There is a thin line between moral responsibility and legal culpability. No top corporate executive should assume the posture of Enron former chairman Ken Lay that he had no direct knowledge of massive and systematic financial fraud committed by subordinates. To accept the position of corporate chairman is to accept direct responsibility for the accuracy and honesty of all financial statements. That is why the U.S. Congress felt compelled to adopt the Sarbanes-Oxley Act for public company accounting reform and investment protection. The act has set deadlines for corporate chief executives to legally vouch for the contents of official financial statements.But he may also feel like the luckiest man in the world because he has been allowed to throw off the heavy burden of running CA to return to his roots as a technologist. It may prove to be the best thing that ever happened to CA, if it means that the company will be able to refresh its product line with technology that will keep it on a growth path. To achieve this goal, CA cannot afford to miss this opportunity to fix, once and for all, the deceptive accounting practices that have cast a pall over its prospects. Instituting permanent financial reforms will allow the company to focus on selling enterprise software, rather than dealing with the fallout of financial malfeasance investigations. Read why eWEEK.com Enterprise Applications Center Editor John Pallatto believes CA needs an outsider at the helm. The election of independent director Lewis Ranieri as chairman is a good first step. But the selection of the next CEO will be more critical in solving the companys problems. CA co-founder Russell Artzt, executive vice president, has been mentioned as a possible CEO candidate along with the companys new chief financial officer, Jeff Clarke. Clarke was recruited in April from Hewlett-Packard Co. and, as such, he may bring in an outsiders point of view that CA needs to resolve its problems. But it may still prove best to bring in another outsider to lead the company while supervising Clarkes efforts to permanently fix CA accounting practices. Check out eWEEK.coms Enterprise Applications Center at http://enterpriseapps.eweek.com for the latest news, reviews, analysis and opinion about productivity and business solutions. Be sure to add our eWEEK.com enterprise applications news feed to your RSS newsreader or My Yahoo page:
Kumar is apparently lucky that the final Sarbanes-Oxley compliance deadlines havent passed, or he might become one of the first corporate chairmen prosecuted under its provisions.