SHS

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Understanding Culture, Society & Politics

Module 7: Forms and Functions of
State and Non-state Institution
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Understanding Culture, Society & Politics
SHS-Module 7: Forms and Functions of State and Non-state Institution
First Edition, 2020

Copyright © 2020
La Union Schools Division
Region I

All rights reserved. No part of this module may be reproduced in any form
without written permission from the copyright owners.

Development Team of the Module

Author: Magdalena Paz H. Lazo, TIII

Editor: SDO La Union, Learning Resource Quality Assurance Team

Reviewer: Mario V. Mario Jr.

Mario B. Paneda, Ed.D., EPS in Charge of Araling Panlipunan

Belen C. Aquino, Ph.D., EPS in Charge of English

Illustrator: Ernesto F. Ramos Jr., P II

Layout Artist: Ernesto Ortiza Jr., TIII

Management Team:

ATTY. Donato D. Balderas, Jr.

Schools Division Superintendent

Vivian Luz S. Pagatpatan, Ph.D

Assistant Schools Division Superintendent

German E. Flora, Ph.D, CID Chief

Virgilio C. Boado, Ph.D, EPS in Charge of LRMS

Mario B. Paneda, Ed.D, EPS in Charge of Araling Panlipunan

Michael Jason D. Morales, PDO II

Claire P. Toluyen, Librarian II
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SHS

Understanding Culture, Society & Politics

Module 7:
Forms and Functions of State and Non-state
Institution
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Target

Society consists of social structures and social institutions that are governed
by norms and values. Each individual in a society has specific roles and functions that
are meant to achieve balance in the society. However, the pursuit of interests
generates various conflicts in the society. Competition over resources is often the
source of conflict.

By the end of World War II, various humanitarian issues and crises took place.
More than 6 million was displaced at the end of war. Faced with this large-scale of
humanitarian crisis, international community responded with various measures
including the establishment of the Office of the United Nations High Commissioner for
Refugees (UNHCR) in 1950.

The large-scale of human predicament show how human rights are being
violated by the institutional actors such as government. This incidence leads to the
creation of state and nonstate institutions. These institutions became relevant in the
advent of globalization and urbanization.

After going through this module, you are expected to explain the different form
and functions of state and non-state institutions.

Specific Objectives:
a. identify the different forms and functions of state and non-state
institutions;
b. describe each form of state and non-state institutions;
c. explain how state and non-state institutions function.

Before going on, check how much you know about this
topic. Answer the pretest on the next page in a separate
sheet of paper.

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Pretest
Direction: Carefully read each item. Write the letter of the best answer. Use separate
sheets for your answers.

1. What form of business governed on the principle of one member, one vote?
A. Cooperatives C. States
B. Corporation D. Unions
2. What organization of the state which makes, implements, enforces, and adjudicates
the law?
A. Cooperatives C. Government
B. Corporation D. Trade Unions
3. What institution that allows people deposit their money for safe keeping and
interests?
A. Banks C. Corporation
B. Cooperatives D. Lending Company
4. What institution is made up of individuals, shareholders or stockholders who
engage to business?
A. Banks C. Corporation
B. Cooperatives D. Trade Unions
5. What type of corporation that are formed to generate revenues and provide returns
to their shareholders?
A. For-Profit C. Trade Groups
B. Not-for Profit D. Union Groups
6. What type of corporation that operates under the category of charitable
organization?
A. For-Profit C. Trade Groups
B. Not-for Profit D. Union Groups
7. What business organization that extends production and sales into several
countries?
A. International Government Organization C. Multinational Corporations
B. International Organization D. Transnational Groups
8. What organization is formed by workers for common interests of their co-workers?
A. Banks C. Corporation
B. Cooperatives D. Trade Groups
9. What organization whose activities transcend to national boundaries to facilitates
cooperation?
A. International Organization C. Trade Unions
B. Multinational Corporations D. Union Groups
10. What form of government in which supreme power is absolutely lodged with an
individual?
A. Democracy C. Oligarchy
B. Monarchy D. Theocracy

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Jumpstart

Accomplish the activity below. This will help you understand the
lesson. Have fun and good luck!

