Greenspan: Dump SarbOx

September 26, 2006 from eWeek.com – “The Sarbanes-Oxley Act is doing more harm than good and must be overhauled, Alan Greenspan told a technology audience here.

"One good thing: Sarbox requires the CEO to certify the financial statement. That's new and that's helpful. Having said that, the rest we could do without. Section 404 is a nightmare." Greenspan's remarks came at a meeting of the Massachusetts Technology Leadership Council here on Sept. 25. Greenspan was Chairman of the Federal Reserve board for 18 years, having retired in early 2006.

He said the evidence is clear that Sarbanes-Oxley strictures are driving initial public stock offerings away from the New York Stock Exchange and to the London Stock Exchange. Increasingly, he said, people recognize that Sarbanes-Oxley must be changed. "The pressure on getting 404 significantly altered is rising and is taking on a critical mass." But he added, "You do not get a bill altered when the two names [Sarbanes and Oxley] are in the process of retiring. People are waiting until they are gone. Then, hopefully, changes will be made. Any bill that passes both houses almost unanimously, cannot be a good piece of legislation."

180 View – We think it’s time Sarbox (or the equivalent) reviews include efficiency (achieve the desired result with the minimum use of resources) and effectiveness (achieve the desired result). Then we are talking about value for the money.