7.5 - Not-For-Profit Business

With these businesses, profit is not the main driver. They are generally philanthropic, social and charitable in outlook. Any form of profit or surplus goes toward the cause that the business represents. These organisations can have any of the following legal structures and governing bodies:

• Unincorporated Associations - These have a constitution of rules and the members of the governing body are trustees
• Trusts - These have a deed or declaration of trust that will be the governing document. The members of the board of a trust are the trustees
• Companies Limited by Guarantee - These will have a memorandum of association and a governing body consisting of the directors of the company

Any charitable organisation which is also a company will have directors and trustees as the voting members. 

Charities

Charities need to have a well defined purpose that would need it to be legally classified as charitable. These can range widely from famine relief to educational development. Registered charities do not have political motivations or directions of any kind that are not encouraged to incline in such directions. 

It's important to note that:

• Charities are established primarily for charitable reasons
• They are independent
• They are not set up to make profit

Societies

These are established for non-commercial purposes without personal gain, charitable reasons and participation is sports events and cultural activities. 

Cooperative societies have limited liability and are incorporated organisations. They have shares which members can buy in order to support the business. These shares are not sold on the stock exchange. When a member leaves a cooperative society, the amount of shares which they have, need to be sold back to the society. 

Any profit generated by the society is shared as dividends to the members. 

Pressure Groups

These are established with the major objective of influencing political decisions. They are involved in research, political lobbying of the government, seeking to influence decision-makers and enhancing public awareness of political issues. These work outside of the government and are not political parties. 

Due to their political interaction they also try to influence the businesses, make an environmental impact and try to enhance corporate responsibility to the community and environment. 

These groups also interact with consumers to secure better value for money from the business.