If 11 September 2001 is the date when the world changed, then 14 August 2002 might be the day when a new order began in US business.

That is the day when the Securities and Exchange Commission (SEC), the administrative body and watchdog that oversees US stock markets, began forcing the chief executives of nearly 1,000 big American companies to sign a document that, only a few years ago, they would have refused to even look at: when they present their latest financial figures, they must not only swear a personal oath that the figures are comprehensive, accurate and in no way misleading, but they must also attest that the figures they have already presented to Wall Street in recent financial filings are “materially truthful and complete”.

To many observers, it may not seem too draconian for a CEO to sign such a legal document. But buried in a heap of proposed changes are some important details that will have at least some CEOs lying awake at night.

These amount to one thing: company officers of public company’s will have to sign a pledge that nothing that might be “important to a reasonable investor” has been left out of a filing. And if they don’t do so, they could, in the words of one lawyer, “go to jail and owe lots of money.”

Morever, the new rules state that is not even enough to bring all the information to the attention of the investing public. Such information must now be disclosed at the earliest opportunity, and it must be discussed in the up front “management discussion and analysis” section of corporate reports. (Enron disclosed off-balance sheet liabilities in subsidiary filings and footnotes.)

Another new element is that executives must make it their job to know about, and disclose, all operational issues that might ultimately be of relevance to investors. It will not be enough just to be up-to-speed with the accounts.

All of this has put the wind up corporate America, with many executives saying that President Bush, who is behind many of the changes, has gone too far and that talented individuals will steer away from taking executive posts at public companies. Some are comparing it to the McCarthy period or the Salem witch trials.

The government, however, believes that corporate accounting is now a political issue. Certainly, by any historical standards of corporate governance, this is an unprecedented step that regulators, even many Democrats, would once have found both unnecessary and unacceptable. In fact, just four years ago, in 1998, US executives easily fought off an attempt by the SEC to get them to sign a similar declaration when they filed each new earnings report.

The technology industry is particularly concerned, with many executives saying that it is now been unfairly scrutinised. For every guilty company, such as WorldCom, Global Crossing and Peregrine Systems, there have been an equal number of companies that have been investigated but found not guilty of wrongdoing, such as IBM, Microsoft and Computer Associates.

During the 1990s, dozens of technology companies faced a raft of expensive ‘class action’ lawsuits alleging that they had misled investors. These lawsuits will not only become more common, say experts, but executives will often be personally liable. Lawyers acting for investors will now seek redress from the companies themselves and from executives, directors and officers of insurance underwriters, investment banks and auditors.

Philip Lay, managing director of the Chasm Group, an advisor to high-tech companies, is one of those who thinks that the US government has overreacted. “Public company management could turn into a legal-liability nightmare for executives,” he says, “each of whom will run the risk of going to jail at the first signs of an accounting slip. This type of exaggerated reaction may well drive precious talent away from corporate leadership.”

Investment banks, already doing their best to adjust to some tough new regulations, are also concerned. They fear that, even if the markets recover, non-US companies will avoid listing on Nasdaq because of personal liability; and that more entrepreneurs will sell their companies rather than subject themselves to the rigours of corporate office.