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The concept of the Corporation - 12:39 purposes., .

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12:39 The concept of the Corporation   A corporation is a body created by law to represent individuals for business and other  purposes. It has its own legal status, and continues to exist regardless of changes to the  individuals it represents. It is able to use its corporate name to enter into contracts, to own  property and to be a party to legal proceedings. Obviously, a corporation must operate  through natural persons, as it is an artificially created legal person.  “The concept of the corporation is not new. Medieval English law recognized the corporate  structure in the first half of the fourteenth century, when the crown created corporations of  religious bodies such as monasteries and public bodies such as municipal councils. However,  the company as a form of business organization providing protection for shareholders is of  more recent origin Introduction  Shareholders     A company may have multiple stakeholders  ‘workers, managers, creditors, suppliers,  customers and other members of the community’. The largest homogenous group of  stakeholders, or as they are sometimes known, ‘non-shareholder constituents’ for a company  will usually be the employees. Stakeholders have an interest in the company but do not won it  (unless they are shareholders). Often the aims and objectives of the stakeholders are not the  same as shareholders and they come into conflict. Shareholder interests are typically equated with share price. This assumption may not always  hold though. For example, if a firm is a takeover target and its share price spikes in the short  run, that might appear to be in shareholders' interests. However, if that same takeover  strategy results in the killing of an industry category, then it might not be good for  shareholders with diversified portfolios. The many diversified shareholders, including large  institutional investors, do not maximize their return based on the performance of a single firm;  firm externalities may diminish overall portfolio performance. Even when these dynamics are  understood, incentives for managers to maximize industry performance have not been  employed.   (Scully, Maureen, 2005) Non-shareholders     Stakeholders or non shareholders are persons or groups that have, or claim, ownership, rights, or  interests in a corporation and its activities, past, present, or future. Such claimed rights or interests are  the result of transactions with, or actions taken by, the corporation, and may be legal or moral,  individual or collective. Stakeholders with similar interests, claims, or rights can be classified as 
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