Same case with Enron. After the Enron scandal the Sarbanes - Oxley act was enacted to strengthen financial reporting practices along with a bunch of new modifications in the accounting principles and guidelines (GAAP).
The SOX Act was considered to be greatest and the most radical update in Accounting since the invention of the double entry method. Governance and stewardship was theorized in Accounting but they were pushed into practice with the SOX act.
Similarly we had the Dodd-Frank act post the financial crisis of '08.
Essentially law is a post-facto phenomenon. We can not be sure what to write into a legal framework unless there is an evidence for the need to such laws.
The SOX Act was considered to be greatest and the most radical update in Accounting since the invention of the double entry method. Governance and stewardship was theorized in Accounting but they were pushed into practice with the SOX act.
Similarly we had the Dodd-Frank act post the financial crisis of '08.
Essentially law is a post-facto phenomenon. We can not be sure what to write into a legal framework unless there is an evidence for the need to such laws.