WASHINGTON, June 3, 2004 (PRIMEZONE) -- The CEO Council, a non-profit organization advocating the interests of small public companies, today applauded Melinda Ligos for her article, "When Going Public May Not Be Worth It", that appeared in today's edition of the New York Times (NYSE: NYT).
Citing the surging costs of Sarbanes-Oxley and the increasing number of companies electing to de-list from public status, the article validates previous claims made by the CEO Council that over-regulation of small public companies is hurting the investing public rather than protecting it.
"Sarbanes-Oxley in its present state is not good for small public companies or their shareholders," said Drew Connolly, Investor Committee Director for the CEO Council. "Instead of growing their businesses and hiring more employees, management is now forced to spend its time and a burdensome amount of capital to pay for compliance. The result is lower shareholder values and less liquidity for investors. This law was written to protect investors but it does the exact opposite for small company investors. It defies logic and changes must be made soon."
Steve Crane, CEO Council Director and Chairman of CorpHQ Inc. (Pink Sheets:COHQ), added: "The Council supports sound corporate governance and increased investor protection as championed under Sarbanes-Oxley. At the same time, though, we believe the regulations need to be 'right-sized' for small business in order to prevent unintended consequences on jobs, shareholder value and access to expansion capital."
The CEO Council has spent extensive time and effort over the past year asking Congress to reform the regulatory environment for small public companies, and is continuing its attempts to engage the House Financial Services Committee and Senate Banking Committee for a congressional hearing.
"So far, our concerns and the supporting evidence have been well received by certain members of Congress," said Ian Park, Legislative Director for the CEO Council. "But some lawmakers are resistant to change, even for the sake of the engine of our economy, small business. Nevertheless, we are making progress and remain hopeful that a hearing will be held within the next year."
About the CEO Council:
The mission of The CEO Council is to provide a common voice and platform for officers and directors of public companies, and enable them to more effectively interpret and participate in the corporate governance and regulatory process to ensure compliance, to safeguard shareholder value and to clearly demonstrate a dedication to fair and ethical business practices.