Robert J. Jackson, Jr. is a Commissioner at the U.S. Securities and Exchange Commission. This post is based on his recent public statement. The views expressed in the post are those of Commissioner Jackson and do not necessarily reflect those of the Securities and Exchange Commission, the other Commissioners, or the Staff.
Thank you, Mr. Chairman, and thank you to the Staff in the Division of Corporation Finance, including John Fieldsend, Elizabeth Murphy, Felicia Kung, Lindsay McCord, and Director Bill Hinman, for their work in developing today’s release. I also appreciate the efforts of my colleagues in the Division of Economic and Risk Analysis, especially Director SP Kothari, Chyhe Becker, and Tara Bhandari.
Today [May 9, 2019] my colleagues propose to roll back the requirement that auditors attest to the adequacy of certain companies’ internal controls. The proposal’s analysis of the costs of attestation is based on data that’s over a decade old, and the proposal makes no real attempt to assess the investor-protection benefits of gatekeepers in our markets. Having conducted my own analysis using data from today’s marketplace, it’s clear that this proposal has no apparent basis in evidence. Accordingly, I respectfully dissent.
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In the wake of the Enron and WorldCom accounting debacles that cost American families more than $85 billion, Congress passed the Sarbanes-Oxley Act, requiring companies, executives, and auditors to comply with new rules to restore public trust in our markets. SOX changed corporate oversight across America, making directors and auditors a more independent, meaningful check on executives.
