As a Stakeholder, What Are Your Rights and Responsibilities?

The investors who invest money in any firm are called as the stakeholders or shareholders.

The main purpose of investing money in any firm is to gain income by way of getting regular dividends and by virtue of increase in growth in the investment. However, during certain situations, the investors are not able to derive the benefits as expected from the companies on account of many reasons.

As a stakeholder in a company, he should be in a position to know his rights:

· To receive the share certificates on allotment or transfer as the case may be within the scheduled time; (However, this procedure is applicable to the share certificates delivered in physical formats according to the procedure adopted years back and nowadays, the details of investments are made available to the investors through electronic mode called as dematerialization formats. Even now some investors prefer to receive share certificates in physical formats).

· To receive the copies of the abridged annual reports, the balance sheet, the profit and loss account and the auditor's report;

· To participate and vote in the various general meetings either in person or through proxies;

· To receive the dividends as and when approved in the annual general meetings;

· To get the corporate benefits namely; the rights, bonus etc. once approved;

· To make an application to the company law board towards directing the company to convene the annual general meetings as and when due;

· To conduct inspection of the books of accounts during the general meetings and to receive copies thereof;

· To proceed against the company by way of civil or criminal proceedings in case of necessity;

· To apply for the winding up of the company and

· To receive the residual proceeds, if any.

Apart from the rights as mentioned above, the investor also enjoys as an individual shareholder the following rights as a group namely;

· To call for an extra ordinary general meeting;

· To demand a poll on any resolution;

· To apply to the company law board towards investigating into the affairs of the company and approach the company law board for getting appropriate relief in the case of oppression and/or mismanagement.

In the case of debenture holders, who had invested in the debt instruments, they have the following rights namely;

· To receive the interest/redemption amount on due date;

· To receive a copy of the trust deed on request;

· To apply for winding up of the company in case the company fails to pay its debt and

· To place before the debenture trustee his grievances, if any.

The stakeholder should also keep in mind that the abovementioned rights may not necessarily be absolute. For example, the rights available to the stakeholders for transferring the securities are subject to the company's right to refuse the transfer in case of any violation of rules and regulations.

Apart from the various rights as mentioned above, the stakeholders have certain responsibilities namely;

· To remain informed; be vigilant; participate and vote in general meetings and

· To exercise the rights on their own or as a group keeping in mind their own interest and more specifically the interest on the growth of the company.

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