The corporate system has two main features:
Companies are legal persons. A corporation is a body corporate, with legal personality and the same civil capacity as a natural person. This is a fundamental feature of modern corporateism。
2. The company separates the final ownership of the shareholders from the property rights of legal persons. The property rights of modern companies are clear and the rights and responsibilities are clear, and the financiers enjoy the rights of the owners according to the amount of capital invested in the enterprise, i. E. Capital gains, significant decision-making and choice of managers. In the event of an enterprise's insolvency, the financier is liable for limited liability for the enterprise's debt only in terms of the amount of capital invested in the enterprise。
As the subject and legal entity of the market, enterprises operate and compete in the market in accordance with the law, and are subject to the control of the owner, without prejudice to the interests of the owner or “internal control”. Modern companies all have corporate governance structures that regulate the relationship of interests between financiers, operators and workers in general, and there is no direct interference by the government in the operation of business, and there is no distinction between government and business. Modern companies must continuously improve their business management and scientific management in order to survive the competition in the market。
Outreach:
The advantages of a corporate enterprise are unlimited viability, transferable equity and limited liability. It is because of these three advantages that firms are more likely to raise capital in capital markets. The limited liability of the company for debt and its unlimited existence reduce the risk to investors; the ease of the transfer of shares increases the liquidity of the investor's assets. Correspondingly, corporate enterprises have relative constraints, such as double taxation, high costs of formation and agency problems。
A corporate enterprise is an economic organization established, self-financed, self-sustaining and corporate by an investor (or shareholder) with a quorum in accordance with the law. Our corporate enterprises have both limited liability companies and limited shares. When enterprises adopt corporate forms of organization, there is a separation between the owner and the owner, who only takes part in and makes financial decisions relating to changes in ownership or capital interests, while day-to-day production and financial management activities are decided by the operator。
