Have boards of directors changed? A study of the impact of Sarbanes-Oxley legislation on corporate governance.

摘要

The intent of The Sarbanes-Oxley Act of 2002 was to make extensive financial reporting reforms in publicly traded companies that would reduce financial statement misrepresentation or falsification. Although a few sections of the law address board of directors, the impact of the law on certain aspects of corporate governance is not currently known. The purpose of this quantitative research is to determine whether the Sarbanes-Oxley Act of 2002 impacted corporate governance at companies comprising the Dow Jones Industrial Average in terms of structure and composition. Corporate governance is viewed from the perspective of boards of directors. In this research, board structure involves three components: chief executive officer duality (or board leadership structure), board size, and the number and type of committees. Board composition, in this research, is comprised of the ratio of independent directors and the age, gender, race, and functional experience of the board members. In this relational study, variables relating to structure and composition were collected twice--both pre- and post-Sarbanes-Oxley--and compared to determine the law's impact.;This study provides evidence that corporate boards at component companies on the Dow Jones Industrial Average have decreased in average size, have more outside members, have increased in average age, and more are using Governance committees. Additionally, directors on these boards are more likely to be retired or current corporate chief executives or professors in academia and less likely to be on the executive team in academia or on the management team in law, entertainment, or an entrepreneurial pursuit. This study provides no evidence that Sarbanes-Oxley impacted chief executive officer duality, the number of board committees, or gender and racial demography on boards of directors at Dow Jones Industrial Average component companies.;This investigation contributes to the body of knowledge in that it provides evidence regarding specifically how one law impacted the structure and composition of boards of directors at some of the largest publicly traded companies in the United States. More generally, this research provides some insight into how legislation may impact how large corporations govern themselves.