From Wikitia
Jump to navigation Jump to search

A shareholder (also known as a stockholder in the United States) of a corporation is an individual or legal entity (such as another corporation, a governmental body, a trust, or a partnership) that has been registered by the corporation as the legal owner of shares of the share capital of a public or private corporation. Members of a corporation are also referred to as shareholders in a corporation. It is only when a person or legal entity's name and other details are entered in a corporation's register of shareholders or members that the person or legal entity becomes a shareholder or member. Unless otherwise required by law, a corporation is not required or permitted to inquire as to the beneficial ownership of the shares held by the shareholder or member. The majority of the time, a business cannot own its own stock.

The amount of influence a shareholder has on a company is defined by the percentage of shares held by that shareholder. Unlike the business itself, shareholders of a corporation are legally distinct from the corporation. Shareholders are normally not accountable for the debts of the business, and the shareholders responsibility for corporate debts is stated to be restricted to the amount of the unpaid share price in the absence of assurances from a shareholder. In order to record beneficial ownership of a shareholding, the company just has to enter the name of the person who holds the shareholding in the corporate register. It is assumed that when more than one person is listed as the owner of a shareholding, the first person listed as the owner is in command. The firm will communicate with that individual via all letters and other means.

Shareholders may have bought their shares in the main market by subscribing to initial public offerings (IPOs), so contributing to the corporation's capital. However, the majority of owners purchase their shares on the secondary market and do not contribute any cash to the organisation directly. Shareholders may be awarded specific advantages based on the share class in which they hold their shares. The board of directors of a company is responsible for the overall governance of the business for the benefit of its stockholders.

Stakeholders, according to some, are a subset of stakeholders, which might include everyone who has a direct or indirect interest in a company's operations or financial performance. Employees, suppliers, consumers, the community, and other stakeholders, for example, are often regarded as stakeholders because they provide value to the organisation or are influenced by the firm.