What are the duties of corporate shareholders?

Corporate shareholders are individuals or organizations who own shares in a corporation. Each shareholder holds part of the ownership of the company and provides it with capital needed for operating expenses and expansions. Shareholders are entitled to certain rights and responsibilities that are determined by the company’s governing documents, like its Articles of Incorporation and Bylaws. These rights and duties can vary depending upon the type of ownership and corporate structure. As a general rule, the corporate shareholder duties in Maryland include (but are not limited to): 1. Electing the company’s directors. Directors are the individuals responsible for making major business decisions on behalf of the corporation. Shareholders elect the company’s directors at an annual or special meeting. 2. Receiving dividends from the company’s earnings. Dividends are a form of return on investment that are distributed to shareholders periodically. 3. Vetoing certain company decisions. Shareholders may be granted the right to vote on major company decisions, such as mergers or other restructuring. 4. Receiving notice of shareholder meetings. It is the responsibility of the corporation to notify shareholders of any meetings, including the date, time and location. 5. Participating in shareholder meetings. Shareholders must attend or send a representative to exercise voting rights or to discuss company matters with other shareholders. 6. Having access to corporate records. Shareholders should have the right to inspect the company’s documents, including financial records. Finally, it is important to note that shareholders’ rights and duties are determined by the company’s governing documents. Depending on the type of corporate structure, certain rights and duties may apply differently than others.

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