TYPES OF PUBLIC CORPORATIONS
Public corporations can broadly be categorized based on their core
functions and purposes.
Trading and Commercial Corporationsfocus on operating businesses
and providing goods or services with the aim of making profits, though a
portion is remitted back to the government. They may have monopoly in
certain industries like power or function in competitive markets similar to
private firms. Examples include Kenya Power, Kenya Oil Refineries, and
National Housing Corporation.
Marketing Boardsare established to assist local farmers in getting the
best prices for their produce. They collect, transport, process and help
market agriculture outputs to local and international buyers on behalf of
farmers. Agencies like Coffee Board of Kenya and Cotton Lint Board fall in
this category.
Finance and Banking Corporationsaim to provide banking services,
generate revenue, mobilize public funds, and support trade and
development through credit. Entities like Postbank, Development Bank
and Agricultural Finance Corporation serve this role.
Research Corporationsundertake research to further industries,
agriculture, health and other sectors. Examples are Coffee Research
Institute and Medical Research Institute.
Development Corporationsfocus on developing specific
underdeveloped regions seen to have potential. Agencies working in this
space are Irrigation Board, Lake Basin and Tana River Development
Authorities.
Regulatory Corporationsestablish and control standards, quality and
direction of sectors represented. Examples given were Kenya Bureau of
Standards, Electricity Regulation Board and Communications regulator.
Service Delivery Corporationsprovide essential specialized services of
national importance like exams council and national hospital.
WHAT IS A COOPERATIVE?
A cooperative is a user-owned, user-controlled business where people
come together voluntarily to meet common economic, social and cultural
needs and aspirations. Members share any profits equitably based on their
participation.
Features of Cooperatives
They are legally registered groups where each member has one equal
vote regardless of investment size. Profits get distributed in proportion to
member transactions. Limited liability protects personal assets from
business debts.
Origins and Growth
The idea of cooperative teamwork to achieve mutual benefit has existed
for centuries worldwide. However, they really took shape in 19th century
England as workers pooled resources to weather economic hardship
together. Kenya's cooperative movement began in the early 1900s and
expanded rapidly post-World War 2 .
Cooperative Principles
Key guidelines include open membership, democratic control, limited
interest on capital, member education plus allocating surpluses equitably
based on use. Voluntary participation respects diversity while fiscal
responsibility stems from each owner having skin in the game.
Formation Process
A cooperative legally incorporates once registered by meeting registration
requirements with the Commissioner for Cooperative Development.
Minimum founding members and submitted documentation grants
certification allowing business activities.
Rights and Privileges
Incorporated status provides protections like binding bylaws, shielded
personal liability and deceased members' transferable entitlements.
Contracts with members take precedence while shares retain first charge
for member debts to the cooperative.
Overall, cooperatives have proven an effective strategy globally for
communities to access markets and lift living standards through collective
economic participation and ownership.
WHAT IS A PARTNERSHIP?
A partnership involves two or more individuals coming together to operate
a business as co-owners and share any profits. It's governed by the
Partnership Act. A written agreement called a "partnership deed" outlines
each partner's role and stake.
Partnership Features
Partners jointly provide capital from personal savings or loans. One
partner's actions legally bind the others. Profits and losses split according
to the deed. Unlimited liability means each pays debts from their own
money if needed.
Forming a Partnership
No major paperwork is required. A simple verbal or written agreement can
establish it. Registration adds name protection advantages.
Capital Sources
Contributions kick things off alongside optional borrowing from friends,
banks, government agencies or creditors. Profits also fuel continued
functioning over time.
Types of Partners
Roles vary from active daily managers receiving pay to silent backers
simply lending their name. Liability splits between general and limited
partners too. Minors' involvement relates to reaching adulthood.
When Partnerships Work Well
Larger capital pools suit capital-intensive industries like manufacturing or
construction. Professions needing many skilled individuals like law and
healthcare jointly achieve more. Not being corporately organized also
guides some fields into this structure. Strong cohesion predicts stability.
Emerging Trends
Rather than working entirely solo, more family members, companions and
professionals choose partnerships to mutually support their goals these
days. Multinational regulations often dictate mixed local-foreign teamups
as well. Overall, this flexible corporate alternative remains quite prevalent.