Activity 1: Unscramble the Letters

Direction: Unscramble the letters to identity the concepts being described.

Scramble Letters Description Answer

An organized political
ATEST community acting under a
government and united by
common set of laws
A form of business
operation that declares the
business as a separate
RANIOTROC entity guided by a group of
officers known as the
Board of Directors.

The governing body of

RNVEGOTENM
the state or nation

A financial institution
licensed to provide several
SKABN financial services to
different types of
customers.
Organizations formed
by workers from related
DETRA ONUNI fields that work for
common interest of its
members
Businesses governed
TIVESOOCPERA on the principle of one
member, one vote

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Discover

State
At the time of the initial development of the modern human rights system,
States were the dominant actors in the international arena.
A state is an organized political community acting under a government and
united by common set of laws. It uses absolute power in directing the path of a
society. It also uses complete political coerciveness, which may come in the form of
armed forces personnel, stricter laws, and rigid government policies in order to attain
its societal goals and objectives.
Market exchange is the primary form of economic subsistence of a state
wherein standardized currencies are being used to exchange commodities.
States differ in sovereignty, governance, geography, and interests. It may be
classified as sovereign if they are not dependent on, or subject to, any other power or
state. Other states are subject to external sovereignty where ultimate sovereignty lies
another state.
The concept of the state is different from the concept of government. A
government is the particular group of people that controls the state at a given time. In
other words, governments are the means through which the state power us employed
like applying the rule of law.
The concept of the state is also different from the concept of a nation, which
refers to a large geographical area and the people therein who perceives themselves as
having a common identity. The state is a political geopolitical entity; the nation is a
cultural or ethnic entity.
As a state, it consists of actors with varying interests and assertions, social
rules are implemented in the forms of laws. These laws are created to manage the
interaction among individuals and between the individuals and the state. As a citizen
of a country, an individual is subjected to the legal norms in the territory. These
norms may include paying taxes, rendering military services, and contributing to the
political life in the society.
The State intends to be a strong actor in the performance of the three
important political functions. The state, in full form,
1. maintains control over violence in its domain
2. allocates resources and rewards at its discretion, and
3. stands as the major focus of identity for the large majority of the people
under its authority.

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Elements of the States
1. Population
It is the people who make the state. Population is essential for the state.
Without population there can be no State.
2. Territory
There can be no state without a fixed territory. People need territory to live
and organize themselves socially and politically. It may be remembered that
the territory of the states includes land, water and airspace.
3. Government
It is the organization or machinery or agency of the State which makes,
implements, enforces, and adjudicates the laws of the state.
4. Sovereignty
It is the most exclusive elements of State. Without sovereignty no state can
exist. State has the exclusive title and prerogative to exercise supreme
power over all its people and territory. It is the basis which the State
regulates all aspects of the life of the people living in its territory.

Forms of States
States come in a variety of forms that vary on who holds power, how positions
of leadership are obtained, and how authority is maintained. These are:

a. Authoritarian Government
Authoritarian governments differ in who holds power and in how
control they assume over those who govern. An example of this type is
Monarchy.
Monarchy is a form of government in which supreme power is
absolutely lodged with an individual, who is the head of the state, often
for life or until abdication. The person who heads a monarchy is called a
monarch. Some monarchs hold unlimited political powers while many
constitutional monarchies, such as the United Kingdom and Thailand.
Currently, 44 nations in the world have monarchs as head of state.
Totalitarianism is a political system that strives to regulate nearly
every aspect of public and private life. It theoretically permits no individual
freedom and that seeks to subordinate all aspects of individual life to the
authority of the state. Modern examples of totalitarian states include the
Soviet Union under Joseph Stalin, Nazi Germany under Adolf Hitler, the
People’s Republic of China under Mao Zedong, and North Korea under the
Kim Dynasty.

