Difference Between Cooperative Society And Joint Stock Company

Difference Between Cooperative Society And Joint Stock Company

The major dissimilarities or difference between cooperative society and joint stock company can be highlighted as follows:

1. Introduction

Cooperative Society: Type of business organization formed and operated by like minded people in the society to achieve economic and social benefit.

Joint Stock Company: Type of business organization owed and operated by association of persons (shareholders and promoters) with the motive of earning large amount of profit.

2. Formation And Registration

Cooperative Society: Minimum 25 members are required to form cooperative society. It is registered according to the Cooperative Act of the country,

Joint Stock Company: 1-7 members are required to form  joint stock company. It is registered and regulated by the Company Act of the country.

3. Formation Process

Cooperative Society: Formation and registration process is easy, less time consuming and less costly because of less legal formalities.

Joint Stock Company: It is complex, time consuming and costly process because of several steps and various legal formalities.

4. Objective/Purpose

Cooperative Society: Providing services to members and fulfilling social, economic and cultural needs of the society.

Joint Stock Company: To earn significant amount of profit.

5. Middlemen/Intermediaries

Cooperative Society: It eliminates the role of middlemen and intermediaries in the business.

Joint Stock Company: Middlemen and intermediaries play major role in the business of joint stock company.

6. Profit Motive Or Service Motive

Cooperative Society: Service motive and promotion of common welfare

Joint Stock Company: It is profit motive organization and seeks to earn higher profit.

7. Government Privilege And Control

Cooperative Society: Special privilege and less government control

Joint Stock Company: Less government privilege and strict control and regulation

8. Share Transfer

Cooperative Society: Members cannot transfer or sell their shares to others but they can withdraw

Joint Stock Company: Share are transferable

9. Proxy Allowed Or Not

Cooperative Society: No

Joint Stock Company: Yes

10. Types Of Customers

Cooperative Society: Mostly, members are also the customers of cooperatives

Joint Stock Company: Sellers and customers are different

11. Amount Of Capital

Cooperative Society: Less capital than joint stock company

Joint Stock Company: It can raise large amount of capital

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Difference Between Public And Private Company

12. Voting Principle

Cooperative Society: It follows 1 man 1 vote principle

Joint Stock Company: It follows 1 share 1 vote principle

13. Members Type

Cooperative Society: Local people of the society

Joint Stock Company: Members are scattered and from different places.

14. Area Of Operation

Cooperative Society: It is operated in certain and limited area

Joint Stock Company: It is operated in national and international level

Cooperative Society Vs Joint Stock Company (Comparison Chart)

Basis	Cooperative Society	Joint Stock Company
Introduction	Business organization formed by the local people to achieve social and economic benefit	Large business organization formed and operated by shareholders and promoters to earn huge amount of profit
Members	Minimum 25	1-7 Members required
Formation Process	Easy	Complex and lengthy
Objective/Purpose	To fulfill social, cultural and economic needs of the society	To earn large amount of profit
Middlemen	No	Yes
Motive	Service Motive	Profit Motive
Government Privilege	More	Less
Share Transfer	No	Yes
Proxy Allowed	No	Yes
Government Control	Less	More
Capital	Less	More
Voting Principle	1 man 1 vote	1 share 1 vote
Members Type	Local people	Scattered
Area	Specific area	National or international level

I hope this post is helpful to understand the difference between cooperative society and joint stock company and to make comparison between them.