Modern economy widely investigates the phenomenon of corporate entities as a specific management object. Nevertheless, questions concerning not only creation, functioning, and development of corporate entities, but also qualitative features, characterizing the notion of «corporate entities», «corporation», «body corporates», «corporate economy sector» still remain disputable and are not explained yet. This, in turn, leads to the deficiency of practical studies in the given sphere. From our point of view, the solution of this problem is impossible without a fundamental research of corporate sector forming in the Russian national economy within the institutional theory, which allows defining fundamental problems, discovering efficiency enhancement ways of corporate governance and corporate development.
It is necessary to clarify the conceptual framework of such category, as a corporation and corporate entities for further research.
The notions «corporation» and «corporate entities» are widely used in contemporary economic science and are as a rule identified with the notion «joint stock company», that is conceptually wrong, not least because the corporation may be formed in other organizational legal structures, such as a closed joint-stock company, a limited liability company.
V.B. Kondratyev, quoting Robert Monk, says that «a corporation appeared in the XX-th century as a project management institute on the identification, distribution, and realization of abilities and talents of a person and its transformation into value» (V.B. Kondratyev Competitiveness of Russian Corporations at Global Markets / Кондратьев В.Б. Конкурентоспособность российских корпораций на глобальных рынках).
It is possible to meet a definition of corporation in the economic literature as a specific form of business organization, which is subjected to the law and is a separate legal entity in relation to law. Owners-shareholders establish an organization (company, enterprise), which may legally possess property, be a holder, raise loans etc. by means of incorporation, i.e. the formation of incorporated society. Any group of people can create a corporation, having accomplished a certain registration procedure, based on the founding documents. To our opinion, such rendition of corporation simplifies the meaning of corporation, does not reveal a social relevance and objective functioning, does not distinguish differential characteristics of a corporation, which may separate it from other organizations, putting the main emphasis only on the procedure of organizational documentation.
S. Shimshilov holds an opinion that «a contemporary corporation of business type is a large enterprise or their union, which has a large consolidated capital, created by means of pooling of capital of economic entities, and its extended reproduction, as well as labor cooperation, having a system of management, the basis of which is innovative risky activity, high organizational culture for the purpose of getting entrepreneurial income» (S.A. Shimshilov Conceptual Framework of Personnel Management in the Profit Oriented Businesses / Шимшилов С. А. Концептуальные основы управления персоналом предпринимательской организации // Закон и право, 2005. № 5. С. 62-66).
From our point of view, it is possible to distinguish the following characteristics, whereby one may identify a corporation from other organization structures. They are as follows:
— assets complex, which is heterogeneous in structure;
— multilevel structure of management and control (synthesis of several legal and individual persons at the possible participation of credit organization);
— high degree of manufacture diversification;
— presence of head organizations and affiliated branches (representative offices) abroad;
— mixed staff (according to the national identity), although we do not consider this characteristic as obligatory or determining;
— fulfillment of on-line business support;
— rate of export business transactions in the company profit not less than 30%;
— preparation of accounting reporting in accordance with international standards;
— execution of entrepreneurial and emissive activity;
— stock quotation at the security market (inclusion into listing);
— observance of codes and other recommendation acts of corporate behavior;
— ratio in the gross domestic product (GDP) of the country not less than 0.5-1%;
— informational and financial transparency of business;
— composition, analysis and monitoring for the activity of the organization on the basis of consolidated statements.
Corporate property as a form of benefit acquisition by the integrated capital participants for the purpose of its extended reproduction and provision of material satisfaction of needs, is a socioeconomic base of corporation.
