In 2002 President Bush passed the Sarbanes–Oxley Act and with that one stroke of the pen spawned a new industry in the United States: online Document Management.  Sometimes viewed as a sub sector of enterprise document management (ECM) systems, electronic document management helps businesses keep track of their documents, helps them comply with the Sarbanes–Oxley Act, and improves efficiency.

In a nutshell, the Sarbanes–Oxley Act set new standards and rules for the way publicly traded businesses keep financial records.  It was a response, in part, to the Enron accounting scandal where investors lost millions of dollars due to stocks falling after scandals were exposed.

Where does document management fit into this political event?Public businesses now have to maintain tight control over accounting procedures like stock transactions involving corporate officers.  Internal controls are now required, and reporting to various oversight agencies is much more demanding on businesses who are traded publicly.  Document management has become crucial to a business that wants to operate within legal boundaries.

Businesses now must deal with enhanced financial reporting requirements, more intense audits of their financial records, and complex laws on conflict of interest and securities.  Non compliance can now carry criminal charges.  That’s a very big motivator for a company to procure a document management system that helps them track, store, and retrieve documents efficiently and properly.