Week 3 - Duties of Corporate People Paper
Week 3 - Duties of Corporate People Paper PRG211
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Date Created: 11/09/15
Running head DUTIES OF CORPORATE PEOPLE Duties of Corporate People Mr Scott Byron Freeman BUS670 Legal Environment Professor Peter McCann December 26 2015 DUTIES OF CORPORATE PEOPLE 2 Duties of Corporate People The purpose of this paper is to detail the respective duties of those necessary to the corporate process This paper will also analyze the differences of the publicly held and closed corporation This paper will enable the laymen to understand corporate structure those necessary and the defend types of corporation in order to have a foundation grasp of this form of business Corporate Directors The original objective of the corporation has been to enhance corporate profits and shareholder gain Mallor Barnes Bowers amp Langvardt 2010 p1047 In order to secure this many people are needed to handle specific duties which will allow the company to run smoothly and be fiscally sound One of the main groups is the Board of Directors BD The BD holds the authority and the responsibility of managing the corporation Mallor Barnes Bowers amp Langvardt 2010 p1049 The model business corporation MBCA act allows for the corporation to be managed under the direction of the board of directors Thus a large company can be run by the chairman of the board a committee or a chief executive officer Mallor Barnes Bowers amp Langvardt 2010 p1049 In many large corporations you will find that a person holds the title of Chairman of the Board as well as Chief Executive Officer It is often found in companies that operate in different companies or have several companies under their corporate umbrella Keep in mind that a single corporation can also have another corporation under their corporate charter Although the BD may act as one group in order to manage the company the individual members of the board can and often due act as heads of departments in DUTIES OF CORPORATE PEOPLE 3 the corporation Within the BD duties are the directives that they must supervise the committees the chairman and the officers to ensure the policies are being carried out and the company is being managed prudently Mallor Barnes Bowers amp Langvardt 2010 p1049 this means that the BD is actually a watch dog not only of the company but of the way that the Chairman who calls the shots for the company They are beholden to the shareholder and held accountable for the duties they are charged Because they are responsible to the shareholder many companies allow for the voting by the shareholders for the positions on the BD Corporate Of cers The officers of a corporation usually include a president vice president secretary and treasury Mallor Barnes Bowers amp Langvardt 2010 p1054 These offices can be held by more than one person or rather one person can hold more than cone position The president is appointed by the BD and is responsible for running the day to day actions of the company Picture the President as the hands on manager of a company The duties may also include signing contracts making contracts and conducting meeting that promotes the fiscal soundness of the company The Vice President can range from a corporate over watch position to actual heads of departments within the corporation They are usually responsible for the productivity of certain departments The Secretary is responsible for the certification of corporate document and has the duty of taking the minutes which are essential for corporate record keeping The Treasurer is responsible for exactly what the title states the treasure or monies of the company The treasurer is the legal custodian of the companies funds He or she is responsible for the receiving or disbursement of funds in the name of the company Shareholders DUTIES OF CORPORATE PEOPLE 4 Shareholders are a very significant part of a corporation and they often do not understand the power that they have With a vote from shareholders they can approve or deny compensation packages offered to new BD or CO s They can also affect the value of a company Shareholders have an ownership stake in a company but they do not have a true say in the management of the company outside the shareholders meeting The role of the shareholder is limited to electing and removing directors approving certain matters and ensuring actions of the managers are consistent with laws Mallor Barnes Bowers amp Langvardt 2010 p1083 Public vs Closed Corporation Corporations whose shares are generally available to public investors are considered publically held corporations Mallor Barnes Bowers amp Langvardt 2010 p1010 This in itself is a clear cut definition of a public corporation These companies are seen on the New York Stock Exchange and other exchanges People are allowed to freely buy shares and sell them in an effort to make money by dividends given by the corporation at the end of the fiscal year Corporations with very few shareholders whose shares are not available to the general public are called close corporations Mallor Barnes Bowers amp Langvardt 2010 p1010 Many companies are privately held until they decided to have an Initial Public Offering When this is done the company goes public and people are allowed to buy shares A company can offer shares without going public but after a certain amount of shareholder and shares a given the company must go public A public company can still control the amount of shares that are released to the public Summary DUTIES OF CORPORATE PEOPLE 5 There are many types of corporations from Public to private and from profit to nonprofit Each company has a governing group of people known as a board of directors and they have corporate officers that more directly run the company at the bequest of the board of director Each person is responsible for something that has to do with the profitability of the company These duties are sometimes vast and sometimes limited in their actual focus but they all affect the bottom line of the company Shareholder can be a gauge to a company that they are valued undervalued or hold no value at all They are in the shareholder position to make money They can exercise limited power in company meetings and they hold a lot of collective power They just have no say in the day to day running of the company Corporations can be large or small and they are used to offer some degree of protection from liability of the owners in business DUTIES OF CORPORATE PEOPLE References Mallor J P Barnes A J Bowers T amp Langvardt A W 2010 Business law The ethical global and ecommerce environment 14th ed New York IrwinMcgraw Hill
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