Business – 1.2 Business structure – Business ownership | e-Consult
1.2 Business structure – Business ownership (1 questions)
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Financial Resources
- Ability to raise large amounts of capital by issuing shares to the public, facilitating major expansion projects.
- Improved credibility with banks and investors, often leading to better borrowing terms.
- Increased regulatory compliance costs and disclosure requirements, which can offset some financial benefits.
Control
- Ownership becomes dispersed among many shareholders, reducing the original owners’ direct control.
- Decision‑making is subject to board approval and shareholder voting, potentially slowing strategic actions.
- Management may be pressured to focus on short‑term shareholder returns rather than long‑term business goals.