The messy Mark Hurd affair at Hewlett-Packard has given rise to much discussion about the H-P board. Some have praised it for acting forthrightly. Many noted a Wall Street Journal article on how the board grew increasingly frustrated with what it deemed to be less than cooperative behavior from Hurd as the board's investigation rolled on. But others have criticized the board for rushing to judgment. One shareholder has sued the board because of its actions.

A commentary in TheStreet.com discusses the odd events in light of Sarbanes-Oxley's little-invoked Section 406--Code of Ethics for Senior Financial Officers, which includes the CEO. The rule basically requires that the company disclose whether there is a code of ethics that applies to these executives and when there has been a change in the code.

"As far as I know, Section 406 has never been enforced. That's a shame, because a total lack of enforcement has rendered this Enron-era law just about meaningless," the commentator writes. He thinks the law could be useful to prosecutors, especially considering that the conduct of many financial firms seem to violate their codes. In some cases, companies don't even have codes.

While the whole issue of Section 406 is unlikely to ever be something prosecutable, firms ought to rethink their codes and update their policies.

For more:
- here's the item
- here's the Wall Street Journal article
- a columnist criticizes the board for acting like cowards

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