They are typically "organisations with independent corporate status, managed by an executive board appointed primarily by local government officials, and with majority public ownership.
Corporatization may be more utilised locally rather than nationally allowing more hybrid or flexible forms of public service delivery such as public-private partnerships and inter-municipal cooperation.
Current research shows that municipally owned corporations are frequently more efficient than bureaucracy but have higher failure rates because of their legal and managerial autonomy.
The state-owned enterprises that resulted were to be organized akin to private corporations, with the difference that the company's shares remain state ownership are not traded on the stock market.
Municipal corporation followed a process of externalization that required new skills and orientations from the respective local governments, and followed common changes in the institutional landscape of public services.
[6] Such externalization gives the service delivery organization legal and managerial autonomy from politicians, which could potentially increase efficiency, because it safeguards the firm from political exploitation.