November 3, 2005 | Posted By Diane Pfadenhauer | print this article

SOX in the Private Sector

Sarbanes-Oxley, although applicable to public sector firms, has begun to creep into the private sector.  According to a survey reported here:

  • 58 percent of the 1,400 CFOs at privately held firms who responded to the survey said their businesses were implementing new practices in response to corporate governance mandates for publicly held firms.
  • 37 percent cited "pressure to meet corporate compliance deadlines" as the greatest impact increased corporate governance had on business.

Looks as though the trend toward greater scrutiny on corporate governance is continuing.   Earlier this year I wrote an article for the Journal of Private Equity on the impact of this heightened scrutiny on board and senior management recruitment and retention.  My conclusion, it's gotten a lot harder and now it's looking like that difficulty will transfer over to the private sector as well as these firms adopt some of these standards.