Business Studies XI Content
Characteristics of public enterprises
- Government ownership: It is totally owned by government. Its majority shares are taken up by the government. In this enterprise, sometimes 50% of share is owned by the government.
- Government management and control: It is one autonomous body which is managed and owned by government. Government controls and manages organization by appointing key personnel. It is like board of directors, managing directors, chairman and so on which manage the appointing, transfer of members and so on.
- Public accountability: They are operated by government fund. It is also accountable to general public. It is carried out by the parliament and helps in providing goods and services for public.
- Service motive: It provides service to the public. It provides goods and services to the public at reasonable price. It is guide by service motive but it can earn nominal profit.
- Autonomous: It is one autonomous body which is managed and owned by government. It receives fund from the government. But government doesn’t interfere in the day to day activities of the organization.
- Monopoly: Government has monopoly in this sector.
- Separate legal entity: It is established under acts and is rum under a law. It can purchase and sell securities, can enter into any contract, can sue and can be sued.
- Stability: It is generally stable and perpetual in nature.