IB Business Management: Unit 1.2 (Types of Business Entities)

Cooperatives

For-profit social enterprises set up, owned and run by their members, who might be employees and/or customers.

Company (or corporation)

A business that is owned by shareholders. It has been issued a certificate of incorporation, giving it a separate legal identity from its owners.

Deed of partnership

A binding legal document which states the formal rights of partners

Incorporation

Establishes a legal difference between a business and it's owners.

Initial Public Offering (IPO)

The first public offering of a corporation's stock.

limited liability

A form of business ownership in which the owners are liable only up to the amount of their individual investments into the company.

- Personal assets cannot be used to pay off debts

non-governmental organization (NGO)

Private organizations that pursue activities to relieve suffering, promote the interests of the poor, protect the environment, provide basic social services, or undertake community development.

Partnerships

businesses with two or more owners wo share business responsibilities

Private sector

the part of the economy that involves the transactions of individuals and businesses

privately held company

This is a business owned by shareholders with limited liability, but the shares cannot be traded on a public Stock Exchange.

publicly held company

an incorporated limited liability business that allows shareholders to buy and sell shares in the company via a public stock exchange

public sector

the part of an economy that is controlled by the government.

sole trader

business owned and operated by one person

social enterprises

Revenue-generating business with social objectives at the core of their operations. They can be for-profit or non-profit businesses, but all profits or surpluses are reinvested for that social purpose rather than being distributed to shareholders and owners.

stock exchange

A place where shares in a company or business enterprise are bought and sold.

unlimited liability

Legal liability for all monies owed to creditors, even if personal possessions must be sold to pay off debts.

- Unique to sole traders and ordinary partnerships.