Business Ethics and

Social
Responsibility
 Legal Forms of Business
Organizations
(Compare and Contrast)
 Variety of
Number of People
Type of Business Main Government Businesses That
Needed to Be
Organization Agency Involved May Be Engaged
Registered
In
Department of Trade Broad, any legal
Sole Proprietorship One
and Industry business
Securities and Broad, any legal
Partnership More the one Exchange business as long as
Commission partners allow
Securities and Limited to what
Corporation At least 5 Exchange articles of
Commission incorporation state
Cooperative Primary limited to
Cooperative At least 15 Development what articles of
Authority incorporation state
 Distinction of
Type of Business Control of the
Ownership owners’ and
Organization Business
business’ assets
Full control of the
Sole Proprietorship One No distinction
owner
Limited control of
Partnership Two or more No distinction
partners
Assets or corporation
Control and voting
is separate and
Corporation At least 5 power dependent on
distinct from those of
shares of stocks
the owners
Assets or corporation
Democratic control; is separate and
Cooperative At least 15 one member, one distinct from those of
vote policy the owners
 Profit and loss (p/l) Lifespan of the Implications or
Type of Business
distribution business Remarks
Organization
Easiest to organize
Broad business
transactions
Most numerous
Business “dies” with the
Sole Proprietorship All p/l goes to the owner Smallest in size
owner or if not renewed
High mortality rate
Tendency for
unprofessional
management
Relatively easy to
organize
Generates more
P/L distribution is
Business dependent on investments (cash,
dependent on p/l
Partnership the willingness and/or life property, etc.)
agreement in articles of
of the partners Easily dissolved
partnership
Usually better
management than sole
Type of Business Profit and loss (p/l) Lifespan of the Implications or
Organization distribution business Remarks
Harder to organize;
Profits distributed in 50 years by law subject requires legal
proportion to to renewal; ownership procedures
Corporation ownership of shares of is transferable via Tends to have biggest
stocks, subject to several trading of shares of investments
considerations stocks Professional
management
Easier to organize than
corporation
Greater benefits to
50 years by law subject member-owners but
to renewal; life is limited profit sharing
Cooperative
distinct and separate Easily grows in assets
from members and membership
Trends towards
professional
management