Right to Control

As owners of the company, the equity-holders have the right to control the operations of participate in the management of, the company. Their control is, however, indirect the major policies/decisions are approved by the Board of Directors and the Board-appointed management carries out the day-to-day operations. The shareholders have the legal right/power to elect the board of directors as well as vote on every resolution placed in various meetings of the company. Though, in theory, they have indirect right to control/participate in management, in actual practice it is weak and ineffective partly because of the apathy and indifference of the majority of the shareholders who rarely bother to cast their votes and partly because scattered and by and large unorganized equity-holders are unable to exercise their collective power effectively.

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