How do the shareholders of most corporations exercise their control of that corporation? A. by electing members of a board of directors B. by vetting the decisions of the board of directors C. by providing oversight of the dayminustominusday running of the corporation D. by voting on issues that concern them

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Business

Trinity Davenport

3 November, 19:25

How do the shareholders of most corporations exercise their control of that corporation? A. by electing members of a board of directors B. by vetting the decisions of the board of directors C. by providing oversight of the dayminustominusday running of the corporation D. by voting on issues that concern them

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Zachariah Lloyd · Answer 1

A. by electing members of a board of directors

Explanation:

A corporation is owned by it's shareholders as a group. Each shareholder holds a proportion of the share capital of a corporate and has voting rights in proportion of his shareholdings.

Shareholders are usually granted the following rights:

Ownership rights Voting rights Right to transfer shareholdings Right to view and inspect key company documents such as financial statements, memorandum of association. Right to sue the company for malafide acts Right to receive a declared dividend

Shareholders have the right to propose a course of action to the management and approve contracts the company enters or plans to enter with outside parties.

The greatest control exercised by shreholders is related with their voting power which provides them the right to elect a director, remove an elected director or change the composition of a corporate's board of difrectors.