According to S. Shimshilov (S.A. Shimshilov Conceptual Framework of Personnel Management in the Profit Oriented Businesses / Шимшилов С. А. Концептуальные основы управления персоналом предпринимательской организации // Закон и право, 2005. № 5. С. 62-66) the binder in the establishment of the efficient internal relations is «an intracorporate, organized competition, representing the genuine competitiveness between corporate employees, its numerous organizational units, and functional services». Based upon the opinion of S. Shimshilov, competitive relations inside the company do not have a destructive nature and cannot lead to the increase of transaction costs, but, vice versa, due to the high level of technological expansion, the use of the latest achievements in science, attraction of highly professional specialists, improve the efficiency of work of the whole structure as a result of interaction and exchange of knowledge, skills, experience, and their achievement.
Corporation takes charge of formation and redistribution of income between the associated subdivisions. It secures the financial and technological support of its subdivisions in case of development or application of new spheres of activities, which afterwards lead to the growth of prosperity in the whole corporation.
To our opinion, high level of management decentralization is characteristic for corporations. Companies, comprising the corporation, have all powers for the execution of entrepreneurial business at their own risk. However, it does not eliminate the necessity or possibility of centralized corporation management as a whole. As a rule, planning functions of company-wide activity, monitoring and its adjustment perform the highest management within the limits, which do not contradict with the ordinary subdivision activities, not breaking the level of relevant liberty.
Corporation accumulates the vast resource, scientific and technological potential, which allows appropriating and developing of new technologies, organizing new branches or overcoming entry barriers in already existing markets or for the development of new foreign markets.
Corporations are an ideal structure for the maintenance and development of innovative processes within a country. This is mainly associated with the fact that a company-innovator in corporation structure gets the extensive support from all participants that is necessary at the initial stage of entrance to the market. In addition, corporate structures mainly affect the broad market segment, basically being monopolists in the access to informational resources or new technologies. Furthermore, as noted above, financial flows in corporate structures are distributed among all subdivisions or are transferred to more «demanding» ones that is a key moment in the development of a pioneer product.
Thus, to our opinion, a corporation is a unique form of entrepreneurial business, which causes the possibility of the most efficient risk redistribute, using a wide spectrum of mechanisms. It has a huge potential for the development and realization of precautionary measures, lowering of losses from the unfavorable effects of both external and internal factors, resource mobilization for the rapid liquidation of damages and losses.
A form of corporate structures can acquire both continental, state/interstate, national, regional/interregional, branch/interindustrial meaning. Thus, a corporation is an efficient transfer mechanism of large financial flows from one branch into another on the principle of connecting vessels. Specialists link high hopes for the development of a single market space to the corporate structures on the scale of both national, and world market. A corporate structure bears a great number of not only positive possibilities, connected with the efficient interaction of various institutions, but also has dangers of failure of the whole structure, conditioned by a strong interdependence of separate units. Thus, to our opinion, corporations in conditions of crisis will get rid of non-core or less profitable structural subdivisions with a view to ensuring survival of the entire system.
A corporate structure represents a strategic form of entrepreneurship, implementing peculiar vast opportunities for the effective interaction in various forms such as concerns, holdings, financial industrial groups (FIG), conglomerate. There are the following informal corporate entities: cartels, syndicates, pools, consortia, associations and unions, offshore areas, free economic zones (Fig. 1).
A general notion of concern is «an independent enterprise, uniting several enterprises for close industrial cooperation by means of participation system and personal conditions or any other conditions».
Concern is an organizational structure with a single center of property and controlling body, uniting a number of enterprises. Concern management mechanism includes all management levers.
Concern in economic literature is a corporation, mainly industrial, which comprises a financial institution.
The process of concern creation implies a union (both vertical, and horizontal) of industrial establishments with a well-defined production and coordination center. Industrial diversification of structural parts is possible inside a concern, as a result of which it acquires features of conglomerate.
Concern management is built on the definite system. parent company — subsidiary-companies, which are formally independent from parental, but have agreement relations with concern participants. Also concern in economic literature is a group of enterprises, being participants of entrepreneurial agreement.
Holding is a legal body, which has a large packet of shares of other companies, and fulfills controlling functions in relation to them, created as incorporated society or a company with limited property. In such a manner, holding is a company, which owns a large holding of shares of another company (one or several), performing managerial, regulatory and controlling functions in relation to its capital.
