The price of honesty--Sarbanes-Oxley Act of 2002.

• Author: Madden, Jim
• Position: Manage your assets

Like many corporations, your publicly traded company has been a rather late and disgruntled adopter of the tough corporate compliance rules established by the Sarbanes-Oxley Act of 2002. You've struggled to meet the provisions of Section 302, already in effect, which covers detailed certification of quarterly financial statements. But Section 404, which holds executive management responsible for their company's internal control system, is all about you!

In order to receive your stamp of approval, AMR Research estimates that Fortune 1000 companies will spend $2.5 billion on Sarbanes-Oxley compliance this year. We turn to those immersed in the complexities of this effort for guidance. How are they planning to approach compliance? Are they planning to use outside help, or is this something to be done internally? If they outsource part of the processes they are certifying, does it make it easier or harder? Contact: jim.madden@exult.net

Don Tapscott

President, New Paradigm

Learning Corporation

Sarbanes-Oxley is just the tip of the transparency iceberg--passive, forced compliance for financial disclosure Smart firms actively embrace transparency as a powerful new force in business that reaches far beyond just financial information. People and institutions that interact with firms are gaining unprecedented access to all sorts of information about corporate behavior, operations and performance. Armed with new tools to find information about matters that affect their interests, stakeholders now scrutinize the firm like never before, informing others and organizing collective responses. The corporation is becoming naked.

Customers can evaluate the worth of products and services at levels not possible before. Employees share formerly secret information about corporate strategy, management and challenges. To collaborate effectively, companies and their business partners have no choice but to share intimate knowledge with one another. Powerful institutional investors today own or manage most wealth, and they are developing x-ray vision. Finally, in a world of instant communications, whistle-blowers, inquisitive media and Googling, citizens and communities routinely put firms under the microscope.

Corporations have no choice but to rethink their values and behaviors--for the better. If you're goIng to be naked, you'd better be buff! Embrace transparency, rather than fighting it.

Contact: don.tapscott@tapscott.com

Geney D. Gibson

Senior VP Global Finance...