The Different Types of Shareholders in a Business

Individuals http://companylisting.info/2021/04/23/boost-your-local-visibility-with-google-places-listing/ or institutions that own shares in a business are the various types of shareholders. Shareholders have various legal entitlements that permit them to vote on corporate matters as well as receive dividends and a claim on the company’s assets in the event of liquidation. The different kinds of businesses across the globe offer many different products and services, which vary by industry and size. For instance, Amazon sells a variety of items ranging from books to kitchen appliances, and Apple is known for its unique electronic devices such as personal computers, smartphones as well as earphones, watches and other gadgets.

In general there are two types of shareholders: common and preferred. Anyone who holds common stock enjoys some ownership of the company This means they are entitled to vote rights as well as a portion of the company’s profits (if there is profit). Typically, this type of share is more likely to earn a higher return over the long term but it’s not guaranteed to pay the exact amount of a dividend each year. Common stockholders are entitled to look over the company’s records, including shareholder lists and meeting minutes.

Preferred shareholders receive an annual guaranteed dividend and are entitled to preference over other stockholders in the event of liquidating assets. They are unable to vote for the board members or any other policies of the company. The term « shareholder » could be used interchangeably with the phrase « stakeholder, » but stakeholder is a broad term that includes employees, customers as well as local communities and suppliers and shareholders are directly invested in the profitability of a company.