A fundamental difference of a holding from a concern consists in the absence of entrepreneurial agreement, necessary for the entry into the association.
We distinguish the following types of holding, depending on the participation rate in the management of control packets of shares of other companies (New Large Companies («Business Groups») in Russian Transition Economics: Condition, Problems in Economic Literature: Preprint / Крупные новые компании («бизнес-группы») в российской переходной экономике: состояние, проблемы в экономической литературе: препринт WP1/2005/09/ С.Б. Авдашева, В.В. Голикова, Т.Г. Долгопятова, А.А. Яковлев. М.: ГУВШЭ, 2005. 7-8 с.):
— Holding pyramidal groups, building their activity on the obligatory possession of control packet of shares of companies. The main role in the structure of this group belongs to a holding-holder of control packet of shares of other companies, which has a regulatory, monitoring and management function in relation to them.
— Holding companies, which are holders of control packet of shares of other companies, refer to pure companies in economic literature;
— Joint stock companies, control packet of shares of which lies within the net holding, are called subholdings.
— Companies, which apart from the holding of control packet of shares of any company perform production, commercial or other entrepreneurial business, refer to a mixed type of holding.
— Holdings, performing only investment activity, and the capital structure of which consists from 50 % or more of security papers of other emitters and other financial assets, refer to financial holdings.
As a rule, a pure type of holdings appear extremely rare, all types are tightly interlaced and interrelated.
The hierarchy of holding structure may be presented as follows: main (parent) company, which owns a control packet of affiliated companies, and which in turn owns a control packet of shares of grandchildren companies etc.
The following Russian companies are an example of holding structures:
— in metallurgical industry: «Russian Aluminium», «UGMK- Holding», GK «TAIF» , «Production-Metallurgical Holding»;
— in machinery-producing industry: «Transmashholding», «Siberian Business Union»;
— in the sphere of construction material production; rendering of construction services and development: «Energoinvest-Holding», «Globalstroy-Engineering», GK «Tashir», «Mordovcement»;
— oil and gas industry is presented with such companies, as «Gasprom», «NK Rosneft», «Transneftservice-S», «United Oil Company», «Sibuglemet» etc.
Financial industrial groups (FIG) contribute to the economy of any state, being a «magnet», accumulating large financial resources.
Striving of economic entities to create FIGs is explained by cost reduction. Thus, financial structures, joining FIGs, reduce the risk of credit default, imperfection of loan legislation, the level of interest rates of Central Bank of the Russian Federation, allow providing the client the most favorable conditions, which in turn promote the inflow of investment into the sphere of real economy.
Creation of FIGs or large integrated structures for industrial enterprises contribute to their financial strengthening, reduction of transaction costs and the growth of competitive power of the end product.
The objective of creation of a financial industrial group (FIG) is the accumulation of material and financial resources of FIG elements with the aim of efficiency rise of their activity as a result of integration of separate components (synergism), increase of competitiveness, enhancement of scientific and technological progress, and investment attraction.
Basic tasks of FIG creation are as follows:
— resource mobilization on high priority directions of economy development;
— execution of financial innovative activity;
— creation of new spheres of production, support and development of already existing industry sectors;
— formation of strong competitive economic environment.
The following basic principles of FIG creation are identified:
— FIGs are formed based on the single regulatory background and for particular goals;
— diversification of FGP formation variants, beginning from the voluntary entry to compulsory business combination;
— mobilization and accumulation of resources, necessary for the purpose of joint working;
— FGPs are created based on highly technological, perspective, competitive enterprises, at both domestic, and foreign markets;
— creation of several FGPs at one market segment, aiming at the creation of competition;
— state stimulation of FGP activity, directed for the social and economic development of the country;
— combination of packets of shares by the use of both market, and extra-market (with the aim of preservation of state control) mechanisms;
— modernization and formation of new investment vehicles for the development of industrial production;
— carrying out of expert examination for the purpose of socioeconomic project viability of FIG formation.
