The Commonwealth has often been likened to an English gentlemen's club, and the issue of who is and who is not a member often seems to be more important, and certainly attracts much more attention, than what the organisation actually does. This is because the main benefit of membership is the opportunity for close and relatively frequent interaction, on an informal and equal basis, between members who share many ties of language, culture, and history.

In its early days, the Commonwealth also constituted a significant economic bloc. Commonwealth countries accorded each others' goods privileged access to their markets ("Commonwealth Preference"), and there was a free or preferred right of migration from one Commonwealth country to another. These rights have been steadily eroded, but their consequences remain. Within most Commonwealth countries, there are substantial communities with family ties to other members of the Commonwealth, going beyond the effects of the original colonisation of parts of the Commonwealth by settlers from the British Isles. Furthermore, consumers in Commonwealth countries retain many preferences for goods from other members of the Commonwealth, so that even in the absence of tariff privileges, there continues to be more trade within the Commonwealth than might be predicted. On Britain's entry to the European Community, the Lomé Convention preserved some of the preferential access rights of Commonwealth goods to Britain's market.

But in recent decades there has been a mutual decline of interest in maintaining active inter-Commonwealth relations, and the organisation's direct political and economic importance has declined. Realist critics have argued that in the 21st Century the organisation is an inherently arbitrary alliance with members that are united only through a historical accident of British colonialism. They argue that the organisation lacks a balanced membership, and point out that it is very unusual for any international organisation to exclude highly important regions of the world such as most of Western Europe and South America from membership. Indeed, many Commonwealth members look increasingly to regional partners, non-Commonwealth as well as Commonwealth, to form their most important alliances. Such criticisms aside, and however arbitrary the origins of Commonwealth membership, the fact remains that shared legal, economic, and governmental traditions give its members a common outlook that is not always shared with regional partners.

Britain has forged closer relationships with other European countries through the European Union; this was widely felt as a betrayal by citizens of the "Old Commonwealth" whose economies had been developed on the assumption of access to British markets. Similarly, former British colonies have forged closer relationships with non-Commonwealth trading partners and closer geographic neighbours. Reaction to immigration from the new Commonwealth countries into Britain in the 1950s and early 1960s led to the restriction of the right of migration. The Commonwealth today mainly restricts itself to encouraging community between nations and to placing moral pressure on members who violate international laws, such as human rights laws, and abandon democratically-elected government. Key activities today include training experts in developing countries and assisting with and monitoring elections.

Some Commonwealth countries give Commonwealth citizens privileges that are not accorded to aliens. For example, in Britain the right to vote is given to all Commonwealth citizens resident in that country. This is reciprocated mainly in the Commonwealth Caribbean, even to the point that in some countries (including Britain) resident Commonwealth citizens may even be elected or appointed to the national legislature. But these privileges are largely not reciprocal, and it is up to each country to decide what privileges it accords to Commonwealth citizenship, except for the Commonwealth Scholarship. Other privileges that Britain grants Commonwealth citizens include access to immigration programmes such as the working holidaymaker visa. Some privileges offered by individual countries have eroded over the last few decades, but most countries continue to afford special treatment for immigration (e.g. right of abode in UK for some) and visas. Commonwealth citizens are also eligible to join the British armed forces.