the Great Sausage Factory!
“We’re from the government, and we’re here to help you,” indeed...
Regardless, it seems to me that this is yet another opportunity to reflect on the importance of maintaining ethical business practices in both large and small corporations. As you recall, Sarbanes-Oxley was the congressional response to the various Enron-Worldcom type business accounting scandals in the late 90’s. Those scandals - a result of a distinct lack of ethical practices - resulted in a lot of people losing a lot of money, public distrust of corporations, and a resulting governmental response to the public outcry. The final links in this chain of events include massive new costs for businesses in order to comply with the new regulations, and now the phenomenon noted above. In other words, everyone loses. Returning to and reinforcing core ethical principles, however, creates a situation in which everyone can win.
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