Online Investors’ Ten Most Common Questions
Do you have a say in how a company you invest it operates?
As a shareholder, you’re one of the owners of a company. And yes, that entitles you to a say in the important elements of a company’s affairs.
Generally speaking, the pecking order goes like this: The company’s board of directors hires professional managers to run the company on a day-to-day basis. These hired hands — the CEO, chief financial officer, and other key management — answer to the board of directors. The board of directors, in turn, answers to the shareholders.
Major issues, such as whether a company accepts an offer to be acquired, must be approved by shareholders. Shareholders also have the right to vote for the members of the board. All the items you can vote on are printed on a company’s proxy statement. Proxy statements will be mailed to you by your online broker or sent to you electronically.