b. Oligarchic Government
An oligarchy is a form of government in which power effectively rests
with a small-elite segment of society distinguished by royalty, wealth,
family, military, or religious hegemony. An oligarchy does not have one clear

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ruler, but several powerful people who rule. One common example is
theocracy.
Theocracy is a government by divine guidance or by official who are
regarded as divinely guided. Leaders are members of the clergy, and the
state’s legal system is based on religious law. Contemporary examples of
theocracies include Saudi Arabia, Iran, and the Vatican.

c. Democratic Government
Democracy is a form of government in which the right to governs is
held by the majority of citizens within a country or a state. The two
principles of democracy are that all citizens have equal access to
power and that all citizens enjoy universally recognized freedoms and
liberties. People can either become country leaders through electoral
process or elect leaders who represent the core values and beliefs.
There are 99 democratic nations globally. Examples of democratic nations
are Philippines, Norway, New Zealand, United States of America, Canada,
Columbia, Italy, and South Africa.

Roles of the States

1. State provides security against external aggressions and war. For this
purpose, the state maintains an army.
2. State ensures security against internal disturbances disorders and crimes.
For this purpose, the state maintains police.
3. State legally grants and guarantees the rights of the people.
4. The state issues and regulates currency and coinage.
5. State undertakes steps for the creation of necessary conditions for the
socio-economic-politico-cultural development of the people.
6. State grants citizenship and protects their interests and rights.
7. State conducts foreign relations, foreign trade and economic relations.
8. State secures the goals of national interest in international relations

Nonstate Institutions
Nonstate institutions are people and/ or organization that participate in
international affairs and relations but are not affiliated with any state or nation.
These nonstate institutions include the following: bank and corporations,
cooperatives and trade unions, transnational advocacy groups, and development
agencies and international organizations. These nonstate institutions are equally
capable of influencing policy formation and implementation.
a. Banks
Bank is a financial institution licensed to provide several financial
services to different types of customers. Banks are in operation mainly for
their deposits and lending functions. Customers are allowed to deposit their

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money to banks which grow through an interest rate. Banks also provide
loans, with an interest to customers who need money either for personal
consumption or for investment and businesses. Banks may be categorized
into major forms such as commercial banks and investment banks.

Table 1. Major forms of banks and their description

Forms of Bank Description

Commercial Banks  Financial deposit with security and convenience
which could be in the form of credit cards, debit
cards, and check
 Provide business, individual, and personal
loans, enabling commercial banks to earn
interest
 Serve as payment agents within and outside the
country through wire transfer
 Subjected to more regulations
Investment Banks  Financial intermediaries that performs a variety
of services for businesses and some government
 Issues securities to the investing public
 Make markets, facilities, mergers, and other
corporate reorganizations
 Acts as brokers for institutional clients
 Under the supervision of regulatory bodies such
as the Securities and Exchange Commission
(SEC), FINRA, and the US Treasury
 Subjected to fewer regulations
Source: https://www.investopedia.com/ask/answers/061615/what-are-major-
categories-financial-institutions-and-what-are-their-primary-roles.asp

The two most well-known financial institutions that are actively

shaping the socioeconomic development of the Philippines are the World
Bank and the Asian Development Bank. They have been providing financial
aid to the Philippine government and various non-governmental
organizations (NGOs) to facilitate their development objectives.

b. Corporations
It is a form of business operation that declares the business as a
separate entity guided by a group of officers known as the Board of
Directors. They were created by individuals, stockholders or shareholders,
with the purpose of operating for profit. They have all legal rights of an
individual, except for the right to vote and certain limitations. They are given
the right to exist by the state that issues their charter. Corporation example

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includes General Motors Corporation an icon of American craftmanship,
Apple Corporation as one of the famous tech companies, Amazon
Corporation founded by Jeff Bezos is the world’s leading eCommerce and
innovation company, Domino’s Pizza is a global food chain company
delivering quality food worldwide.

