{"id":356902,"date":"2025-07-29T09:40:25","date_gmt":"2025-07-29T14:40:25","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/?page_id=356902"},"modified":"2025-07-29T14:23:00","modified_gmt":"2025-07-29T19:23:00","slug":"who-really-owns-a-corporation","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/smallbusiness\/who-really-owns-a-corporation.html","title":{"rendered":"Who Really Owns a Corporation?"},"content":{"rendered":"\n
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Who Really Owns a Corporation?<\/h1>\n\n
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\n By Catherine Hodder, Esq.<\/a> | Legally reviewed by Jordan Walker, J.D.<\/a>\n | Last updated\n
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Editorial Note: We earn a commission from affiliate partner links on FindLaw. Commissions do not affect the editorial integrity of our legal content.<\/p>\n\n <\/div>\n \n

\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

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Key Takeaways<\/h2>\n

Corporations are owned by shareholders who buy stock in a corporation. The stakeholders\u2019 control is determined by the percentage of shares they own.<\/p>\n\n <\/div>\n <\/div>\n<\/div>\n\n\n

A corporation is a separate legal entity controlled by people or entities with share ownership. This article explains corporations, corporate ownership, shareholder rights, how a corporation is structured, and the steps to form a corporation.<\/p>\n

What Is a Corporation?<\/strong><\/h2>\n

A corporation<\/a> is a business structure that operates as its own legal entity. That means the corporation can enter into and be bound by contracts, initiate lawsuits, and be sued. The benefit of this type of business organization is that a corporation offers limited liability protection to the owners of a corporation.<\/p>\n

For example, Dan operates a mobile car detailing service. As a sole proprietorship<\/a>, he is personally responsible for the debts and lawsuits of his business. If a client were to sue him for damage to a vehicle, a lawsuit might attach to his personal assets. However, if he forms a corporation, \u201cDan\u2019s Detailing, Inc.,\u201d any debts or lawsuits are the corporation\u2019s responsibility and do not affect his own assets that are separate from the business.<\/p>\n

Who Owns a Corporation?<\/strong><\/h2>\n

A corporation is owned by its shareholders. Shareholders buy stock in the company, and their control and interest are determined by the percentage of shares they own. Let\u2019s look at a few examples:<\/p>\n

One Shareholder<\/strong><\/h3>\n

Dan creates a corporation, \u201cDan\u2019s Detailing, Inc.,\u201d with 100 shares of stock. If he buys all the shares, he is the sole owner. Dan has 100% of control over the corporation.<\/p>\n

Multiple Shareholders<\/strong><\/h3>\n

Dan invites his brother, David, to invest in the company. If David buys 40 shares of stock, he is a 40% shareholder and Dan still retains control as he is the majority shareholder. However, if David buys 50 shares of stock, Dan and David are co-owners at 50% each and must agree on company decisions.<\/p>\n

A small business might issue shares to stockholders to help fund its startup operations. They define the number of shares and par value in the articles of incorporation filed with the Secretary of State.<\/p>\n

Shareholders of Public Corporations<\/strong><\/h3>\n

Public corporations, such as Coca-Cola or Apple sell shares to thousands or millions of people. A public corporation must be registered with the Securities and Exchange Commission (SEC)<\/a> to sell stock to the public. Many public corporations are listed on the Nasdaq or NYSE, where investors buy stock at a share price. The shareholder value can fluctuate with the ups and downs of the stock market. The main difference between a public company and private corporation is that a private corporation can limit who it issues shares to. A public company can sell stock to anyone to raise significant capital for its business.<\/p>\n

A small business owner may wish to remain a private company, allowing only minority shareholders, so that they can retain control over the business\u2019s decision-making.<\/p>\n

Shareholder Rights<\/strong><\/h2>\n

As part-owners of a corporation, shareholders may have certain rights<\/a> such as the right to:<\/p>\n