New governance rules coming to exchanges.

• Author: Marshall, Jeffrey
• Position: Governance - Brief Article

Expect to see a gradual phase-in of new listing and governance rules for companies listing on the New York Stock Exchange and Nasdaq, a direct result of last year's Sarbanes-Oxley Act. New rules, in fact, were put out in late October by the two exchanges, though they might not be in effect until spring, says attorney Gordon Kaiser, a partner with Squire, Sanders & Dempsey in Cleveland.

Kaiser says that the rules--formally approved by the Securities and Exchange Commission in early November--have actually been late in coming, since the SEC has been trying to broker agreements with the two exchanges since it published rules in March. "Getting [the exchanges] in parallel is really important," he says.

"It's easier to talk about the change in terms of broad import of what the rules are, than any specific piece of them or the differences in what the exchanges are doing," Kaiser says. "At one level, it goes to core of Sarbanes-Oxley. It really boils down to the perception that some institutions in the corporate world, which the market or Congress...