Law Review presents first symposium on corporate reform BY JACQUELINE J. HARRINGTON More than 200 students, professors and business professionals attended the Michigan State DCL Law Review’s first symposium of the 2003-2004 academic year. Titled “In the Wake of Corporate Reform: One Year in the Life of Sarbanes-Oxley—A Critical Review,” the symposium, held on September 19, was led by some of the nation’s most prestigious law and business scholars and corporate executives. “The Law Review and MSU-DCL gave a very good symposium on the Sarbanes-Oxley Act, the most important securities legislation since the 1930s,” said David Westbrook, State University of New York-Buffalo professor and symposium panelist. “By bringing such a wealth of perspective to focus on a relatively limited field, the symposium showed a way for the Law Review to amplify its contribution to national policy disclosure.” The symposium provided a critical analysis of the successes and failures of the Sarbanes-Oxley Act passed on July 30, 2002, in the wake of the Enron and WorldCom corporate scandals. With the goal of combating future massive corporate fraud, the act takes specific actions to achieve greater corporate accountability and transparency for company executives, boards of directors and independent auditors. “The Law Review is always trying to bring the hottest topics in the legal profession to MSU-DCL,” said Law Review Managing Editor Chris Lucas. “By hosting the symposium a year after the Sarbanes-Oxley Act was passed, we were able to analyze changes in corporate law and to see how those changes have been implemented.” Reviewing Sarbanes-Oxley a year after its inception not only gave the Law Review a better perspective of the successes and failures of the act, but also allowed time to recruit top corporate professionals and scholars. “Coupled with the backing of the law college and the determination of our members, the symposium was one of the Law Review’s greatest successes, greatly enhancing the reputation of MSU-DCL,” said Lucas. The symposium offered a mixture of theory and practice, including speakers from the University of Illinois, the University of California-Los Angeles, Notre Dame and Penn State as well as executives and partners from Ford Motor Credit, Warner Norcross & Judd, L.L.P., of Grand Rapids, Michigan, and PricewaterhouseCoopers of Detroit. “The Sarbanes-Oxley symposium was a great forum for the affected lawyers, accountants and corporate executives to come together,” said Dave Cosper, chief financial officer for Ford Motor Credit. “It was fascinating to hear points of view from the legal and academic worlds and compare them with what I see every day in business.” Papers by conference presenters will be published in the Summer 2004 issue of the Michigan State DCL Law Review. Copies will be available from the Law Review office at 517/432-6930. The Sarbanes-Oxley Act of 2002, signed into law by President George Bush on July 30, 2002, was enacted in response to the Enron, WorldCom, Global Crossing and other very public corporate scandals as the market bubble of the 1990s burst. The Act addresses numerous topics and numerous parties (such as accountants, officers, directors, attorneys, and securities analysts) over its 69 separate sections and 66 pages. It also requires the Securities and Exchange Commission to promulgate rules with respect to certain subject areas. Since its enactment, commentators have debated whether the Act in fact instituted fundamental change or merely created the perception of change, and whether corporate attitudes will be altered permanently or temporarily. At this writing, it is still too early to draw conclusions about the long-range impact of the Act. However, it is likely that if the Act proves to have a significant impact, among the provisions that will have contributed to this result are the following. • Creating the Public Company Accounting Oversight Board to regulate the accounting profession, including registering public accounting firms; establishing auditing, quality control, ethics, independence and other standards; and conducting investigations and disciplinary proceedings. • Requiring the Securities and Exchange Commission to promulgate rules setting forth minimum standards of professional conduct for attorneys appearing and practicing before the Commission, a matter that has traditionally been left to the states. • Protecting “whistleblowers” through new criminal penalties and a private right of action for compensatory damages. • Limiting accounting firms’ ability to perform non-audit services for public companies. • Regulating corporate insiders by, inter alia, prohibiting personal loans, requiring enhanced certifications, requiring forfeiture of bonuses under certain circumstances, and prohibiting trades during pension fund blackout periods. —Analysis provided by Professor Elliot Spoon, November 2003 “By bringing such a wealth of perspective to focus on a relatively limited field, the symposium showed a way for the Law Review to amplify its contribution to national policy disclosure.” Symposium Panelists Larry C. Backer, Professor, Penn State University Stephen Bainbridge, Professor of Law, University of California-Los Angeles Matthew J. Barrett, Professor of Law, Notre Dame School of Law David P. Cosper, Chief Financial Officer, Ford Motor Credit. Marilyn Johnson, Associate Professor of Accounting, Michigan State University Peter Kostant, Professor of Law, University of Connecticut Hugh H. Makens, Partner, Warner Norcross & Judd, L.L.P., Grand Rapids, Michigan Mark Matthews, Partner, PricewaterhouseCoopers, Detroit Brett McDonnell, Associate Professor, University of Minnesota Lisa H. Nicholson, Professor, University of Louisville Richard Painter, Professor of Law, University of Illinois Larry Ribstein, Professor of Law, University of Illinois Davis Westbrook, Professor, State University of New York-Buffalo