Non State Institutions

NON-STATE
INSTITUTIONS
WEEK 2 Q2
NON-STATE INSTITUTIONS
 Non-state institutions – refer to institutions that are organized

by private individuals or groups for the purpose of providing
services to the members of society. These institutions are not
controlled by the government but are regulated through laws and
statues of the state.
 Tradeunions and cooperatives – have the primary role

of promoting labor welfare and good industrial relations.
Trade unions and cooperatives are organizations
comprising workers and labors with common goals,
purposes, and interests.
 Financial institutions – are organizations that serve as bridges or
intermediaries that facilitate the flow of money in various transactions.
This means that financial institutions serve as links between the source of
funds, the depositor, the fund user and the borrower.
 Banks – receive savings and deposits of their clients. These may be
loaned out to borrowers.
- traces its origin from the Old Italian word “banca” which means table or
bench and where transactions occurred at that time.
BANKING INSTITUTIONS
 Bangko Sentral ng Pilipinas – known as the banks of all banks in the
Philippines. It is the bank responsible for the regulation, creation, and
management of monetary supply in the country.
TYPES OF BANKS
a. Commercial Banks – accept savings deposits, check deposits, and time
deposits. (Ex. BPI & Metrobank)
BANKING INSTITUTIONS
TYPES OF BANKS
b. Thrift Banks – are categorized into stock savings and loan associations,
savings and mortgage banks, and private development banks. They
consolidate the savings deposits of their members into a fund from which
their members can draw loans with interest. They also accept deposits
from the public and provide loans for small and medium scale
enterprises.
c. Rural banks – cater primarily to farmers and small business people,
mostly in rural areas.
CORPORATIONS
A corporation is an organization of people legally-bound by a charter to

conduct some type of business. It has a legal entity separate from its owners.
The type of business that a corporation wants to venture in depends on its
articles of incorporation.
Articles of incorporation – are written application to the government
requesting permission to form a corporation. This will give the name,
address, and type of business for the corporation; the names of the officers,
and the initial amount of money being put into the business.
ADVANTAGES OF CORPORATIONS
 Easy to raise funds – since the corporate from is the most effective for
raising money.
 Limited liability – the concept that owner of the business are only
responsible for its debts up to the amount they invest in the business.
 Unlimited life – not ceasing to exist if a major stockholder dies.
 Specialized management – affording to have specialized managers to run
the business.
 Shared risks – spreading business riss among many owners.
DISADVANTAGES OF CORPORATIONS
 Difficult to start – needs government approval before starting the
business.
 Less direct control – owners that are usually far from the day-to-day
operation of the business
 Double taxation – corporate taxes that need to be paid by the corporation
and the owner who received dividends from the profit.
 Limited activities – limited activities by the article of incorporation.
COOPERATIVE AND TRADE UNIONS
A cooperative is a voluntary organization of people who have agreed to
pool their resources together to undertake an economic enterprise to meet
their everyday needs. A cooperative is something that they democratically
manage, control, and share the economic benefits by participation and
patronage (Cooperative Development Authority, DCA)
 Trade unions or labor unions – are voluntary associations of either
employers, or independent workers to protect their interest and become an
instrument of defense against exploitation and maltreatment.
COMMONALITIES OF COOPERATIVE
AND TRADE UNIONS
 Organized and formed by a group of people to

protect their interest.
 Promotes the common good among members, and
 Voluntary in nature
COMMONALITIES OF COOPERATIVE AND
TRADE UNIONS
TYPE OF COOPERATIVE DESCRIPTION
Promotes thriftiness among its affiliates, and
Credit Cooperative creates funds to grant loans for productive
endeavor of members.
Procures and distributes commodities to
Consumer Cooperative
members and non-members.
Undertakes joint agricultural or industrial
Producer Cooperative production.
COMMONALITIES OF COOPERATIVE AND
TRADE UNIONS
TYPE OF COOPERATIVE DESCRIPTION
Participates in the supply of production
Marketing Cooperative inputs to constituents, and markets their
products.
Engages in medical and dental care,
hospitalization transportation, insurance,
Service cooperative housing, labor, electric lights and power
communication and other services.
Difference between Cooperatives
and Trade Unions
AS TO THE PURPOSE:
COOPERATIVES TRADE UNIONS
Republic Act 6938: Cooperative
Code of the Philippines
 To encourage thrift and savings  To maintain or improve the

mobilization among members conditions of employment at the
 To provide goods, services, and workplace, such as ensuring safety
some requirement to members, standards, right to be protected
 To develop expertise and skills from unfair termination of
among members employment, right to paid leave,
and right to equality.
 To acquire lands and provide

housing benefits or support to
members  To bargain with the employer on
 To insure against losses of the behalf of the union members and
members negotiate labor contacts
 To promote or advance the
educational, social and economic
status of members.
 To establish, own, or lease

cooperative banks, cooperative
wholesale and retail complexes,
insurance, agricultural, or  To protect the economic, political
industrial processing enterprises, and social interests of its members
and public market; and
 To coordinate and facilitate various
activities of the union.
Difference between Cooperatives
and Trade Unions
AS TO FUNCTION:
 Provide maximum economic

benefits to its members.  Negotiate or discuss with the
 Teach people efficient and effective management the issues that affect
ways of doing things in a the organization’s workers.
cooperative manner.  Represent individual members
 Propagate cooperative practices and when they have a problem at work.
new ideas in business and  Provide information and advice to
management, and allow lower its members about work-issues and
income groups to expand their concerns.
ownership of wealth
Cooperatives and Trade Unions as
Means of Promoting Self-help
Towards Economic Development
 Cooperatives are self-help organizations presently utilized by the
government as more efficient tools for economic development.
 Trade Unions are always fighting for better wages by improving
employees pay and other benefits such as holiday entitlements.
FUNCTIONS
 Secure improvements in employees’ working conditions,

including hours of work, health or safety at work, improving
pensions, and industry injury benefits.
 Provide improved standards of living
 Safeguard the interest of workers by encouraging films to
increase employee participation in decision-making.
 Prevent employees from exploitation.

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NON-STATE

 Non-state institutions – refer to institutions that are organized

 Tradeunions and cooperatives – have the primary role

A corporation is an organization of people legally-bound by a charter to

 Organized and formed by a group of people to

 To encourage thrift and savings  To maintain or improve the

 To acquire lands and provide

 To establish, own, or lease

 Provide maximum economic

 Secure improvements in employees’ working conditions,

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