Shareholder

Financial Dictionary -> Investing -> Shareholder

A shareholder is anyone who holds shares in a company. Usually they have been issued a stock certificate. Shares of stock are sold by a company to start up or expand a corporation. A shareholder and a stockholder are the same. Holding stock in a company means that you own a part of that company. When someone holds stock in a company, they get certain privileges that aren't available to those who do not hold stock. A shareholder has the right to vote on certain company issues, usually including control of the business, for example, the company's directors.

Usually there is a shareholder voting agreement, a legal contract, which specifically details how board members can be elected, mergers and acquisitions, and other company-related business. Shareholders have the right to participate in annual meetings. However, most times, shareholders are unable to attend these meetings. When this is the case, the shareholder may vote by proxy. According to the SEC (Securities and Exchange Commission), all mutual funds are required to make their votes available to the public.

Sometimes a shareholder holds shares, or stocks, of the company he works for. However, it is not required for you to work for the company for whom you hold shares. You may purchase stock from any public company. If you do work for a company that issues shares, check to see if you have an employee stock purchase plan. Sometimes you can buy your company's stock at a discounted rate.

Each publicly traded company has a stock symbol. You should be able to find in on your company's webpage. If not, you can 'google' it.

Being a shareholder in a corporation gives you a say-so in how it's run and who runs it. It may also allow you to receive company news and information that the public isn't necessarily privy to until later.