The main participants of FIG are organizations, acting in the sphere of production of goods and services, as well as banks or other credit organizations. Besides, investment institutions, non-governmental pension funds, insurance companies are included as participants (Federal Law dated November 30, 1995 No 190-Fz «On Financial Industrial Groups» (adopted GD FSRF, October 27, 1995)). According to Article 2 of Federal Law dated November 30, 1995 No 190-FZ «On Financial Industrial Groups» FIGs are «a totality of legal persons, acting as basic and associated companies or fully or partially combining their material and intangible assets (profit sharing scheme) based on the agreement of FIG creation with the aim of technological or economic integration for the implementation of investment and other projects and programs, focused on the competitive growth and marketing development of goods and services, productivity enhancement, creation of new working places» (Federal Law dated November 30,1995 No 190-FZ «On financial industrial groups» (adopted GD FSRF, October 27, 1995)).
According to the Law on FIG two ways of creation of the given associations are possible:
— by means of acknowledgment of total economic entities, combined as parent and associated company of a financial industrial group (i.e. based on the upstream integration of proprietary rights);
— by means of agreement conclusion on the creation of FIG between separate legal entities (i.e. on a contractual basis, giving large independence to contracting partners).
Formal and informal FIGs exist in Russia, primary passed through registration in governmental organs (Order of the RF State Property Committee dated October 17, 1994 No 2522-r (edited April 11, 1995) «On the list of documents, submitted to the RF State Property Committee at the Formation of Financial Industrial Groups»), and second ones really function, but not just «advertise» their activity.
FGP can be formed in the form of an open joint-stock company, which has functions of a parent company or a single legal person, controlling other group participants, is assigned/elected. As a rule, participants delegate a part of their powers, right to dispose property and earnings to the managing board at the entry into agreement, and are jointly and severally liable on the debt of the parent company, originated in the course of fulfillment of entrepreneurial activity (Article 14 of the Federal law «On FIG”). It is necessary to mention that Article 14 contradicts to a number of civil legislation standards. Thus, in accordance with Article 105, Civil Code of the Russian Federation, part 2, «the associated company it not liable for debts of the parent company», and under certain conditions it indemnifies for losses of the associated company (par. 2, 3 Article 105, par. 3 Article 56, Civil Code of the Russian Federation, Article 3 FZ «On Cooperative Associations» No 208-FZ, Article 3 and Article 6 FZ «On the Limited Liability Companies» No 14-FZ) The stated standards are compulsory and cannot be modified by other acts, inclusive of the Law on FIG.
At FIG creation in Russia the following priority areas of activity were supposed to be developed:
— major industries;
— mechanisms of the organization and methods of FIG financing (stimulation of market participants with respect to FIG creation, franchising, resistance to monopoly, efficient distribution of financial and other resources between FIG participants, observance of interest of small and large manufacturers);
— regional, interindustrial and interrepublican priorities (creation of regional FIGs with the diversified structure, modernization and development of economic ties between regions and former republics of union state, by means of creation of transnational industrial groups).
At present, there is a tendency of grading of FIG role on account of strengthening of the role of law-enforcement agencies and governmental authorities.
Coglomerate is an integrated structure, consisting of various companies, united under a single financial control.
Conglomerate has the following peculiar characteristics:
— enterprises, being a structural constituent of conglomerate, usually have neither technological, nor production similarity with the primary focus of a parent company. It is rather difficult to define a basic sphere of conglomerate activity;
— parent company allows dependent companies performing legal and production and economic activities independently, preserving full financial control;
— considering that conglomerate gives greater freedom to its «daughters» and autonomy, in comparison with other organizational structures (for example, holdings), management has a decentralized character;
— the basic conglomerate control levers are financial and economic ones;
— the financial core is formed in conglomerate structure, which accumulates all financial flows and consists of investment and financial companies.