Common Types of Corporations

A corporation can be created by a single shareholder or by multiple
shareholders who come together to pursue common goal. A corporate can be
formed as a for-profit or a non-for-profit entity.
 For-profit entities form most corporations, and they are
formed to generate revenues and provide a return to their
shareholders, according to their percentage of ownership in the
corporation. Examples: HBO in partnership with International
Rescue Committee, Ford Motors and Lynda.com.
 Not-for-profit entities operate under the category of charitable
organizations, which are dedicated to a particular social cause
such as educational, religious, scientific, or research purposes.
Rather than distribute revenues to shareholders, not-for-profit
organizations use their revenues to further their objectives. Human
Rights Campaign is a very impressive example of using Facebook
profile photos to spread the word far and wide about campaign.
Greenpeace the environmental non-profit that used GPS
technology to inform the public about their cause.

Multinational Corporations (MNCs) are business organization that

extends ownership, management, production, and sales activities into several
or more countries. MNCs are boon to the economic growth and development
of the states.

Table 1. The Good and bad Effects of MNCs

Good Effects Bad Effects

Introduce technology
Encourage economic growth
Encourage interdependently
Elites learn to regulate
Promotes human rights
Protect the environment
Economic actors
Promote a cosmopolitan world
Source: Conway Henderson (1998)
Offer ill-suited technology
Retard economic growth
Cause dependency
Elites become compradors
Harms human rights
Hurt the environment
Political actors
Damage national Culture

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Checks out the big names of MNCs that are already exist in the
Philippines:

 Google  HSBC
 Viber  Citibank
 Palo Alto Networks  Maersk
 Procter and Gamble  Hewlett Packard
 Thomson Reuters  Coca Cola Far East
 Accenture  Deutsche Bank

c. Cooperatives
Cooperatives are people-centers enterprises owned, controlled and
run by and for their members to realize their common economic, social, and
cultural needs and aspirations.
Cooperatives are businesses governed on the principle of one
member, one vote. There are several common types of co-ops, including
cooperatives owned and operated by:
a. The people working there (worker cooperatives);
b. The people buying the co-op’s goods or services (consumer
cooperatives)
c. The people collaborating to process and market their products
(producer cooperatives); and
d. Groups uniting to enhance their purchasing power (purchasing
cooperatives)

Cooperatives play a critical role in building community wealth for

several key reasons:
a. They often provide quality goods and services to areas that have
been shunned by traditional businesses because they are deemed
less profitable
b. They typically invest in local communities
c. Since most cooperative members are local residents, business
profits remain and circulate in the community
d. Cooperative membership builds social networks and strengthens
social cohesion which are essential elements of a strong, healthy
communities by connecting diverse community residents
e. Purchasing cooperatives help small, local businesses remains
competitive within markets dominated by large, national retailers
f. Worker cooperatives create quality, empowering jobs for
community members

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d. Trade Unions/Labor Unions
Trade Unions are organizations formed by workers from related fields
that work for common interest of its members. They help workers in issues
like fairness of pay, good working environment, hours of work and benefits.
They represent a cluster of workers and provide a link between the
management and workers.
The purpose of these unions is to look into the grievances of wagers
and present a collective voice in front of the management. It acts as the
medium of communication between the workers and management. Among
these trade unions that exist in the Philippines are the Federation of Free
Workers (FFW), Kilusang Mayo Uno (KMU) and the Trade Union Congress of
the Philippines (TUCP).
Functions of Trade Unions:
1. Advocating for fairness and equality for workers’ compensations
2. Securing better working conditions for workers
3. Trade Unions will organize strikes and demonstrations on behalf
of worker demands
4. Fight for social welfare for workers
5. Promote and advocate for education and proper training for
workers
6. Advocate and fight the government for legislative protections of the
workers
7. Promote and advocate for organizational growth and stability
8. Trade Unions acts as representatives of workers in national and
international forums
9. Involved in collective bargaining agreements and disputes with
management to settle any conditions on employment
10. Advising management on correct personnel policies and
procedures
11. Involved in collective and personal collective grievances between
management and workers.

