Private, Public and Global Enterprises

It is established under a special act passed in parliament or state legislative assembly.
Its objectives, powers and functions are clearly defined in the Statute /Act.
Examples include Unit Trust of India, Life Insurance Corporation of India, Steel
Authority of India Limited etc.
Features

• It is established under a special act which defines its objects, powers and functions.
• It has a separate legal entity.
• Its management is vested in a Board of Directors appointed or nominated by the government.
• It has its own staff, recruited and appointed as per the provisions of act.
• This type of enterprise is usually independently financed. It obtains funds by borrowing from government or from public or through earnings.
• It is not subject to same accounting and audit rules which are applicable to Government Department.

Merits

• Internal autonomy: It enjoys a good deal of autonomy in its day to day operations and is free from political interference.
•  Quick decisions: It can take prompt decisions and quick actions as it is free from the prohibitory rules of government.
• Parliamentary control: Their performance is subject to discussion in Parliament which ensures proper use of public money.
• Efficient management: Their Directors and top Executives are professionals and experts of different fields.

Demerits

• Flexibility is for name sake only: In reality, there is not much operational flexibility. It suffers from lot of political interference.
• Lack of profit motive: Usually they enjoy monopoly in their field and do not have profit motive due to which their working turns out to be inefficient.
• Corruption: Where there is dealing with public, rampant corruption exists. Thus public corporation is suitable for undertaking requiring monopoly powers e.g., public utilities.