Smaller public companies are bemoaning the impact of Sarbanes-Oxley but many closely held private companies are adopting it as a system of governance, reports The Wall Street Journal.

The WSJ details some of the reasons: some see it as doing the groundwork for their company to go public, others see it as bringing in business from public sector companies or lucrative Government contracts.

It also documents a study which found that strengthening internal controls, and showing the company is less of a credit risk, would help it raise money more cheaply.

The influence of Sarbanes-Oxley is not only spreading into the private sector.

Paul Firstenberg, who will be teaching governance of nonprofit organisations at Yale School of Management, has a piece in onPhilanthropy.com where he outlines steps nonprofits should take for cleaning up their own system of governance and making themselves more accountable.

And some measures, like audit committees with independent directors, controls on how many other services the outside auditor provides the organisation, and whistleblower protections, are SOX-inspired.