Sarbanes-Oxley (SOX) and Corporate Governance Overview
What is the Sarbanes Oxley Act?
- US law passed 2002 to strengthen Corporate governance and restore investor confidence.
- Sponsored by US Senator Paul Sarbanes and US Representative Michael Oxley.
- Passed in response to a number of major corporate and accounting scandals involving prominent companies in the United States.
- 11 sections ranging from additional Corporate Board responsibilities to criminal penalties.
What does Sarbanes Oxley Address?
- Sarbanes Oxley Act Establishes new standards for Corporate Boards and Audit Committees
- Sarbanes Oxley Act Establishes new accountability standards and criminal penalties for Corporate Management
- Sarbanes Oxley Act Establishes new independence standards for External Auditors
- Sarbanes Oxley Act Establishes a Public Company Accounting Oversight Board (PCAOB) under the Security and Exchange Commission (SEC) to oversee public accounting firms and issue accounting standards