Minimum Profit And Profitability
r has many rights, though in public companies these are more apparent than real.
For the record, the shareholder has the right to: (https://www.shareholderrights.co.uk/)
i be paid a dividend if profits allow. In practice the directors announce the dividend and the shareholders meekly accept ii receive a copy of the annual accounts and reports. Companies are required by Stock Exchange rules to send out a half-year summary also. Often companies prepare quarterly accounts which are available to shareholders on request;
iii appoint the directors;
iv appoint the auditors. The auditors are answerable only to the shareholders, though in practice all the shareholders get (for what is often a six-figure sum) is a maximum of 100 words, and even they are copied out of an Institute of Chartered Accountants leaflet. The only people who get any real information are the directors, who are the very people the auditors are supposed to be checking on!
v attend general meetings. The company must have an annual general meeting every calendar year within 15 months of the previous meeting. Further meetings are called extraordinary general meetings;
vi vote on all resolutions (assuming the shares carry a vote). Some resolutions require more than a 50% vote. A shareholder who cannot attend a meeting may vote by proxy;
vii question the directors at a general meeting. In practice little time is provided for this and a shareholder can easily be denied this right;
viii inspect the register of members without charge;
ix be provided with a copy of the memorandum and articles of association of the company (on payment of a modest fee).
There are additional'remedies for shareholders to protect them from abuse by directors and majority shareholders. There are also rights in connection with liquidations and in convening extraordinary gener
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