Thank you, Mr. Chairman, for holding this hearing. I want to welcome Mr. Donaldson before the committee and congratulate him on his nomination.
Mr. Chairman, though Mr. Donaldson was kind enough to pay me a courtesy visit last week, I didn't need that meeting to become convinced of his vast knowledge of our nation's financial markets. I've known Mr. Donaldson for quite some time, and he's always been an innovator and a leading thinker within the securities community.
Those characteristics and the skills acquired from years spent at the company he co-founded - Donaldson, Lufkin and Jenrette - his tenure at the New York Stock Exchange and his time as a public company CEO give Mr. Donaldson a wide array of experiences from which to tap into should he move forward to become next chairman of the Securities and Exchange Commission.
If confirmed, Mr. Donaldson would take the helm of an embattled agency. His first task will be to restore investor confidence after a year plagued by corporate fraud and accounting scandals. The efforts he will immediately undertake at the agency will go a long way towards determining his success or failure at restoring that confidence.
Those include finding a strong, credible individual to lead the new Public Company Accounting Oversight Board and overseeing the rule-making process for implementation of the Sarbanes-Oxley Act. Mr. Donaldson will also need to devote considerable attention to restoring the morale amongst SEC employees and fighting to make sure that the agency receives the funding it has been promised by President Bush's in his FY '04 budget and by the Congress.
Over the long run, I look forward to seeing how Mr. Donaldson seeks to turn his vision of a new SEC into a reality. That vision will play a significant role towards ensuring whether America's capital markets - in the face of growing global competition - remain the heart of global capital formation.
Mr. Chairman, the U.S. capital markets have, in many ways, provided the fuel for the expansion of the global marketplace. Domestically and abroad, they have driven the economic growth that has been at the heart of technological, economic and cultural change throughout the world. In doing so, our capital markets have grown stronger, more liquid and more adaptable to ever-changing and dynamic global economic conditions.
To remain strong U.S. markets must pursue innovative thinking and risk-taking which, coupled with transparency and effective regulation, will ensure the integrity of a system that investors will continue to view as a fair, reliable place to do business.
To be certain, the challenges facing the SEC are enormous. Fortunately, Mr. Donaldson will be equipped with considerably more human and technological resources than those before him have had. The Sarbanes-Oxley legislation provides a statutory framework that should enable his success, as will new funding for the agency.
The rest, as they say, will be up to him.
Mr. Chairman, I look forward to Mr. Donaldson's testimony before the committee, and should he be confirmed, to assisting him in any way I can. And Mr. Donaldson, I again congratulate you.
Thank you, Mr. Chairman.