Shareholders are special because they provide capital

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Reference no: EM13892016

1. Shareholders are special because they provide capital. But, debt holders, including banks and bondholders, clearly also provide capital. Moreover, employees provide human capital, while suppliers and vendors provide raw inputs, often with generous credit terms. Even customers, of course, are providing capital through their purchases.

2. Shareholders are special because they are the owners. But, what do they own, really? The only “ownership” rights that shareholders have is the right to sell their shares, and the right to vote on the board of directors and certain other corporate actions (such as mergers).

Reference no: EM13892016

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