The main mechanism of conglomerate formation is an integration process of companies from various spheres, industries, and activity categories. The following objectives of the given economic phenomenon are as follows:
— increase of company efficiency as a result of union of smaller companies, as compared to the overall effectiveness of its disjecta membra before union (synergetic effect);
— appearance of competitive advantage;
— great awareness on the market composition and individual industries;
— greater opportunities appear for the resource use and new technologies in production;
— promotion of company status at the market;
— more efficient use of management instruments for the rise of managerial staff income.
However, against all the odds of conglomerate advantages, experts distinguish the following major problems, leading to the fall of profitability of integration structures:
— diversification of conglomerate can lead to the deterioration of competitivity, output;
— vast means, which are extracted by conglomerate from its reserves for the payment of shares of reacquired companies, means for the indemnity payment to shareholders («golden parachutes»), also motivation problems with managerial personnel emerge, which change the participants from the category of owners to the category of salaried employees as a result of such union;
— fragmentation of production conglomerate area blurs financing, leading to ineffective use of funds in separate units, and, eventually, inefficiency of work of the whole conglomerate.
Thus, a successful and mainly efficient conglomerate activity depends on the coordinated and purposeful actions of top managerial staff, their qualification and experience, i.e. the creation of effective management system and conduction of restructurization programs.
Cartel (informal corporate entity) is an agreement (usually not supported by a legal document) between legally and economically independent enterprises, trading at one market and manufacturing one type of goods. The essence of the contract is the evaluation of price level for the turn out products, production capacity and marketing outlets. Thus, the cartel establishes control over the market segment, where the activity is performed. As a result competition at the market decreases considerably or disappears fully. Cartel formation falls within antimonopoly legislation, and such formations are in the majority of countries (like the USA). The USA actively resists the creation of cartel structures by OPEC type by foreign countries in oil and gas sphere. Thus, the possibility of «gas alliance» creation with the participation of Russia, Algeria, Libya, republics of Central Asia, which can, in NATO’s opinion, become a powerful world organization on the OPEC model , is of prime example concern of NATO. Cartels are divided into desirable and destructive in Western Europe.
Regulatory control of cartel agreements in Russia is carried out on the grounds of Federal Law No 135-FZ «On Protection of Competition» dated July 26, 2006. (hereunder referred to as the Law) Thus, Article 10 of the Law prohibits actions of the company, occupying a dominant position at the market, prevention, elimination, or limitation of competition. «Agreements between economic entities or concerted practices of economic entities in the goods markets are forbidden if such agreements or concerted practices lead or can lead to: (Article 11 of the Law):
— establishment or maintaining of prices, discounts, extra charges, and margins;
— division of the goods market according to the territorial principle, the volume of sales, the composition of sellers or purchasers;
— imposing contractual terms on a counteragent, which are disadvantageous for the latter or are not connected with the subject of agreement;
— creation of barriers to entry into the goods market;
— establishment of conditions for the membership in professional and other associations, if such conditions lead to elimination of competition, etc.».
Generally, it is rather difficult for the anti-monopoly authority to establish a fact of presence of cartel agreements between companies, for example, on the establishment of the determined price for marketable goods.
As noted above, agreements in the form of a single legal document are not common. Furthermore, even if they were documented, they could not be valid and would be considered null and void by virtue of direct contradiction to the legislation (Article 186, Civil Code of the Russian Federation — CC RF).
1) It goes without saying that documented agreements might be essential in witness of the cartel agreement in the examinations of Federal Anti-Monopoly Service (FAMS). However, companies, joining cartels, usually stipulate not only price formation mechanisms and volumes of output, but also the monitoring procedure for the activity of the party to the agreement. Accordingly, in case of presentation of a claim on the part of the anti-monopoly service, the colluders can easily build their defense on the uncontroverted and economically feasible proofs of the price control or company load establishment. In this connection, it is rather difficult to prove a cartel agreement without the attraction of one of the parties to an agreement to collaboration. (Cartel Agreements in Conditions of Russian Market / Картельные соглашения в условиях российского рынка // РЦБ. 2008. № 16 (367). Компания эмитент http://www.rсb.ru/kе/2008-16/14383/).
