Slipping back to business as usual: Six months after the passage of Sarbanes-Oxley

When it passed in the summer of 2002, the Sarbanes-Oxley Act was hailed as the most significant reform legislation of the markets since the Great Depression. An initial flurry of activity, including several high profile arrests, suggested that the accounting profession and Corporate America generally were in for a heightened level of scrutiny and enforcement. But politics and missteps by the White House and SEC have cooled the enforcement climate considerably and a return to historically low levels of investor confidence may just be around the corner. Given the current environment, it is incumbent on shareholders, particularly institutional investors, to assert leadership for restoring confidence to the markets. They have the resources and Sarbanes-Oxley provides the tools for them to pick up the slack and take on a more aggressive private enforcement role.