Critics of Sarbanes-Oxley have long argued that foreign companies will forego U.S. listings to avoid compliance costs. While the theory may have some intellectual appeal, year-to-date statistics show that the exact opposite has occurred. According to a recent WSJ article, foreign firms have sold $5.8 billion worth of stock so far this year in U.S.-listed initial public offerings, more than any year since 2000.
Why have foreign companies embraced U.S. markets? According to the CEO of one such company, it is precisely because Sarbanes-Oxley and other compliance reforms have restored the perception that U.S. exchanges are the gold standard among capital markets. Neerah Bhargava, CEO of India-based business process outsourcing company WNS Holdings Limited explained in a separate WSJ editorial that his company decided to list on the NYSE because it “is important for clients and investors to view our organization as a trusted, well-run and compliant company.”
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