Cooperatives vs. stock corporation: legal forms in comparison

Not only since Frank Schirrmacher publicly thought about the fact that the left is right, being left is back in fashion: Because thanks to the current developments in the Internet is at Companys radical rethink asked. So cooperative society instead of a joint stock company?

Cooperative vs. stock corporation: differences and similarities

An important legal question that arises in many contexts with many different types of companies is the question of the legal form of the company. Various legal forms are available to companies, allowing them to adapt to their specific Tasks and needs to adjust. In Germany, the standard company form is the GmbH. The not necessarily most common, but perhaps the most interesting legal forms for companies today are the cooperative and the stock corporation.

A cooperative is a community-based one Organization, which is owned and controlled by its members. The cooperative has a legal obligation to ensure that its members always have an effective say in the management of the cooperative. The administrative structure of the cooperative is democratic.

In a public company, the members have no legally enforceable engagement, to ensure that the members of the cooperative have an effective say in the management. In a public limited company, members are required by law to ensure that they have access to the assets of Society to have.

Trend instead of mass market

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The democratic company form makes the cooperative the ideal legal form for digital companies. Because the trend, especially on the Internet, is moving more and more towards special products and services instead of the mass market, communicative cooperation instead of advertising campaigns, cooperation instead of competition, solid Financing instead of overdrawn loans.

It is a coincidence that it even has its own legal form, as this was previously completely unpopular. The corporate form of the cooperative, which enables participation, participation and shared responsibility, has existed since the 19th century: the cooperative. And it has been increasingly rediscovered in recent years.

Independence makes cost-effective

There are also exciting examples of this: freelancers from the ITIndustry founded a service in Bremen in 2004 to arrange IT projects for their members. The basic idea was to become independent of professional brokers.

Because on the German IT market, specialists are usually placed by personnel agencies or project exchanges, who earn a lot from it: "We want to eliminate this middleman through direct marketing and with it that Income of the members, but also increase their competitiveness," explains Manfred Feige, the board member Motivation.

Open up new target groups with the perfect legal form

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Since Jariva eG knows every specialist personally, it can tailor-made customers, bring projects and experts together – faster and more efficiently than large intermediaries. And the freelancers can pass their cost advantage on to their customers. What's more, thanks to the division of labor and cooperation, the members are able to take on larger and more complex projects.

Jariva even provides a replacement in the event of illness. And: Especially when there are problems and crises, the community helps each other because the comrades are there to provide advice and assistance.

Cooperative as an anti-capitalist legal form?

Jariva made a conscious decision in favor of the cooperative as a company: “We wanted to use synergies together. And the purpose of a cooperative in life is to support its members economically, ”says board member Feige.

This is exactly what distinguishes cooperatives from other legal forms, such as the company itself. Although both company forms are the members of the Supervisory Board and the Board of Management, and the most important body is the General Meeting of Shareholders, And in both company forms, one acquires business shares, which is called shares at the AG. End of similarities.

Advantages and disadvantages of cooperative and stock corporation

Surprisingly, there seems to be a heated debate about which form of company is best: some claim that the joint stock company is the better form of company as it offers more flexibility and is not as bureaucratic as a cooperative. Others claim that the cooperative is the most sensible Choice, as it is easier to manage and offers more benefits to its members.

The fact is: a cooperative is not as anti-capitalist as it appears at first glance. For example, it has a lot in common with a stock corporation. But there are also some fundamental differences. Now what is the better system?

Let's say: The Eichborn AG, which had chosen this legal form to be independent from large publishing houses, has recently filed for bankruptcy. The TAZ as co-operative continues to operate as one of the few media houses in Germany. But where are the differences between the two legal forms?

Democracy or influence: it depends on the company's goals

The essential difference between AG and eG, which by the way means nothing else than registered cooperative, is how the shareholder can exercise his influence. In the case of the AG, the right to vote is vested in the Action coupled. So whoever owns the most shares has the greatest influence. This principle is clearly recognizable at the general meetings of the large German stock corporations.

An example: 6.000 small shareholders vote no when a resolution is passed. One of the shareholders from the front row votes yes. The chairman then announces that the resolution has been adopted. The gentleman in the first row represents a company that holds 91 percent of the shares. And 6.000 small shareholders must follow.

With a cooperative, however, such a concentration of power would be unthinkable and that is exactly what makes it far more flexible than other legal forms. And maybe even better. In the end, it depends on the company goals which form seems more suitable and who decides the weal and woe of the company decide should.

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