It began as a mandate, but smart companies have turned it to better advantage; SOX as part of a larger controls and risk management strategy vindicated
As the Sarbanes-Oxley Act (SOX) goes into its second year, the market is seeing evidence that what began as a mandate is providing a springboard for plenty of business value.
Process experts like IDS Scheer and others have emphasized the ability of SOX to be just one component of a larger risk management strategy, and, according to a forthcoming CFO Research Services survey sponsored by PricewaterhouseCoopers (PwC) and Virsa Systems, executives are catching on.
If you think back to the days in which many executives were on record as saying that SOX was unnecessarily onerous, it's a kind of victory to observe that half of the surveyed executives now realized that inadequate corporate governance and controls end up being punished by dropping share prices. A third of respondents made the next logical leap, suggesting that good governance and controls are eventually rewarded with a premium in share prices.
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