e. Transnational Advocacy Groups

Transnational Advocacy Groups (TAGs) play an increasingly
important role in international and regional politics and have contributed to
changing policies of multilateral organizations and states. They are
particularly visible in contentious areas as human rights, environmental
issues, international peace, and women’s rights. They have specific roles to
partake that can be achieved through effective measures, case-specific
methods, and activities.
TAGs serve as international catalysts for change, aiming to achieve
international changes towards policies and practices. The very essence of

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TAGS is the formation and development of their advocacies and campaigns
that represent causes, ideas, values, and beliefs.
Human Rights Watch and Amnesty are active in the human rights
field. Oxfam and Save children deal with humanitarian issues. Greenpeace
and Friends of the Earth represent environmental concerns.

f. Development Agencies
Development Agencies have been established to develop the
cooperation between the public sector, private sector, and civil society.
These are organizations with specific aims and goals. The common
denominator among these organizations is the term development. These
agencies concentrate on the growth, progression, and advancement of
specific concerns, which can be infrastructure or social institutions.

Types of Development Agencies:

International Organization is an institution with
membership drawn from two or more countries. Its activities
transcend national boundaries as it facilitates cooperation among
its members in the performance of one or more tasks. The
international organization can be public or private. A public
organization is an international government organization (IGO) with
states as its members. Prominent examples of IGOs are United
Nations, the North Atlantic Treaty Organization (NATO),
International Monetary Fund (IMF), European Union (EU),
Association of Southeast Asian Nations (ASEAN), and World Health
Organization (WHO). A private organization has a membership of
individuals or groups and is an international nongovernment
organization (INGO) that originate for reasons other than politics
such as International Criminal Police Organization (Interpol). INGOs
may lobby or work regularly with the government and IGOs.
Non-government Organization is a non-profit group that
functions independently of any government. It serves the social or
political goals such as humanitarian and environmental causes.
Most NGOs aim to promote the practice of democracy among
societies and social change through their initiatives and
organizational methods. Many NGOs have targeted their efforts
toward population groups that tend to be underserved by
governmental programs, including women, the aged, physically and
mentally disabled persons, the poor, and various social groups that
have been marginalized by virtue of race, religion, ethnicity, caste,
and social class.

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Interrelationship of Government and Non-state Institutions
Government rules society. This reflects how powerful government institution
can be. If nonstate institutions interfere with the governing body, two possible things
can happen:
1. Integration among these two institutions may take place to achieve precise
solution towards development
2. Conflict and tension may also arise because one could exceed the other in
terms of societal control and influences (Penninx, 2013)

Explore

Mastering the lesson is our outmost priority. Below is an

enrichment activity that will help you master the lesson. Good luck!

Directions: Complete the table. Identify the non-state institutions and describe its
structure and functions.

Nonstate Institutions Structure Functions

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Deepen

The coronavirus COVID-19 pandemic is the defining global health crisis of our
time and the greatest challenge we have faced. The pandemic is much more than
health crisis but is also unprecedent socio-economic crisis.
You are the Secretary of Department of Health (DOH) and tasked to create or
organize your own non-governmental organization that will address the COVID-19
pandemic. To accomplish this task, create a simple project proposal using the
template below:

Name of the Organization

you will organize.

Purpose of the organization

(Why do you need to create
your organization)

Organizational Structure
(Officers/Personnel)

Funding Sources
(Ways and means to generate
your organization’s fund)

Organization’s Projects and

Activities

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Gauge

Directions: I. Multiple Choice. Carefully read each item. Write the letter of the best
answer. Use separate sheets for your answers.

