Under the Sarbanes-Oxley Act of 2002, all members of a publicly traded corporation's audit committee must be outside directors.

Sarbanes-Oxley Act

A federal law established in the United States in 2002 that aims to safeguard investors through the enhancement of the precision and dependability of company reports.

Outside Directors

Board members who are not part of the company's day-to-day operations, providing independent oversight and insight.

Publicly Traded

Refers to a company whose shares are available for purchase by the general public on a stock exchange.