Parental Control: The Impact Of The Sarbanes-oxley Act Upon Environmental Disclosurernrequirements Of Public Companies

摘要

SOX is a proverbial "swift kick in the pants" for lazy corporate management. While it does not create new substantive law for environmental compliance, it creates a more stringent and precise procedure for complying with currently-existing legislation. Increased penalties and standards of accountability compel management to stay abreast of environmental obligations and report them with accuracy to shareholders.rnPrudent corporations have long been adhering to environmental disclosure regulation. Yet research reveals that a majority of corporations do not submit meticulous environmental reports and have not made reporting a priority. The adoption of SOX raises the priority of environmental disclosure. Concededly, SOX has some air of coercion. The mention of it can evince sheer terror from accountants and sheer awe from corporate management who must employ experts to discover and enact all that SOX entails, specifically the development of internal controls.rnWhile from the corporate perspective, SOX may seem burdensome and overly broad, from an environmental point of view it may have been absolutely necessary. Historically, corporations have been lax about environmental issues. While SOX's long term repercussions remain unknown, if the Act forces some corporations to get into gear about environmental disclosure, it will have served its purpose of increasing the communication of corporate management with the environmental segments of the corporation and forcing management to abide by its duty to fully inform shareholders. One thing is certain, however: corporations must adopt a plan to comply with the legislation because it is not going away.