Besides sole proprietorships, partnerships and companies, there are several other forms of business that are important in the Malaysian economy. Each has its own features and purpose.
Cooperative
A cooperative is an organisation owned and controlled by its own members on the principle of mutual cooperation. Each member has one vote regardless of how many shares they hold. Profits are returned to members as a dividend. A cooperative is registered with the Malaysia Co-operative Societies Commission (SKM).
Example
A school cooperative that sells books and stationery to pupils is a cooperative. Its profits are shared among the cooperative's members.
Franchise
A franchise is an agreement in which a franchisor allows a franchisee to run a business using its brand, products and system in return for a royalty. Examples include international fast-food chains and branded convenience stores.
Government-Linked Company (GLC)
A GLC is a company in which the government holds a major stake or control, usually through an investment agency. GLCs carry out commercial activities but also support the nation's development agenda.
Multinational company
A multinational company operates in more than one country. It brings investment, technology and job opportunities into Malaysia, and it also raises competition, which pushes local businesses to become more efficient.
Why other forms exist. Each of these other forms meets a need that the usual ownership forms cannot. A cooperative lets a group of individuals pool their resources and enjoy shared benefits. A franchise lets an entrepreneur start a business at lower risk by using a brand and system already proven to work. A GLC helps the government carry out strategic projects such as energy, transport and telecommunications. This variety of forms makes the national economy more balanced and resilient. For example, cooperatives do much to help lower-income groups enjoy goods at fair prices, while franchises and multinational companies bring in big brands and investment that generate thousands of job opportunities.
Remember
The unique feature of a cooperative is "one member, one vote" — control does not depend on the amount of capital contributed, unlike a company.