What are shareholder rights and how do they work?

What are shareholder rights and how do they work?

Shareholder rights are the entitlements and privileges that shareholders have in a corporation, including voting rights, the right to receive dividends, and the right to access certain information about the company.

Can you explain the voting rights of shareholders?

Certainly! Shareholders typically have the right to vote on important matters such as electing the board of directors, approving mergers, and other significant corporate actions. The number of votes a shareholder has is usually proportional to the number of shares they own.

What happens if a company violates shareholder rights?

If a company violates shareholder rights, shareholders may take legal action, which can include filing a lawsuit or seeking remedies through regulatory bodies. They may also push for changes in corporate governance.

Are there different types of shareholders?

Yes, there are two main types of shareholders: common shareholders, who have voting rights and may receive dividends, and preferred shareholders, who typically do not have voting rights but have a higher claim on assets and earnings.