The Sarbanes-Oxley Act of 2002 often abbreviated to SOX is legislation approved by the

U.S. Congress in order to protect shareholders and the public related with the share
market from the various fraud practices and the accounting errors to improve the
corporate disclosures accuracy. The U.S. Securities and Exchange Commission (SEC)
administers the act, which sets deadlines for compliance and publishes rules on
requirements. These compliances and the set of rules have bounded the board of directors
to maintain the business ethics and social responsibility. The various elements of the SOX
which helped the board of directors to have relative thinking regarding to business ethics
and social responsibility are as follows:

CEO and CFO must officially state every report representing companys financial
statements.

There are restricted corporate control of executives, accounting firms, auditing

committees, and attorneys.

SOX has specified duties of registered public accounting firms that conduct audits of
the organization.

It has specified the composition of the audit committee and specific responsibilities
regarding the audit committee.

It has also set rules for attorney conduct.

SOX has stipulated the disclosure periods.

There are stricter penalties if the rules are violated by the company.

References
Pearce II, J. A., & Robinson, R. B. (2011). Strategic Management: Formulation,
Implementation and Control (12th ed.). McGraw-Hill Irwin