Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Tuesday, November 22, 2011

A New Survey Reports the Costs of Going Public

It is commonplace to state that there is a high cost to going public, and the costs of compliance with SEC regulation, in particularl Sarbanes-Oxley 404, are usually blamed for those high costs.  A recent Ernst & Young survey points to another source:  increased compensation paid to officers, directors and advisors.  The survey (which is described in a recent post) looked at data from 26 companies that went public in the last two years and reports that being public adds about $2.5 million, on average, to costs, with $1.5 million attributable to higher compensation for CEOs, CFOs and others in the finance function, as well as increased board costs., The True Costs of Being Public: More Than You Think

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