Elements of Governance Reform Coursework Example | Topics and Well Written Essays - 500 words

Elements of Governance Reform - Coursework Example This act is the latest most effective regulatory reform intended to rectify major corporate misleads in future. Arthur Andersen LLP’s role in the revolutionary scandal of Enron is reflected in one important part of SOX Act which standardized requirements to ensure the independence of the auditors. Major failure in accountability and disclosure of few leading nonprofit firms and penetrated media coverage of this failure by nonprofit organizations cast the nonprofit sector in an unethical and unfavorable light. This also damaged the integrity and trust of people across the world on the nonprofit organizations along with the benefit of the nonprofits organizations. Although most of the provisions of Sarbanes Oxley Act have currently been applied to only publicly traded companies nonprofit organizations could benefit by adopting these provisions. Apart from this, voluntarily adhering to the Sarbanes Oxley Gold standards would generate more ability and credibility to appoint more e fficient members in the boards of nonprofit organizations. This also can attract many potential fund donors, foundations, and many other potential financial funding resources. The nonprofit sector that enjoyed light oversight and little regulations have now highly focused on the new demand for standardized corporate governance. If the nonprofit sector wishes to retain its higher extent of self-regulation, the board and top management of the organizations need to put accountable effort to improve the organizations in terms of corporate governance and financial transparency. If the current situation does not improve the whole sector may come down under unwanted regulations of government. Some attorneys general of states already criticized that additional SOCK provisions need to be applied to nonprofits.