McNealy slams Sarbanes-Oxley
Get your hands out of my pants
Neither IBM, Intel nor Microsoft has what it would take to drive Sun Microsystems' CEO Scott McNealy out of the tech industry, but Uncle Sam does.
McNealy last week told The Register that legislation aimed at corporate reform has CEOs feeling like the government has put an uninvited hand in their pants. The Sarbanes-Oxley Act of 2002 has made life so uncomfortable for top executives that McNealy warned it may start to undermine the fundamentals of how business is conducted in the good old U.S. of A.
"I mean Sarbanes-Oxley is the equivalent of the police pulling every car over and doing a full-body cavity search whether they have reason to worry or not," McNealy said in an interview. "You know who is losing out? It's the shareholders. Hundreds of millions if not billions of assets are being spent on accountants now. Unfortunately, there are civil liberties for people, but we have no organization protecting civil liberties for corporations and their shareholders."
Tell us what you really think, Scott.
McNealy is not alone with gripes about Sarbanes-Oxley. Companies small and large have complained that the tighter accounting regulations are a financial drain.
Regulators came up with Sarbanes-Oxley, hoping to avoid embarrassing accounting incidents such as the great Enron debacle and the WorldCom fiasco. The legislation calls for more thorough documentation and also has led to an increase in insurance costs for company directors, looking to cover their tails.
Wall Street certainly needs a whipping, but as McNealy and others argue, there is an unfair assumption of guilt hovering over all companies in the post-Enron world.
"It's the folks out there who are trying to submarine the American Way that gets me," McNealy said. "Whether it's expensing stock options or limiting pay for performance or inspecting every law abiding citizen."
McNealy has long fought to keep the government at arm's length from big business and says that too much intrusion could be enough to take the fun out of being a CEO.
"You know, as long as the politicians don't make it so un-fun, I'll stick around," he said. "That's the only part of the industry that would drive me out."
It's hard to imagine what the government would have to do to force McNealy's hand. He has, after all, been competing against Microsoft in one way, shape or form for more than thirty years.
McNealy and Microsoft CEO Steve Ballmer attended rival high-schools in Michigan and then later attended Harvard at the same time.
When asked about their shared fondness for sports, McNealy said, "Yeah, we both like to compete, but I've always played sports, while Ballmer just managed."
It's that kind of combative persona that makes McNealy's departure from Sun anytime soon seem highly unlikely even if the Feds are flashing a rubber glove. ®