The Different Types of Shareholders in a Business

Institutions or individuals who have shares in a corporation http://companylisting.info/2021/04/15/how-to-register-a-business-name/ are the various types of shareholders. Shareholders have many legal rights, including the right to vote on corporate matters, to receive dividends, and take advantage of assets in a liquidation. Companies of all sizes and sectors provide a wide range of products and services. Amazon is one example. It sells everything from books to kitchen gadgets. Apple is known as a manufacturer of innovative electronic devices, such as smartphones, watches, earphones, and personal computers.

In general there are two types of shareholders: common and preferred. Common stock owners have a limited ownership of the company and are entitled to voting rights and a percentage of profits (if there is any). Typically, this kind of share has higher rates of return over a long period but may not guarantee a specific yearly dividend. Common stockholders are entitled to examine company records, including meeting minutes and shareholder lists.

Preferred shareholders receive a yearly dividend in addition to having priority over common stockholders in the event of liquidating the company’s assets. They are not able to vote on board members or other company policies. The term « shareholders » is synonymous with « stakeholders, » but stakeholders are a broad term that includes employees and customers, as well as local communities and suppliers. Shareholders are directly involved in the performance of a company.