Too many business interests are clinging to a failed status quo and resisting necessary governance reforms, the government's top securities regulator said Thursday.
William Donaldson, chairman of the Securities and Exchange Commission, made the remarks in a speech in New York to the Conference Board, an influential business executives' group and research organization.
Copies of the prepared text of his speech were released by the SEC in Washington.
Donaldson lauded the Conference Board for setting examples of "actions that can help to restore good business practices and public trust in companies, their leaders and the capital markets."
Public mistrust of Wall Street and corporate America remains high following the wave of business scandals, though doubts have been eased somewhat by SEC enforcement actions against hundreds of companies and by corporate improvements, in Donaldson's view.
"This erosion of trust in business is a serious and worrying development, and there's no guarantee the problem will automatically get resolved," he said Thursday night. While the SEC and other regulators can put clear rules in place, he added, "we know from the course of history that human nature will push aggressive managers and organizations to continue to test new laws."
Donaldson appealed to the Conference Board members to press other, more recalcitrant business organizations "to stay on the side of positive change."