SOX after Ten Years: A Multidisciplinary Review

Harvard Law and Economics Discussion Paper No. 758

86 Pages Posted: 23 Oct 2013 Last revised: 29 May 2014

See all articles by John C. Coates, IV

John C. Coates, IV

Harvard Law School; European Corporate Governance Institute (ECGI)

Suraj Srinivasan

Harvard Business School

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Date Written: January 12, 2014


We review and assess research findings from 120 papers in accounting, finance, and law to evaluate the impact of the Sarbanes-Oxley Act. We describe significant developments in how the Act was implemented and find that despite severe criticism, the Act and institutions it created have survived almost intact since enactment. We report survey findings from informed parties that suggest that the Act has produced financial reporting benefits. While the direct costs of the Act were substantial and fell disproportionately on smaller companies, costs have fallen over time and in response to changes in its implementation. Research about indirect costs such as loss of risk taking in the U.S. is inconclusive. The evidence for and social welfare implications of claimed effects such as fewer IPOs or loss of foreign listings are unclear. Financial reporting quality appears to have gone up after SOX but research on causal attribution is weak. On balance, research on the Act's net social welfare remains inconclusive. We end by outlining challenges facing research in this area, and propose an agenda for better modeling costs and benefits of financial regulation.

Keywords: SOX, Sarbanes-Oxley Act, Regulation, Fraud

Suggested Citation

Coates, John C. and Srinivasan, Suraj, SOX after Ten Years: A Multidisciplinary Review (January 12, 2014). Harvard Law and Economics Discussion Paper No. 758, Available at SSRN: or

John C. Coates

Harvard Law School ( email )

1575 Massachusetts
Hauser 406
Cambridge, MA 02138
United States

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels

Suraj Srinivasan (Contact Author)

Harvard Business School ( email )

Soldiers Field
Boston, MA 02163
United States


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