ABSTRACT
This chapter focuses on registered companies, with the key difference between a partnership and a constituted company being that the constituted company has its own legal personality. This raises the importance of shareholders, and ensures that shareholders are genuine, for example by limiting all shareholders to the amount of investment made. As you read through, you will understand the benefi ts and limitations of incorporation, and how these support the continuation of the business. There are different types of businesses – public, private, limited and unlimited, even charitable incorporated organisations, and each is considered, with their differences explored. For example, the difference between private and public companies is that if a private company is limited by shares, then it cannot offer its shares to the public (such as through the stock exchange), shareholding usually being confi ned to a limited number of people. Only public companies can offer their shares to the public, and these companies are listed on the stock exchange. There may be occasions when the structure and ownership of the company need to be understood in greater detail, referred to as ‘lifting the veil of incorporation’. This ‘lifting’ enables a judge to examine the structure and ownership in greater detail, to determine the company and its members. This is a restricted practice, and is only undertaken as part of a legal process. Towards the end of the chapter is an overview of the Nuttall Review 2013. The Nuttall Review made a set of recommendations based around employee ownership, and how employees can play a bigger role in the company’s management. This has led to a number of government proposals on greater consultations and opportunities for employees to purchase shares as part of their employment package. As you progress through the chapter, think about companies which you know, and apply the principles you read about.
