What does it mean to be a shareholder in a company?

When you invest in public companies, you purchase shares of the company's stock. Each share of stock you own reflects a small portion of ownership of the company, making you a shareholder. What is a shareholder? A shareholder can be an individual or entity — such as a company or organization — that owns stocks in a particular company.

What are the rights and responsibilities of a shareholder?

Being a shareholder (or a stockholder, as they’re also often called) comes with certain rights and responsibilities. Along with sharing in the overall financial success, a shareholder is also allowed to vote on certain issues that affect the company or fund in which they hold shares.

Who is a majority shareholder in a company?

A single shareholder who owns and controls more than 50% of a company’s outstanding shares is called a majority shareholder. In comparison, those who hold less than 50% of a company’s stock are classified as minority shareholders. Most majority shareholders are company founders.

What is the difference between a shareholder and a stakeholder?

However, the two terms don’t mean the same thing. A shareholder is an owner of a company as determined by the number of shares they own. A stakeholder does not own part of the company but does have some interest in the performance of a company just like the shareholders. However, their interest may or may not involve money.