Just this week, I asked one of my staff for the execution status of a contract.  As with everything else, I needed the contract executed by the vendor ASAP.  When it comes to the execution of contracts, I operate "electronically," and don't need wet signatures.

My staff responded that he had to send the contracts to the vendor in a hard-copy form for signature.  Since this is out of the norm for us, I quizzed my staff on why and why he couldn't quickly convince the vendor to ink the deal electronically.  My staff's response?  The vendor said they needed hardcopies of contracts with wet signatures because of Sarbanes-Oxley!  Really? So where exactly in the Sarbanes-Oxley Act of 2002 does it say that companies must have physical contracts with wet signatures!?  I feel sorry for that vendor's contracts staff...Their heads must explode when they have to buy software via click-through or shrink-wrap contracts.

I've heard a lot of lame excuses using SOX as the basis (usually around vendor revrec), but this is the first time I've heard it used like this.

I'm not sure if I could ever get that vendor's contracts staff to think outside of their dark little box, but we've had some other vendors that also wanted wet signatures that we've been able to convince otherwise.  In my mind, wet signatures are a waste of money (shipping back and forth), time (in transit and sitting on desks), and effort (good luck on trying to get a copy back).  With faxes or scanned images, there's lower cost, less time, and it's easier to be on top of whether you've gotten a counter-signed copy back.

To facilitate making a vendor's stubborn contracts staff at ease with faxed and scanned contracts, here's something I include in every contract template I have:


Spread the word to our less enlightened colleagues:  Welcome to the computer era—it's OK now to not have wet signatures.

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