The Sarbanes-Oxley Act reduced agency conflicts by giving corporate managers greater flexibility to select their preferred candidates to the board of directors.

Question

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The Sarbanes-Oxley Act actually increased the independence of the board of directors and mandated that at least a majority of the board must be independent directors who are not employed by the company. This was done to reduce agency conflicts and increase accountability. So, the act did not give corporate managers greater flexibility to select their preferred candidates to the board of directors.

The Sarbanes-Oxley Act Reduced Agency Conflicts by Giving Corporate Managers