Corporate governance networks have grown exponentially over the past decade, as more and more companies have sought to control the pace of their operations and influence decisions at every level of the organization.
With so many companies, it can be difficult to distinguish between an active corporation and an inactive entity.
The following infographic shows the evolution of the corporate governance landscape over the last decade, showing the evolution in how many entities there are in the world today.
In some cases, there are more than 100 companies and each of them has its own set of rules and guidelines for operating within the corporation.
Companies can be classified into three types of entities: active companies, non-active companies, and inactive entities.
Active Companies Active companies have no formal structure or corporate governance structure.
The majority of companies in the corporate hierarchy are either fully or partially incorporated, with only a handful of entities that are not.
Active companies can operate on a corporate tax base of $50 billion per year.
The most active companies in 2017 were Facebook ($5 billion), Google ($4.4 billion), Microsoft ($3.8 billion), Apple ($3 billion), and Amazon ($2 billion).
These companies have more than doubled their share of the global corporate governance pie since 2015, rising from 19% in 2014 to a peak of 45% in 2017.
They also have a $4.5 trillion in market cap.
Google’s market cap jumped from $3.5 billion in 2015 to $5.5.6 billion in 2017, while Amazon’s market value climbed from $1.8 trillion in 2016 to $2.1 trillion in 2017 and Microsoft’s market share grew from 7% to 22%.
Apple’s market capitalization climbed from a low of $1 billion in 2016, to a high of $21.7 billion in 2018, but it has dropped to $12.4 million in 2019.
The $5 billion of revenue Apple generated in 2017 came from operating a $200 billion operating profit and $2 billion from operating income.
This is a significant increase from the $400 billion in revenue it earned in 2015.
Microsoft, meanwhile, grew its share of global revenue to 37%, but its share decreased from 21% in 2015, to 10% in 2016 and to 7% in 2018.
Its market cap grew from $10.3 billion in 2019 to $21 billion in 2020.
Google, Amazon, Apple, and Microsoft are all active in terms of their revenue, but Apple is the biggest company on the planet with more than $100 billion in market value.
The remaining corporations that have more or less no formal corporate structure are also not active.
Non-Active Companies Non-active corporations are companies that have no specific corporate structure.
They may not be incorporated and they may not have a formal corporate governance framework.
The non-activity category includes companies that operate primarily as independent organizations, but are not incorporated or have formal corporate structures.
These include companies that are private corporations, public corporations, partnerships, limited liability companies, or non-for-profit corporations.
The Non-activity categories grew from 8% in 2020 to 25% in 2021.
They now comprise $3 trillion in global market capitalizations.
The total number of non-Active corporations increased from 9% in 2019, to 27% in 2022.
It now represents a staggering 37% of global corporate revenue, an increase of $6 trillion over the previous year.
These companies are largely based in Asia and Latin America.
Nonactive entities are comprised of companies that either have formal organizational structures or are private companies, partnerships or limited liability corporations.
These are companies with no formal business or legal structure.
These non-activities include private companies that do not have formal business relationships with any other companies, public companies, limited partnerships, or nonprofits.
These businesses are based in the United States, Europe, and Asia.
The US and Europe are the most active non-actively-corporate regions, but the non-dominant markets in Africa and Latin American are also active.
The next largest non-actives in the US are the Chinese, with a total market capitalisation of $5 trillion.
The Chinese are also the largest nonactive economy in the Americas, with total market cap of $3 billion.
The biggest non-Activities in the region are the US, with the US accounting for 37% market share.
The UK and Australia also represent active economies, but their markets are largely small.
Nonactivities in Asia are mainly based in China, with Japan accounting for 12% market value, and South Korea and Taiwan are the next most active.