A new study from economic experts in the US counters the argument that the Sarbanes-Oxley legislation is resulting in an exodus of companies listed on the New York Stock Exchange (NYSE) to London, with experts stating that the Sarbanes-Oxley Act has had little real impact in this regard.
According to the study, authored by experts at Ohio State University and the University of Toronto, more stringent corporate governance rules as stipulated by Sarbanes-Oxley are not responsible for any mass departure of NYSE firms to London.
Instead, the study suggests that there are simply fewer companies of the type that would typically pursue an NYSE listing.
In addition, according to the Independent, the study also levels criticism at an ongoing campaign to dilute Sarbanes-Oxley. The legislation, introduced in response to the bankruptcy of Enron, is believed by many to be inflating the cost of being listed in the US while also deterring international firms from the NYSE.
Bilateral regulation concerns
The interaction of European and US-based accounting standards has been in the news recently as Christopher Cox, chairman of the US Securities and Exchange Committee, announced that the creation of new, mutual standards has been "going swimmingly", according to MarketWatch.
As the US and European markets have become increasingly integrated, so too have the complexities regarding accounting standards for companies operating in both regions - something the new regulation will aim to address.
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