There are other unformal business-formations in the world practice complementary to cartel, which possess corporation features, but are not juridical persons at the same time. They are as follows: syndicates, consortia, offshore areas, associations and unions.
The Electronic Economic Dictionary (Economic Dictionary http://аbс.infоrmburеаu.com/html/neiaeeaо. html) defines syndicate (from Greek syndikos – acting together) as an «organizational form of monopoly associations, when its companies lose their commercial sales independence, but keep legal and financial liberty of actions». A specially formed body is engaged into the production distribution, which individually decides, where and how the manufactured goods on all syndicate enterprises will be delivered. The work of syndicates, as well as of cartels, is under the observation of antimonopoly services, monitoring the impact of union activity on the market development. A classical example of syndicates is a diamond syndicate «De Burs».
Pool is an association of cartel type, however, contrary to previously considered associations; it performs not only the distribution of sales market, but also the realized profit. At first all profit is accumulated in one place, and then, as previously agreed and with the approved mechanism, is distributed among pool participants. One of examples is Moscow Interbank Transfer Pool (MITP), created in the year 1998. at the initiative of Moscow Mayor Yu.M. Luzhkov, «for the purpose securing uninterrupted transactions within the capital budget». The participants of these banks are as follows: Moscow Municipal Bank, bank of Moscow, Mossbusinessnank, Moscow industrial Bank, bank «Ogni Moskvy», Moskvodokanalbank, Moscow Export-Import Bank, AK «Businessbank», AKB «Peresvet», KB «Zenit», KB «Forpost», and Tehnobank.
A temporary alliance of legal persons, the objective of which is the realization of high-priced project, investment into the industrial trading enterprises, mass media, new technologies, oil-and-gas production etc. receives the name of consortium in economic literature. Consortia are formed as parts of various entities. Generally, a leading consortium company is selected, which coordinates activity of participants for the remuneration (interests from the total profit). The example of consortium is «Alpha-Group», which is one of the largest private financial and industrial consortia in Russia. Its sphere of activity is spread to oil and gas production, commercial and investment, banking operations, assets management, insurance, retail trading, telecommunications, innovative technologies, mass media, as well as investments in manufacturing and trading enterprises and investments on the sample basis. The leading company for the given association is Alpha-Bank.
Associations and unions are a non-commercial association of commercial organizations, aimed at the regulation of their entrepreneurship and defense of common property interests.
By the decision of participants, the association (union) can be imposed a task of business activity; in this case the association transfers the economic society or partnership association in accordance with the Civil Code of the Russian Federation (part one).
Public and other nonprofit organizations, including institutions, according to Article 121 par. 2, Civil Code of the Russian Federation, part 1) may be united voluntary into associations (unions) of these organizations. Association (union) participants preserve their independence and corporate powers (Article 121 par. 3, Civil Code of the Russian Federation, part 1)). At the same time the association (union) does not bear responsibility on the liability of their members, and at the same time, as the association (union) members bear joint responsibility on its liabilities in the size and order, stipulated by the foundation of documents of the association (Article 121 par. 4, Civil Code of the Russian Federation, part 1)). The name of the association (union) should contain the indication on the main activity object of its participants with the inclusion of word «association» or «union» (Article 121 par. 5, Civil Code of the Russian Federation, part 1)). This form of associations is well spread in Russia and exercises a significant influence on the development of the economy within the country. For example, «Association «League to Support Defense Industry», «Association of Joint Venture Companies, International Associations and Organizations», «Russian Association of Leasing Companies» etc. offshore areas. The name itself comes from the English word «offshore» and is translated into Russian as «out of shore» «out of boundaries». It is one of the most efficient methods of tax planning in the modern world. The essence of this method consists in the application of a privileged regime, which is fixed in the country legislation, attracting a foreign entrepreneur (non-resident) for the purpose of entrepreneurial work in the territory of the given country.
