Shareholder Rights

As a shareholder and part owner of the business you are entitled to certain rights.

In each of the instances outlined below, you should be clear about your overall investment goals and strategy and determine whether any action is required on your part.

A shareholders rights can include:

Annual general meeting (AGM)

AGM’s are held once a year.  It is here that shareholders make decisions on:

  • electing new directors
  • director remuneration
  • other company business

You can choose to attend in person if this is practical, or your vote can be counted by returning a voting form to a proxy.

Investors consider an AGM as a good opportunity to both have their say and to hear what senior management has to say.

Reports & announcements

You can choose to receive annual reports in either a full or condensed version.

Reading about the company financials is a good way for investors to keep on top of the company performance and future growth prospects.

You should receive notification of significant announcements that could effect the company's share price.  This is normally done via an email subscription.

Dividends & dividend reinvestment plans (DRP)

Dividends are usually paid by a company twice a year and for many shareholdings come with franking credits. 

As shareholders of some companies you can choose to receive your dividends as additional shares.  This is called a dividend reinvestment plan and is sometimes offered at a discounted share price.

You (or your accountant) will have to calculate the cost base for capital gains purposes for each small parcel of shares that you receive as part of a dividend reinvestment plan.  Be aware that you will need to keep excellent records if you choose to participate in DRP's.

Corporate actions

As a shareholder you are entitled to participate in any corporate actions that may raise.  These include further issues of shares, share buybacks (explored in detail in our Mechanics of share investing section) and mergers and de-mergers.