What are the responsibilities of a company shareholder?

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Hi there

Could you please advise the responsibilities of a company shareholder? I am to be the sole shareholder of a limited company I am developing, but I do not actually know what I am supposed to do as a shareholder.

Thank you so much

Answers

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As a shareholder, you are a beneficial owner of a company. You can be a sole shareholder who owns and controls the entire business, or you can be one of many shareholders who owns and controls a percentage of the business along with other shareholders.

You rights and responsibilities are:

  • To agree to become a member of the company by purchasing one or more shares upon becoming a shareholder.
  • To pay for your shares when they are issued to you, or at a later date upon the request of the company when it requires the money to pay its creditors.
  • To appoint one or more directors to manage the company on your behalf - shareholders may be appointed as directors of their own company.
  • To decide which powers to grant to directors.
  • To cast a vote at general meetings upon matters which the directors are not permitted to act.
  • To receive a share of any company profits as dividends - profit distribution is based upon the percentage of the company represented by your shares.
  • To receive a share of any remaining capital upon the winding up of the company - again, capital distribution is based upon the percentage of the company represented by your shares.

Company directors are responsible for all day-to-day duties involved in running the business. If you are also a director, you will be responsible for owning and managing the company simultaneously and adhering to all associated responsibilities of both roles.

a year ago
 

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