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Corporation

Corporations

A corporation is a legal entity separate from the persons that form it. Corporations exist as a product of corporate law, and their rules balance the interests of the shareholders that invest their capital and the employees who contribute their labor. People work together in corporations to produce value and generate income. In modern times, corporations have become an increasingly dominant part of economic life. People rely on corporations for employment, for their goods and services, for the value of the pensions, for economic growth and social development. The defining feature of a corporation is its legal independence from the people who create it. If a corporation fails, shareholders only stand to lose their investment, and employees will lose their jobs, but neither will be liable for debts that remain owing to the corporation's creditors. This rule is called limited liability, and it is why corporations end with "Ltd." (or some variant like "Inc."
and "pic"). The existence of a corporation requires a special legal framework and body of law that specifically grants the corporation legal personality, and typically views a corporation as a fictional person, a legal person, or a moral person (as opposed to a natural person). As such, corporate statutes typically give corporations the ability to own property, sign binding contracts, pay taxes in a capacity that is separate from that of its shareholders (who are sometimes referred to as "members". Persons and other legal entities composed of persons can have the right to vote or share in the profit of corporations. In the case of for-profit corporations, these voters hold shares of stock and are thus called shareholders or stockholders. When no stockholders exist, a corporation may exist as non-stock corporations, and instead of having stockholders, the corporation has members who have the right to vote on its operations. If the non-stock corporation
is not operated for profit, it is called a...