The Unexpected Benefits of Sarbanes Oxley

coverThe April 2006 issue of the Harvard Business Review has an article by Stephen Wagner and Lee Dittmar on The Unexpected Benefits of Sarbanes Oxley.

Although the article is somewhat dated when it talks about the second year under Sarbanes Oxley, it foretells some of the current thoughts in compliance. Compliance is good for business. Two and a half years later, the Madoff scandal illustrates the need to be more transparent to your investors and for investors to look closer at their investments. Documenting business process and putting controls in place will make your business run better.

Good governance is a mixture of the enforceable and the intangible. Organizations with strong governance provide discipline and structure; instill ethical values in employees and train them in the proper procedures; and exhibit behavior at the board and executive levels that the rest of the organization will want to emulate.