Question

Discuss the role and powers of shareholders and the board of directors in a corporation.

Answer 1

Ans:

Role and Powers of Shareholders in a corporation :

1.Shareholders are the owners of the corporation. They have ownership rights in the shares of corporate stock.

2. The role of the shareholder in the corporation is limited, however, as they have neither the right nor the obligation to manage the day-to-day business of the enterprises.

3. Shareholders have the right to access and examine corporate records and information concerning the governance and financial performance of the entity.

4. The ultimate control as to the composition of the board of directors rests with the shareholders ,who can always appoint,and more importantly .sometimes dismiss a director.

Role and Powers of Boards of Directors in a corporation :

1. The Board are directly accountable to the shareholders and each year the company will hold an annual general meeting (AGM) at which the directors must provide a report to shareholders on the performance of the company.

2. Establish vision, mission and values - and Set strategy and structure

3.Directors look after the affairs of the company ,and are in a position of trust. and Directors are responsible for ensuring that proper books of account are kept.

4. Link between the company and External environment.