Difference Between Cooperative and Corporation

Corporations and cooperatives are entities formed with the intention of doing business, however, they have very different structures. Difference Between Cooperative and Corporation

Here we show you what is the difference between a corporation and a cooperative.

COOPERATIVE  Difference Between Cooperative and Corporation

A cooperative is a non-profit organization, since it does not keep any of the profits for itself. It distributes all the profits among its members. You can’t even speak strictly of “earnings” as it usually provides other benefits and services to the members involved.

In a cooperative, a group of people come together voluntarily and cooperate for their mutual benefit, social, economic, cultural. The cooperative is operated for the benefit of those who use its service, each client is a member and each member is partly owner.

The main objectives of cooperatives are to satisfy the common needs and aspirations of their members, through the exchange of property and democratic decision-making. Each member shares responsibility, rights and profit (if there is one).

The leaders, as president, secretary and treasurer may be appointed by vote of the members.


A corporation is a legally separate entity, owned by shareholders. Shareholders have legal rights and responsibilities. They may work for profit or non-profit, but generally they work with the intention of profit.

The profits are first reinvested in the corporation and then in the shareholders in the form of dividends, as decided by the president of the corporation.

If something is wrong with the corporation, the blame does not fall directly on the shareholders; but on the board of directors.

In conclusion, it can be said that cooperatives are analogous to Socialism , since they work for the common good; while corporations are analogous to Capitalism in that they almost always work for profit.

Key differences between corporation and cooperative

  • Cooperatives are autonomous societies, while corporations are legally separate entities.
  • Corporations tend to be for profit, while cooperatives seek the common benefit of each of their members.
  • In cooperatives each member is responsible, while in corporations the main responsibility falls on the board of directors.

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