From: Sandy Hentges
The Austin Chamber joined Chambers from Boston, San Francisco and Raleigh calling for changes to the Sarbanes-Oxley Act (SOX) for small and mid-cap publicly traded companies. A study completed by Abt Associates, Inc. of Boston identified a number of areas of SOX that disproportionately imposes a significant burden on smaller publicly traded companies.
The report submitted to the Securities and Exchange Commission (SEC) acknowledges the positive effects of SOX, but cautions that it has unnecessarily hampered the growth of the nation’s innovation economy. The report outlines key recommendations for changes by the SEC that would reflect the intent of SOX – to prevent, detect, and punish corporate fraud – while removing unfair obstacles for companies that are climbing toward the goal of going public. The Greater Austin Chamber is concerned about the long-term impact of the law. The economic vitality of our communities and nation are tied to the sustainability of our small business. The Greater Austin Chamber strongly opposes the negative impact SOX could potentially impose on small businesses. Sabernes-Oxley is inadvertently jeopardizing the viability of those same businesses by imposing on the disproportionately large costs and putting them at a competitive disadvantage globally. In effort to avoid such consequences, the Greater Austin Chamber supports the following recommendations:
1. Establish small company criteria: The SEC should clearly define what constitutes a smaller public company—using market cap and revenue breakpoints that are well understood.
We appreciate the efforts of the SEC in their current process to keep the legislation’s intent intact. Please feel free to contact me should you have any further questions regarding this matter.