The rise of Enron took ten years, and the fall only took...

The rise of Enron took ten years, and the fall only took twenty days. Enron’s fall cost its investors $35,948,344,993.501, and forced the government to intervene by passing the Sarbanes-Oxley Act (SOX) 2 in 2002. SOX was put in place as a safeguard against fraud by making executives personally responsible for any fraudulent activity, as well as making audits and financial checks more frequent and rigorous. As a result, SOX allows investors to feel more at ease, knowing that it is highly unlikely something like the Enron scandal will occur again. SOX is a protective act that is greatly beneficial to corporate America and to its investors. Enron was formed following a merger between two natural gas companies in 1985, Houston Natural Gas and†¦show more content†¦However, Enron did not stop there. Enron continued to find new ways, and innovations to get ahead in the competitive market place. Skilling decided it best to invest in many companies and support their research in exchange for most a percentage of the profit the companies made through their idea. Clearway9 was one of the companies that Enron invested in and paid two million dollars quarterly to support. Clearway’s new idea that had Enron interested was its plan to turn bandwidth a commodity. The internet during the time of 1990’s and early 2000’s was a rapidly expanding venture. Though, the amount of bandwidth supplied to households and companies computers was not nearly enough, and was growing thinner as more and more people accessed the internet.10 Clearway had an idea to set up HUBs all over the country, and sell their bandwidth to homes and companies, which was significantly faster. Enron decided to contact Clearway and make a contract to support the company, in exchange for a percentage of its profits. Chris Ricci11 was Clearway’s general counsel and head/vice president of human resources, also the one sent to negotiate the contract with Enron. Chris Ricci, while speaking with Enron executives in a conference room, stated that he did not understand the business layout, â€Å"When I was negotiating the investment deal for Clearway, I sat across from various senior executives from Enron, and when I asked about their business model, I could notShow MoreRelatedHbr When Your Core Business Is Dying74686 Words   |  299 Pagesacross border s, the engine of innovation is ignited, prosperity is fueled and the energy available to everyone inc reases. At the same tim balancing the needs of e, producers and consum ers is as crucial as increa sing supply and curbin g demand. Only then wil l the world enjoy e nergy peace-of-mind. Succeeding in securing energy for everyone doe sn’t have to come at the exp ens start to think differently e of anyone. Once we all about energy, then we can truly make this promise a reality. $15Read MoreMerger and Acquisition: Current Issues115629 Words   |  463 PagesRaymond Thà ©oret and Franà §ois-Éric Racicot 4.1 4.2 4.3 4.4 4.5 Introduction The structures of the two merged banks The new merged bank A low P/E ratio for the stock of national bank Conclusion 42 42 43 50 53 54 5 Corporate Diversification: The Costs and Benefits of Synergy Felipe Balmaceda 5.1 5.2 5.3 5.4 5.5 5.6 Introduction Related literature The model The analysis Robustness Conclusion 56 56 58 60 64 67 73 6 The Influence of MAs on Firm Value: The Turkish Experience M. Nihat SolakogRead MoreLibrary Management204752 Words   |  820 PagesTransformational/Transactional Leadership . . . . . . . 332 Situational or Contingency Models of Leadership . . . . . 332 Fiedler’s Leadership Contingency Model . . . . . . . . . . . 333 Path-Goal Theory of Leadership . . . . . . . . . . . . . . . . . 333 Leadership in the Twenty-First Century . . . . . . . . . . . . 337 The Leadership Challenge . . . . . . . . . . . . . . . . . . . . . . 338 Developing Leadership. . . . . . . . . . . . . . . . . . . . . . . . . 340 15—Ethics . . . . . . . . . . . . . . . . . . . . . . . Read MoreOrganisational Theory230255 Words   |  922 PagesUniversity, UK McAuley et al. provide a highly readable account of ideas, perspectives and practices of organization. By thoroughly explaining, analyzing and exploring organization theory the book increases the understanding of a field that in recent years has become ever more fragmented. Organization theory is central t o managing, organizing and reflecting on both formal and informal structures, and in this respect you will find this book timely, interesting and valuable. Peter Holdt Christensen, Associate