Ucsp Handout 4

NON-STATE INSTITUTIONS
Non-state institutions are those owned by private individuals. Their concern is mostly
that of individual welfare or that of a group of individuals.
1. Banks
Banks are financial institutions playing a great role in the economic growth of a nation.
Banks serve as intermediaries between those with excess funds and those who need funds.
Banks accept deposits from individuals who view these as their savings or investments.
Meanwhile, businesspeople go to banks to borrow money to grow their business.
While majority of banks in the country are privately owned, there are few which are
owned by the state. Apart from performing specialized functions, these government-owned
banks serve as depository of the state from which payment of salaries of public officials and
other expenditures are drawn.
2. Corporations
The Corporation Code of the Philippines define a corporation as 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.
Corporations are organizations created by people known as shareholders or

stockholders. A corporation is an artificial person created by operation of law. It takes a
personality that is distinct and separate from the shareholders or stockholders.
Having an artificial personality means that a corporation is accorded certain rights and
privileges similar to that of a natural person such as owning property in its name and having
the right to sue and be sued.
A corporation can be established for profit or non-profit purposes. The majority of

corporations you see around you were created for profit objectives. The businesses you see
at the town proper selling variety of goods and services are mostly owned and operated by
corporations. The non-profit ones were created for educational, religious or charitable
purposes. Examples of this are schools, orphanages and home for the aged and the
homeless.
Corporations contribute to the development of economic activities through efficient and

effective production and distribution of goods and services.
3. Cooperatives
The Cooperative Development Authority (CDA) defines cooperative as an autonomous

and duly registered association of persons, with a common bond of interest, who have
voluntarily joined together to achieve their social, economic and cultural needs and aspirations
by making equitable contributions to the capital required, patronizing their products and
services and accepting a fair share of risks and benefits of the undertaking in accordance with
the universally accepted cooperative principles.
A cooperative is an enterprise established by members who contribute money to a

common fund called share capital. Members are joint owners of the cooperative. The members
are also the primary clients of the cooperative as they should be the first to patronize the
products and services of their cooperative. At the end of the year, the profit of the cooperative
is distributed equitably among its members depending on their capital. What are the common
services of a cooperative? In farming communities, a farmer’s cooperative is established to
assist farmers plant, harvest, process and sell their products by providing needed machinery
and infrastructure. In cities, we commonly see credit cooperatives. Here, loans for productive
and providential purposes are extended to members.
Cooperatives are very similar to corporations in almost all aspects. Membership in both
are voluntary. Both organizations require members or shareholders to contribute money
known as their share capital. The amount contributed is basically the basis for profit distribution
in an equitable manner.
Both organizations has a Board of Directors in charge of policymaking. They are

elected by popular votes of all the members. The difference lies in the way members the Board
of Directors are elected. For cooperatives, one member is entitled to one vote only regardless
of capital contribution. Meanwhile, for corporations, the number of votes is proportionate to
the number of shares a member has.
While corporations are created either for profit or non-profit objectives, cooperatives
are for profit only.
4. Trade Unions
Trade unions, labor unions or labor organizations are groups of workers within a
particular workplace. Their aim is to advance the interest of their members or the workers in
general. They negotiate with management or their employer for favorable benefits such as fair
wage, additional benefits and good working condition among others. Trade unions are
common in large companies employing hundreds of employees.
5. Transnational advocacy groups
These are self-organized groups undertaking voluntary actions in several countries.

These groups work within a global network to address global concerns ranging from
environmental (e.g. pollution) to political (e.g. corruption and human rights). Advocacy groups
are limited to just serving as pressure groups influencing the way policymakers and
implementers craft and implement laws and policies.
There is one advocacy group operating in 55 countries. The group challenges

governments and corporations to take actions in safeguarding the environment. While another
advocacy group reports and publishes corruption perception index and gives recommendation
to heads of countries for them to take actions.
6. Development agencies
Development agencies are non-profit entities established to foster the cooperation

between the public sector, the private sector and civil society towards sustainable
development.
Development agencies work mostly in depressed and underdeveloped areas or
regions in the country. For development works to be successful, there must be an engagement
of the whole community and local resources are utilized.
One private development agency in the Philippines partners with homeless people in
the building and construction of their houses.
7. International organizations
Mingst defined an international organization as an institution drawing membership from

at least three states, having activities in several states, and whose members are held together
by a formal agreement or a treaty.
International organizations serve many diverse functions, including collecting

information and monitoring trends, delivering services and aid (e.g., the World Health
Organization), and providing forums for bargaining (e.g., the Association of South East Asian
Countries ASEAN) and settling disputes (e.g., the World Trade Organization).
Our country has been a member of several international organizations such as the
United Nations (UN), the ASEAN, the World Trade Organizations and the Asia Pacific
Economic Cooperation (APEC) to name a few.

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NON-STATE INSTITUTIONS

The Corporation Code of the Philippines define a corporation as an artificial being

Corporations are organizations created by people known as shareholders or

A corporation can be established for profit or non-profit purposes. The majority of

Corporations contribute to the development of economic activities through efficient and

The Cooperative Development Authority (CDA) defines cooperative as an autonomous

A cooperative is an enterprise established by members who contribute money to a

Both organizations has a Board of Directors in charge of policymaking. They are

5. Transnational advocacy groups

These are self-organized groups undertaking voluntary actions in several countries.

There is one advocacy group operating in 55 countries. The group challenges

Development agencies are non-profit entities established to foster the cooperation

Mingst defined an international organization as an institution drawing membership from

International organizations serve many diverse functions, including collecting

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