The term offshore first appeared in the USA at the end of 50s and had a negative connotation. The fact is that the emergence of this notion is associated with the activity of one financial organization in the USA, which was able to avoid government control and limitation due to the territorial transfer of its activity.
Currently there are over 60 countries all over the world, which legislation is ready to provide favorable conditions of business conduct for offshore companies.
The countries, which register offshore companies, may be classified as follows:
— countries with low level of development, but comfortable political situation (British Virgin Islands, Seychelles, Bahama Islands);
— countries, in which both off-shore, and usual non-resident companies exist, which carry out the economic activity inside the country (Cyprus, Ireland, Gibraltar, Luxembourg, Switzerland, Isle of Man);
— countries, unrelated to off-shore, but which can give concessionary terms for business (the USA, Great Britain, Canada).
Russia has no legislation, regulating the activity of offshore organizations, therefore business on consultations, support and opening of offshore companies is prosperous, which encourage capital export from the country, with all subsequent economic results. Offshore zones in Russia are located in Ingooshetia, The Republic of Kalmykia, the Republic of Altai, Buryat Autonomous District.
Free economic zones (FEZ) possesse the most optimal conditions for the purpose of business activity in conditions of Russian reality, as they have specific rules, regulating the economic relations. FEZ in Russia, are situated in the Lipetsk Region, Kaliningrad, Saint Petersburg etc.
Considering current form of corporate entities, it is necessary to refer to the research of formation (genesis) of existing corporate economy sector. Let us consider the stages of formation from the institutional point of view, which, fin our opinion, allows detecting the fundamental problems of further development of economic sector that is the most topical in conditions of the world financial crisis. We will try to solve the following problems at the later stage of our research:
— revelation of reference conditions of institualization and market transformation of socioeconomic sphere;
— evaluation and characteristics of basic stages and formation mechanisms of a contemporary corporate sector in the Russian economy;
— revelation and formulation of fundamental problems and tendencies of corporate economy sector.
To our opinion, it does not make sense, to associate the formation of corporate economy sector with the transfer of Russia from socialistic way of development to the market one. The fact is that such a statement is not quite correct, as large national unions with corporation features emerge at the beginning of the 70s. Enterprises-giants, performing their activity in accordance with the government order, acquired peculiar features in conditions of planned economy, which were later borrowed in the period of early development of corporate entities:
— formation of stable informal relations between economic agents (these relations originated in conditions of resource deficiency, as the result of which interpersonal relationships became determining in the course of fulfillment of basic productive activity);
— the overgrown officialdom, performing controlling and distributing, and planning functions, later lead to the fact that interested individuals could lobby through their interest on the conversion of national property through the utilization of relations in ministerial structures,
— by the end of the 1980s the economy was in a standstill condition and acute consumer deficiency, the industrial complex accomplished the governmental contract, focused on the meeting of needs of the military industrial sector;
— political instability, breakup of the Soviet Union and redistribution of economic resources between the former Union Republics, being a part of it;
— agreement of transformational processes in Russia with expansion of economic integration limits, which is the basic element of the international globalization.
Further political and transformational processes have lead to the evolution of economic institutions, inclusive of corporate entities.
We distinguish six principal stages of economic corporate sector formation in the subsequent issues, on the basis of fundamental regulatory act evolution. As it is known, standards are fundamental elements in relations between individuals. Their activity coordination is carried out with their help. Existence of standards secures the predictability of individual behavior and their efficient interaction. Consequently, standard is an intermediate party between macro- and microlevels. Following to customaries secures the action coordination with counterparts, which eventually secures the reliability of the entire system. Therefore, we consider that this classification reflects the process of origin and development of corporate entities in Russia.