| Pub. Date | : Oct, 2018 |
|---|---|
| Product Name | : The IUP Journal of Corporate Governance |
| Product Type | : Article |
| Product Code | : IJCG21810 |
| Author Name | : Shital Jhunjhunwala |
| Availability | : YES |
| Subject/Domain | : Management |
| Download Format | : PDF Format |
| No. of Pages | : 10 |
Shareholders or stockholders invest in a company with expectation of returns. As the rightful owners of the company, it is in their interest to make sure that the company is being governed and managed properly. After all, if the company performs badly or goes bust, it is the shareholders who lose the most. Ownership of the company may be dispersed, spread across a large number of shareholders, with no one person owning a bulk of the shares such as in the UK or Australia or may be concentrated in the hands of a few as seen in Indian or Japanese companies. Concentrated ownership can give rise to block shareholders. Block shareholders own a very large number of shares and can influence the way company will be managed. A shareholder individually or a group of shareholders (example, promoter and his family) can become majority shareholder by owning more than 50%. As controlling shareholders, they can dictate corporate decisions and may act in a manner oppressive to the minority shareholders or small shareholders.