Private Versus Public Organizations Report Examples
Composition: It’s composed of any person, partnership, corporation, association or agency which is not a public body that is operated for profit; it’s self-sustaining, established and operated on Federal property, by individuals and is not part of the government. But public organization is part of the economy concerned with providing various government services; public sectors include public roads, education, and policies (Boyne, 2002).Minimum no of members; private company requires a minimum number of two, but a public organization requires at least seven members.
Maximum number of members: in the privately owned companies the maximum number is restricted to fifty, in the case of the public company there is no restriction on the maximum number. Issue of prospectus: private organizations are limited from inviting the public to subscribe their shares this means that private organizations cannot issue prospectus, whereas public body is free to invite public to subscribe its shares meaning it can issue a prospectus (Abu-Doleh, 2007).
Commencement of business: private company commences its business immediately after its incorporation but in the public company they cannot start their business until they get a certificate of commencement. Statutory meeting: a private organization calls statutory meeting with no obligation but in the public organization they have an obligation that whenever they call a statutory meeting they must file statutory report with the register of companies.
Further issuance of shares: a private organization is not supposed to issue further shares to its existing shareholders in case of the public company it has to offer more shares to its existing shareholder. Further issuances can only be offered to public through approval of existing shareholder (Carver, 2011).Director’s consent: in a private organization there is no need to give permission but in a public company directors are required to sign an undertaking to acquire qualification shares of public (Djankov, 2007).
Company secretary’s private does not have to appoint a company secretary, unless the articles dictate otherwise but in the case of a public organization a company secretary is required and it’s the responsibility of director to take all reasonable steps in ensuring that secretary is a person who appears to them to have a requisite knowledge to discharge manager duties (Markovits, 2007).Meetings and shareholders resolutions: A private company does not need to hold annual general meeting unless the article dictates so, shareholders resolutions can be passed by a written resolution which is a quicker and simpler process whereas in public company they must hold annual general meetings within six months of its financial year end, shareholder resolutions here are passed by majority in a meeting (Mitchell, 2013).
Management of organizations: private companies are run by group of investors or business owners and not board of directors whereas in public company it is run by board of directors because if an enterprise is publicly owned it will compel to increase shareholder value (Osborne, 2010).Quorum: in case of the private company the quorum here are two members to be present personally but in case of the public company five members must be personally present to constitute a quorum (Post, 2012).Number of directors: In a private case there are two directors to manage their affairs whereas in the public company there are at least three directors who help the business in managing its affairs (Roman, 2006).
Transferability of shares: in the private business there are complete restrictions on the transferability of shares through its Article of Association whereas in the public company there are no such restrictions on transferability of shares (Wettenhall, 2009).In conclusion, there are so many distinctions between private and public organizations and for one to be involved with either he ought to gather all the required information.
Abu-Doleh, J., & Weir, D. (2007). Dimensions of performance appraisal systems in Jordanian private and public organizations. The international journal of human resource management, 18(1), 75-84.
Boyne, G. A. (2002). Public and private management: what’s the difference?.Journal of management studies, 39(1), 97-122.
Carver, J. (2011). Boards that make a difference: A new design for leadership in nonprofit and public organizations (Vol. 6). John Wiley & Sons.
Djankov, S., McLiesh, C., & Shleifer, A. (2007). Private credit in 129 countries. Journal of financial Economics, 84(2), 299-329.
Markovits, Y., Davis, A. J., & Van Dick, R. (2007). Organizational commitment profiles and job satisfaction among Greek private and public sector employees. International Journal of Cross Cultural
Mitchell, R. C., & Carson, R. T. (2013). Using surveys to value public goods: the contingent valuation method. Routledge.
Osborne, S. P. (Ed.). (2010). The new public governance: Emerging perspectives on the theory and practice of public governance. Routledge. Management, 7(1), 77-99.
Post, J., & Preston, L. (2012). Private management and public policy: The principle of public responsibility. Stanford University Press.
Roman, P. M., Ducharme, L. J., & Knudsen, H. K. (2006). Patterns of organization and management in private and public substance abuse treatment programs. Journal of Substance Abuse Treatment, 31(3), 235-243.
Wettenhall, R. (2003). The rhetoric and reality of public-private partnerships.Public Organization Review, 3(1), 77-107.