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- Title
Corporate Objectives--Maximizing Social versus Private Equity.
- Authors
Zalewski, David A.
- Abstract
Many scholars will declare someday that 2002 was the year of the corporate scandal since it was during this time that some of the most egregious examples of executive greed in history were revealed. Because the once-respected heads of large corporations such as Merrill Lynch, Enron, and WorldCom enriched themselves at the expense of other stakeholders, the public's faith in unfettered capitalism was shaken. In response, leaders ranging from populist politicians to the president of the New York Stock Exchange demanded corporate governance reforms to restore confidence in the free market system. Acting with uncharacteristic swiftness, the U.S. Congress passed and President George W. Bush signed into law the Sarbanes-Oxley Act in July 2002. Because this legislation was based on the assumption that the offending acts were isolated cases of individual deviance, the Act created a federal task force to police illegal behavior, threatened CEOs with criminal penalties, and required executives to certify their financial statements. As of late 2002, however, many of the Act's programs either had not been carried out or were inadequately funded by Congress. Even if lawmakers had been more resolute in this regard, however, its potential effectiveness is questionable. The basis for this opinion is that the recent scandals reflect a systemic flaw in contemporary capitalism.
- Subjects
UNITED States; CORPORATE corruption; INDUSTRIAL management; CAPITALISM; COMMERCIAL crimes; CORPORATE governance laws
- Publication
Journal of Economic Issues (Association for Evolutionary Economics), 2003, Vol 37, Issue 2, p503
- ISSN
0021-3624
- Publication type
Article
- DOI
10.1080/00213624.2003.11506599