Bush Unveils Plan To Improve Corporate Disclosure

By Agence France-Presse President George W. Bush unveiled a plan March 7 intended to protect investors by requiring companies to issue more complete financial information faster and use improved accounting standards. The recommendations, consisting of a 10-point plan, are from the president's working group on financial markets created in the wake of the Enron collapse. "The whole design of free-market capitalism depends upon free people acting responsibly," Bush told a business group in Washington. "Business people must answer not just to the demands of the market or self interest, but to the demands of conscience." Among its recommendations, the plan calls for corporate officers to disclose to the Securities and Exchange Commission their purchases and sales of company stock within two days. A senior administration official said some of those disclosure requirements are currently as high as 40 days. Bush said the new requirements would be enforced by the SEC. Bush's proposal seeks to aid investors but would not increase legal requirements of chief executives as previously proposed by some members of Congress and the administration, including Treasury Secretary Paul O'Neill. The task force that drafted the plan includes officials from the SEC, Treasury Department, Federal Reserve and the Commodity Futures Trading Commission. The recommendations came in the wake of an outcry for improved oversight on corporate reporting and accounting in the wake of the meltdown of Enron after disclosures that it hid massive amounts of debt off its records. In a related matter, SEC chairman Harvey Pitt said his agency plans to reform its enforcement practices to provide better protection for investors, and called on Congress to provide budgetary increases for more staff. Copyright Agence France-Presse, 2002