Tighter corporate governance standards

Name: Tighter corporate governance standards

What: With the global economic environment being heavily influenced by the Sarbanes-Oxley Act of 2002, companies must comply with much more strict rules for how corporate governance. This impacts the operation of IT systems, and particularly how companies use the Internet.

Enablers: Sarbanes Oxley is driving companies to more closely define how they run their organizations.

Inhibitors: Some parts of Sarbanes Oxley – such as the phrase requiring companies to immediately report to investors any material events – are vague. (Material event has not been defined).

Paradigms: Sarbanes Oxley is the most influential legislation since the Securities and Exchange Act of 1934, and it applies to any company that is publicly listed on a US stock exchange. It is changing the way business is done in many industries, particularly in the finance discipline.

Experts: tax auditors, finance experts, and management consultants.

Timing: the Act was implemented in 2002. Compliance milestones are March 2004, Q12005, Year-end 2005, and 2006.

Web resources: Sarbanes Oxley Official Site, Gartner, IBM Business Consulting Services Institute for Business Value, Deloitte