| |
Cooperative business |
Investor-owned business |
Non-profit organization |
|---|
| Ownership |
The share is listed in the member's name. |
Generally, a share carries no name. Unless registered, it belongs to the bearer. |
There is no ownership. Members are taken on (or membership
accepted) when they agree to pay annual dues conferring member
status or to pay a one-time membership fee. |
|---|
| |
In general, a share may not increase in value. It can usually only be redeemed by the
cooperative at its par value. |
A common share may increase in value. A shareholder may sell his
or her shares to another person at an agreed-to price. |
Anyone may become a member, whether or not they use or benefit
from the services provided by the organization, as long as they
support the purpose of the organization. |
| |
A member's responsibility is limited to the amount of the shares he or she holds. |
A shareholder's responsibility is limited to the value of the shares he or she holds. |
|
| Voting |
A member is entitled to only one vote at a general meeting, regardless of the number of shares
he or she holds.
Certain cooperatives with a large and dispersed membership may
introduce a delegate structure for representing members (e.g.,
delegates representing multiple members from a geographic
district). |
The number of votes a shareholder is entitled to at a general meeting is equivalent to the number of shares held in the company. |
Generally, one person, one vote. Delegates or proxies may be used depending on the governing legislation. |
|---|
| |
No proxy voting allowed. |
A shareholder may use a proxy to vote his or her shares. |
|
| Sharing in the surplus |
Cooperative legislation may limit or prohibit the payment of
interest on share capital. |
There is no limit on share dividends. |
Surpluses do not belong to individual members but to the organization. They may, therefore, not
be redistributed among the members but must be returned in full to the indivisible general reserve of the
organization. |
|---|
| |
Surpluses may be paid into the reserve or to members in the form of patronage returns
proportional to the business done by each member with the cooperative.
Some legislation allows cooperatives that issue investment shares to allocate part of their surpluses as
dividends on those shares.
Some legislation may stipulate that a cooperative's general reserve is indivisible, or divisible in whole or in
part.
Some cooperatives, such as housing, health-care and day-care cooperatives, are structured as non-profit
cooperatives. Surpluses are not distributed to members. |
Profits may be distributed in the form of dividends according to the provisions for each class of
shares, or reinvested in the company. |
|
This information is from the Co-operatives Secretariat information kit
entitled "Forming Our Co-operative." To obtain a paper copy
of this publication, you can contact them at the following address:
Corporations Canada
