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What is a Corporation?

What is a Corporation?


A corporation (also called "company") is a legitimate entity that has its own lawful identity which is separate from its proprietors (called shareholders) and the people who oversee and maintain its day to day business (called directors and officers). The formation of a partnership happens following the proper filing of Articles of Incorporation (likewise called a Charter or Certificate of Incorporation) with the proper government office or authority.  


Each company is made up of shareholders, directors and officers. Shareholders, as the name suggests, are the ones who own the shares in the company. By reason of the votes that are typically appended to the shares, the shareholders control the corporation. In the event that there is one single shareholder, that individual has supreme control of the company. If the company has various shareholders, control of the partnership relies upon who has a larger part of the voting shares.  The shareholders don't directly manage and operate the company. They exert their impact by choosing and appointing executives and affirming or objecting major corporate decisions.  


One of the obligations of the shareholders is to choose the directors & executives of the organization, for the most part on a yearly basis. Directors & executives need not require to be shareholders of the company. The directors & executives are charged with the regulating and controlling of the corporation's undertakings, and naming the officers, who are thus in charge of the everyday running of the company.