BUS2 365 Lecture 17: BUS2-365-001 Nov 14
Document Summary
November 14, 2016 (see examples on mycourses: today we are looking at how shareholders wield control and are held accountable for their exercise of rights. Shareholder control and majority rule: the nature of shareholder control, most corporations are small to mid-size. Non-legal control is a matter of the shareholder"s personal and financial influence: market vs legal control: Accomplish this largely through transactional activity, the buying and selling of shares. Significant because empirical studies on managerial behaviour reveals that managers are very concerned about share price, and sensitive to fluctuations in share price. In both the context of private and public corporations, shareholders have significant legal power, and they wield that power through the right to vote: when shareholders make decisions, decide as a group. Shareholder control is indirect, and is highly specific. Shareholder power is not broad like directors or officers: matters that shareholders have control over are very narrow, and are specified in the corporate constitution.