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Corporate Collapse - The demise of Enron - Essay Example

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Enron Corporation was considered as American fast growing commodities, energy, and service Company but the fate of the company was not good and it was bankrupted on 2nd December 2001 (Bratton, & Levitin, 2013). There are many reasons behind the failure of the company; some…
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Corporate Collapse - The demise of Enron
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Download file to see previous pages The duration of the project that was expected by the company was 10 years and the company expected that it will generate huge amount of profit from this project. But the reality is opposite to what Enron forecasted and it had to bear huge loss in terms of finance and social image (Ahmed, 2012). The project was considered as the largest direct foreign investment project in India’s history but it became debacle for Enron because many countries criticized Enron for its poor performance and fake promises (Bettauer, 2009).
Enron’s liquefied natural gas power plant development project stated in 1992 in Maharashtra state of India. It was supposed to fulfill India’s energy need with more than 2000 megawatts of electricity (Ahmed, 2012). But due to various issues like dispute over prices between India’s government and Enron and criticism of Indians on this project turned the venture into an example of what can go wrong when two different cultures collide in a large scale development project (Bajaj, 2010). The project became debacle for Enron because it produced no electricity and in 2001 the company got bankrupted.
Enron Corporation in 1992 proclaimed that it would develop a natural gas power plant worth of $3 billion in Dabhol western state of Maharashtra, India. The project was expected to be the poster child of India’s economic liberalization but unfortunately it became the symbol of project failure and people consider it as a human rights nightmare and an economic failure.
The project was subject of criticism from the beginning. The company worked hand in hand with dishonest Indian bureaucrats and politicians in order to complete the project but Indian public interest group filed charges against Enron and in 1993 Indian Reliance Company bribed Indian petroleum minister to secure the contract (Leuz, & Schrand, 2009). Due to this bribery ...Download file to see next pagesRead More
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