1. What is the primary form of economic subsistence of a state?

A. Agriculture C. Foraging
B. Banking D. Market Exchange
2. What political term refers as a sovereign actor with a central government ruling
over population and territory?
A. Banks C. State
B. Government D. Trade Unions
3. What is the institution that membership is drawn from two or more countries?
A. Cooperatives C. International Government
B. International Organization D. Trade Unions
4. Which of the following organizations is NOT an example of IGOs?
A. International Monetary Fund C. North Atlantic Treaty Association
B. INTERPOL D. World Health Organization
5. What form of business operation declares the business as separate entity guided
by a group of officers known as the Board of Directors?
A. Cooperatives C. International Government
B. Corporation D. Trade Unions
6. What are the members of a public international organization?
A. Board of Directors C. Society
B. Private Business Owners D. States

7. What happens if the nonstate institutions interfere with the government?

A. Conflict and tensions may arise
B. Equal context of political and economic development
C. Equitable health and social development will be distributed
D. Nonstate Organization provides support and assistance through organized
frameworks
8. What licensed institution provides several financial services to different type of
customers to earn profits?
A. Banks C. State
B. Government D. Trade Unions

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9. Which of the following functions is NOT a function of Trade Unions?

A. Fights for Social welfare for workers
B. Advocation for fairness and equality for workers’ compensations
C. Trade unions will organize strikes and demonstrations on behalf of worker
demands
D. Support local and international groups to localize the implementation of
international policies

10. Which of the following statements is NOT a good effect of MNCs in a state?
A. Cause dependency
B. Introduce technology
C. Encourage interdependently
D. Encourage economic growth

II. TRUE or FALSE. Write True if the statement is correct and FALSE if the statement
is incorrect.

1. The state uses absolute power to attain societal goals and objectives.
2. Being a citizen of a state, everyone is entailing the enjoyment of certain privileges
that are called rights.
3. Investment Banks issues securities to the investing public.
4. Commercial Banks provide business and personal loans in orders to earn interest.
5. Transnational Advocacy Groups serve as international catalysts for change and
development.
6. A cooperative has a primary role of promoting labor welfare.
7. Most trade unions aim to promote the practice of democracy among societies.
8. The government plays a vital role in human society because it is expected that its
efforts and initiatives must be aligned with individual welfare and service.
9. One of the most important roles of banks is to translate agreed-upon values into
rights and obligation.
10. World Bank is an example of trade union.

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Deepen Deepen
II. I.
1. True 1. A
2. True 2. C
3. True 3. A
4. True 4. C
5. True 5. A
6. False 6. B
7. False 7. C
8. False 8. B
9. False 9. A
10. False 10. D
Answer Key
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References
Printed Materials:
Department of Education, Bureau of Secondary Education (2016). Teacher’s Guide.
Understanding Culture, Society and Politics. Pasig City, Philippines.
Custodio, Henry M. et al. (2016). Understanding Culture, Society and Politics.
Makati City. Diwa Learning Systems
Henderson, Conway E. (1998). International Relations. McGraw-Hill Companies.
Singapore.

Websites:

Interrelationship of Government and Nonstate Institution (n.d). Retrieved @

https://www.scribd.com/document/325614647/Interrelationship-of-
Government-and-Nonstate-Institutions
Transnational Advocacy Networks in International and Regional Politics. (2019, March
19). Wiley Online Library. Retrieved @
https://onlinelibrary.wiley.com/doi/abs/10.1111/issj.12187
State: Elements and necessity of the State. (2014, May 17). Your Article Library.
Retrieved @ https://www.yourarticlelibrary.com/essay/politics- essay/state-
elements- and-necessity-of-the-state/40323
SCP Module # 4: Non-State Institutions. (2018, October 1). Retrieved @
https://sklthebest.home.blog/2018/10/01/ucsp-module-4-non-state-
institutions/
Types of states | Boundless sociology. (n.d.). Lumen Learning – Simple Book
Production. https://courses.lumenlearning.com/boundless-
sociology/chapter/types-of-states/
INQUIRER.net. (2015, November 2). Top 5 reasons why multinationals are locating in
the PH. https://business.inquirer.net/201841/top-5 reasons- why-
multinationals-are-locating-in-the-ph
Transnational advocacy groups - Nongovernmental actors | Coursera. (n.d.).
Coursera. https://www.coursera.org/lecture/political-
economy/transnational-advocacy-groups-m1I4z

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