58 Int. J. Corporate Governance, Vol. 2, No. 1, 2010 Copyright © 2010 Inderscience Enterprises Ltd. The role of corporate governance during the pre- and post-Sarbanes Oxley periods Anthony C. Ng* School of Accounting and Finance, 7/F Li Ka Shing Tower, The Hong Kong Polytechnic University, Hunghom, Kowloon, Hong Kong E-mail: afang@inet.polyu.edu.hk *Corresponding author Yaw M. Mensah Rutgers Business School – Newark and New Brunswick, Dean’s Office Suite, 11th Floor, One Washington Park, Newark, NJ 07102, USA and Centre for Governmental Accounting, Education and Research (CGAER), Rutgers Business School – Newark and New Brunswick, Janice Levin Building, 94 Rockafeller Road, Piscataway, NJ 08854, USA E-mail: mensah@business.rutgers.edu Abstract: This study examines the joint effects of the passing of Sarbanes-Oxley Act (SOX) of 2002 and firm-specific corporate governance mechanisms on the value-relevance of earnings. We find that value-relevance of earnings is significantly different for different sub-periods. We find that good corporate governance (proxied by lack of anti-takeover provisions) has a positive impact on the value-relevance of earnings only during the scandal (SCA) period. These results hold after controlling for changes in institutional ownership and earnings quality (EQ). Our results suggest that there is a substitution effect between good firm-specific corporate governance mechanisms and the strictness of the regulatory environment. Keywords: corporate governance; earnings quality; EQ; value-relevance of earnings; Sarbanes-Oxley Act; SOX. Reference to this paper should be made as follows: Ng, A.C. and Mensah, Y.M. (2010) ‘The role of corporate governance during the pre- and post-Sarbanes Oxley periods’, Int. J. Corporate Governance, Vol. 2, No. 1, pp.58–86. Biographical notes: Anthony C. Ng is currently an Assistant Professor at the School of Accounting and Finance at the Hong Kong Polytechnic University. Yaw M. Mensah is currently the Senior Associate Dean for Faculty at the Rutgers Business School – Newark and New Brunswick, Rutgers – The State University of New Jersey, USA. He is also an Accounting Professor at the