Reforming Regulation of Corporate Governance

Networks Financial Institute Policy Brief No. 2006-PB-19

15 Pages Posted: 29 Nov 2006

See all articles by Kenneth Lehn

Kenneth Lehn

University of Pittsburgh - Finance Group

Multiple version iconThere are 2 versions of this paper

Date Written: November 2006

Abstract

Since the revelation of accounting scandals at Enron, Worldcom, and several other high profile companies ("Enron et al.") five years ago, there has been unprecedented public focus on U.S. corporate governance. A common view, articulated by many journalists, politicians, and public pundits is that these scandals were indicative of a crisis that eroded investor confidence in U.S. corporations. This paper makes the argument that the increase in resources allocated to securities enforcement and the substantial penalties meted out to executives convicted of accounting fraud have dramatically reduced the incentive to engage in Enron-like behavior.

Keywords: Corporate governance, sarbanes oxley regulation

JEL Classification: G34, G38, M41, M43, M49

Suggested Citation

Lehn, Kenneth, Reforming Regulation of Corporate Governance (November 2006). Networks Financial Institute Policy Brief No. 2006-PB-19 , Available at SSRN: https://ssrn.com/abstract=947897 or http://dx.doi.org/10.2139/ssrn.947897

Kenneth Lehn (Contact Author)

University of Pittsburgh - Finance Group ( email )

372 Mervis Hall
Pittsburgh, PA 15260
United States
412-648-2034 (Phone)

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