Owning a share of a company’s stock makes a person a shareholder. Shareholders are the residual owners of the corporation; they elect the board of directors and share in profits through dividends or capital appreciation. Their liability is limited to the amount they have invested.

Shareholders range from individual retail investors to large institutional holders such as pension funds and mutual funds. Voting rights, usually one vote per share, allow them to influence major decisions and board composition. In practice, dispersed ownership can leave day-to-day control with management, while concentrated ownership can give particular shareholders significant influence.

The relationship between shareholders and the company is governed by corporate law and by the company’s charter and bylaws. Activist shareholders sometimes press for changes in strategy or governance. The concept of shareholder value has been a dominant objective in many corporations, though debates continue about the proper balance with the interests of other stakeholders.