The Sarbanes-Oxley Act (SOX) of 2002 is a landmark piece of legislation that transformed corporate governance and financial reporting. Named after its sponsors, Senator Paul Sarbanes and Representative Michael Oxley, this act was enacted in response to major corporate and accounting scandals, including those at Enron and WorldCom.

SOX compliance primarily focuses on four key areas: 1. Financial Reporting: Companies must maintain accurate financial records and implement internal controls to ensure the reliability of financial reporting. 2. Internal Controls: Organizations must establish and maintain effective internal control structures and procedures for financial reporting. 3. Executive Accountability: Senior management must personally certify the accuracy of financial statements and internal controls. 4. Whistleblower Protection: The act provides protection for employees who report fraudulent activities.

SOX compliance has significantly impacted Governance, Risk, and Compliance (GRC) roles: - Internal Auditors: Focus on evaluating and testing internal controls - Risk Managers: Assess and mitigate financial reporting risks - Compliance Officers: Ensure adherence to SOX requirements - IT Professionals: Implement and maintain control systems These roles are crucial in maintaining SOX compliance and preventing financial fraud.

Organizations often face several challenges in maintaining SOX compliance: - Documentation Requirements: Maintaining detailed documentation of controls and processes - Resource Allocation: Dedicating sufficient resources to compliance activities - Technology Integration: Implementing and maintaining effective control systems - Cost Management: Balancing compliance costs with business objectives