Making Audit Committee Disclosure More Transparent Requires Investor Feedback

The role of the audit committee in a company’s board of directors has changed significantly since the passage of the Sarbanes-Oxley Act of 2002 (SOX). Traditionally, audit committees have overseen the company’s independent auditor, the internal audit function, and other financial reporting-related functions. More recently, many audit committees have taken on additional oversight responsibilities, such as overseeing enterprise risk management (ERM), environmental, social and governance (ESG) reporting, and cybersecurity.

Since these additional responsibilities are not explicitly required by SOX or the Securities and Exchange Commission (SEC) and are not assigned uniformly in all boards, stakeholders must rely on boards … Read more