Rights of a share holder

More shares, more power

It may seem an obvious statement but the greater the shareholding of an individual, the greater are his / her rights and the greater is his / her power within the Company.

This is so not only because the larger the shareholding the more likely it is to represent a controlling interest, but also because the Companies Act affords greater rights and power to an individual as the size of his / her shareholding increases.

For example, a shareholder owning 5% of a company has the right to have an item placed on the Agenda for discussion at a General Meeting and, once the shareholder's ownership reaches 10% of the company, he / she has greater rights including the right to force a formal audit of the annual accounts.