Buy essay on The Enron Company

The Enron Company was formed in 1985 by the merger of two companies: Houston Natural Gas with Internorth (Charles E. Boyle). As a result it became one of the biggest providers of energy not only in the USA but in the world. The company took its leading position due to the capitalizing on the revolution in technology to pioneer trading energy products online (Charles E. Boyle). A lot the shareholders of the company became very rich people, but the management, officers and the directors became even richer. The company expanded its activity far beyond gas and electricity spheres. In the best company’s time the daily transactions comprised $2.5 billion. In two years this digit grew to $880 billion. Besides, Enron was winning different types of awards for numerous business innovations, and many experts stated that it was going to make even more success.
The collapse of the Enron Company became a shock for the whole commercial and financial world. It became the “century’s most infamous, with reverberations being felt around the world” (HR crisis management: an Enron case study). Before its bankruptcy in 2001 it was one of the leading companies in the USA. Enron was the US 7th largest company and its revenues comprised US$139 ($184) billion and employed approximately 30,000 people in more than 20 countries around the world (HR crisis management: an Enron case study). However it was characterized as a decentralized financial structure with almost no coherent process of decision-making. As a result it was next to impossible to understand clearly the essence of the corporation activity.
When the collapse of the company took place, the company’s shareholders were so outraged that the Enron’s bankruptcy resulted in 12 investigations made by the US Congress.
In most cases a company usually creates an “estate”. This estate includes all of the property interests of the debtor corporation (Stephen J. Weiss). If the proceeds of the D&O policy are considered to be the property of the estate, they appear to be subject to the jurisdiction of the bankruptcy court. They may not be able to pay the defense costs of the officers and the directors. In the case of Enron bankruptcy this point became the issue of many arguments. The intention of the Enron Company was to oppose the outside director’s motion and to defend themselves against numerous lawsuits. Long time before these trials when the company prospered, its representatives claimed (though not officially but in oral form) that Enron has millions of dollars to cover all the damage in case of bankruptcy.
It was November 2001 when the official representatives of the company stated that the financial statement in the company is far from ideal. Enron’s financial situation was estimated wrong and had to be restated. Several Enron’s insurers asserted that their policies “were issued based upon material misrepresentations by Enron” (Stephen J. Weiss). They stated to be bound by their policies no more.
The first step to recovery from bankruptcy was to reorganize the company’s internal resources. Besides, there was also an intention if the leaders of the company to demonstrate the world that something is being done about the problem rather than let everybody know that Enron lies in ashes.
Communicating with the employees of the company was another issue to deal with, as there appeared to be many outraged people who were left without their workplaces and therefore money for living. The insurance of the company concerning this point appeared to be not as strong as it was considered before the crisis. Besides communicating with the shareholders was not very successful too, as a lot of people “invested not only financially, but personally” (HR crisis management: an Enron case study).