When you think about all the biggest companies in the world, these are not private businesses or partnerships. These companies are all joint stock companies. When doing business on a fairly large scale, a joint stock company is the most suitable form of business organization. Let's find out about a joint stock company with Giaiphapdonggoi.net!
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1. What is a joint stock company?
What is joint stock company?
A joint stock company is an enterprise owned by investors. Shareholders buy and sell shares and will own a part of the company. Ownership ratio is based on the number of shares each individual owns. Shareholders can buy, sell or transfer shares to each other without putting the continued existence of the company in jeopardy.
Joint stock companies are often established to facilitate a strong growth of a company. If there are only a few shareholders involved, the company will not be able to finance itself. But by coming together, individuals can build a thriving business, with each shareholder then expecting to profit from the company's success. Each member gives and each member receives.
Joint stock companies are built to benefit all shareholders, each investor owns a part of the company - in proportion to the amount they have invested - and takes a percentage of the company's profits .
Shareholders have a lot of voting power, electing a board of directors to manage the company on their behalf, while still having a say in every part of how the company is run.
Number of members / shareholders: Members of a joint stock company can be individuals or organizations, with a minimum of 3 members and no limit on the number of members.
Raising capital: Unlike a LTD, a JSC can raise capital by the following methods: Selling shares to existing shareholders; Private sale of shares to non-shareholders; Issue shares on the stock market.
2. Benefits of a joint stock company
Benefits of a joint stock company
Joint Stock Company allows a solid business to form and develop with many people working together. Every shareholder who invests in a joint stock company can benefit from the business. Each shareholder will own a portion of the company up to the amount they have invested in the company.
Ownership comes with additional perks. Shareholders have a say in everything that happens to a joint stock company without actually running the company. Shareholders will elect a board of directors to be able to manage the company on their behalf. Positions will typically be filled through elections that will be once a year, although the specifics may vary for each company.
Shareholders not only vote for the board of directors, but also vote to approve or disapprove annual reports, budgets, and how accounts are set up. In some cases, specific shareholders may be required to participate in a certain role if that role is not filled or becomes vacant. As it happens, individuals are usually selected by consensus between those still holding other positions and the remaining shareholders of the company.
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3. Enterprise management structure of joint stock company
Corporate management structure of joint stock company
A joint stock company is also known as an incorporated company, whereby the company structure is more complex than that of a Limited Liability Company (LLC). In a joint stock company, the structure of the company consists of the Board of Directors under the supervision of the Annual General Meeting and the Supervisory Board, the Chairman of the Board of Directors and the General Director, who have the role and responsibility of the Board of Directors. responsibilities and are described below:
General Assembly - Is the highest decision-making body of the company including all shareholders. The annual general meeting of shareholders must be held at least once a year when the company's director presents an annual report on the company's performance and strategy. Unresolved matters at the Annual General Meeting may be resolved at the Extraordinary General Meeting, which may be convened at any time.
Board of Directors - The body consists of members elected by the General Meeting, has the task of jointly supervising the activities of the company.
Audit Committee - A committee consisting of independent auditors appointed by the Congress. With the role of supervising the Board of Directors and General Director. A Supervisory Board is not required if the company has fewer than 11 shareholders, of which no shareholder holds more than 50% of the shares or if at least 20% of the Board of Directors members are independent members. Establish an independent audit committee.
Chairman of the Board of Directors - Members of the Board of Directors are elected by members to organize the work of the Management Board and convene and administer meetings at least once a quarter.
General Director - The legal representative of the company appointed by the Board of Directors, who is in charge of daily activities of the company. This can be seen as a major shareholder, director or chief executive officer, who
represent the interests of the company's shareholders. The General Director is an employee of the company and resides in Vietnam.
The structure of such a joint stock company is especially important for managing the affairs of the company's operations because the shareholders are often dispersed in different locations, some may be passive in matters or can be an integral part of management, so that management and ownership can be linked.
In a joint stock company management structure, shareholders, board members and directors are all responsible for acting in the best interests of the company and can be held liable for any negligent actions. any. Shareholders are only required to contribute an amount equal to the par value of their original shares, and board members and directors may be liable for any damages caused by negligent conduct. .
A joint stock company is a type of enterprise with a highly organized, complete capital structure, capable of mobilizing large capital sources and flexibly rotating capital among investors, suitable for business activities with the size of a joint stock company. large tissue.
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