Forms of

business
Organizations
•Single or Sole
proprietorship
•Partnership
•Corporation
•Cooperative
Single or sole
proprietorship
• A business unit where the manager
is also the owner
• Simplest form of business
organization recognized by the law
• the easiest to set up
Partnership
• Article 1767 of the civil code - “Two
or more persons bind themselves to
contribute money, property, or
industry to a common fund with the
intention of dividing the profits
among themselves”
• Must have a lawful object or
purpose, and must be established
for the common benefit or interest
Partnership
• To assure its lawfulness,
partnership as a form of business
organization, with a capital of
P3,000 or more must be registered
to Security of exchange
commission.
• Bus. Partnership is not limited to
common business. It includes as
Corporation
• “An artificial being created by
operation of law, having the right of
succession and the powers,
attributes, and properties expressly
authorized by law or incident to its
existence.”

• Just like partnership they are

required to register in SEC where it
Corporation
• This kind of business can either be
a stock or a non-stock corporation.

There are Three Main advantages of

incorporating the business
– Limited Liability
– Financial resources
– continuity
“The higher the
buildings, the
lower the morals”
Noel
Coward
Cooperative
Fundamental principles
• Voluntary and open membership
• Democratic member control
• Economic participation
• Autonomy and independence
• Education, Training and
information
Cooperative
Fundamental principles
• Cooperation among cooperatives
• Concern for community
Business and
Socioeconomic
development
Advantages
• Improvement of our standard of
living
• Creating employment
• Main enhancer of the
entrepreneurial mind (The mind
for innovation and creativity)
• It Helps the government and
other social agencies in
responding to the basic needs
• Challenge and change the
common practices of a
particular society.
• Occupies a key role in our
nation’s socioeconomic
development.
The downside of
business
• Business is caught in a
paradoxical role –
“perfecting nature while
destroying it.”
The Core
Principles of
Good corporate
governance
• Corporate Governance –
is the system by which
businesses are directed
and controlled.
• Good corporate
governance is a key
factor in underpinning the
Fairness
• Fairness refers to equal treatment.
• There should also be fairness in
the treatment of all stakeholders
including employees, communities
and public officials.
Accountability
• Corporate accountability refers to
the obligation and responsibility to
give an explanation or reason for
the company’s actions and
conduct.
Accountability
• The board is responsible for
determining the nature and extent
of the significant risks it is willing to
take.
• The board should maintain sound
risk management and internal
control systems
• The board should communicate
Transparency
• A principle of good governance is
that stakeholders should be
informed about the company’s
activities, what its plans to do in
the future and any risks involved in
its business stragies.
SEAT WORK
• Discuss the other possible advantages and
disadvantages of the various forms of business
organization.

• Do you agree with Noel Coward’s observation

that the “higher the building, the lower the
morals.” Why or Why not?

• Discuss the other adverse effects of business

institutions on the environment, the equality of
opportunities available to people, and cultural
values. As students, what can you do to resist
these adverse effects?