Reducing the Burden on Small Public Companies Would Promote Innovation, Job Creation, and Economic Growth
by David R. Burton
The Heritage Foundation
June 23, 2014
Securities and Exchange Commission (SEC) regulations impose high costs on companies seeking to access the public securities markets. These costs are prohibitively high for small and medium-sized companies and impede their ability to access the capital needed to grow, innovate, and create jobs. Reasonable mandatory disclosure by public companies promotes capital formation and the efficient allocation of capital. However, both Regulation S-K and Regulation S-X, which govern public company disclosure, should be revised to reduce compliance costs by better scaling disclosure requirements and eliminating requirements that do little or nothing to protect investors.