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{{a|devil|[[File:Veil.jpg|450px|thumb|center|Beneath the veil, yesterday]]}}In a formal legal context, the [[ontology|ontological]] fiction by which a [[corporate personality]] is distinct from | {{a|devil|[[File:Veil.jpg|450px|thumb|center|Beneath the veil, yesterday]]}}In a formal legal context, the [[ontology|ontological]] fiction by which a [[corporate personality]] is distinct from those ''owning'' it — [[shareholder]]s — and those ''running'' it — [[employee]]s. | ||
This is all great japes if your taste runs to jurisprudential conundrums. | |||
===[[Shareholder]]s=== | |||
In law a [[corporation]] is, literally, a different [[Corporate personality|person]] from its [[shareholder]]s. Even if it only has ''one''. | |||
It is not true that the company’s [[shareholder]]s “beneficially” own the company’s assets: that is to confuse the [[Companies Act 2006 (UK)|statutory regime governing corporations]] and the [[Law of equity|equitable]] one governing ''[[trust]]s''. A [[shareholder]] — even ''sole'' [[shareholder]] — owns, legally and [[Beneficial ownership|beneficial]]ly, the shares in the company. The company, legally and beneficially, owns its ''own'' assets. A 100% shareholding is not the same, even economically, as [[beneficial ownership|“beneficial” ownership]] of those assets, since the company’s creditors get first claim to their value should the company be unable to pay its debts. | |||
===The [[employees]] and the [[agency problem]]=== | |||
In the dimly-lit salons of [[financial services]], it often presents in a different way: between ''what your employees know'' and ''what your systems know''; and in the misshapen grotesque of the [[agency problem]]. Both ultimately come down to the same point: when you judge the relative effect of the personalities that buffet the modern corporation; that propel it and give it an apparent direction — its own, its shareholders, and those of its directors, officers, employees and agents — the personality most weakly in command of the bus is that of ''the legal entity itself''. Every other personality, notwithstanding how crippled it may be by human motivations, proclivities, foibles and flaws, is at least ''animate''. A [[corporation]], ''in and of itself'', is a dematerialised stack of papers in a corporate registry somewhere. It is ''inert''. | |||
===[[Meatware]] versus bookware=== | ===[[Meatware]] versus bookware=== | ||
Here, the [[legal entity]], sitting primly behind its veil, is [[Short an option|short a rather ugly option]]; one which tries the patience of [[legal eagles]] — who will have to row it back when, as inevitably it will, everything goes Pete Tong — and of [[salespeople]] and other [[risk controller]]s, who will find the [[legal department]]’s craven ''softness'' when challenged utterly confounding. | Here, the [[legal entity]], sitting primly behind its [[Corporate veil|veil]], is [[Short an option|short a rather ugly option]]; one which tries the patience of [[legal eagles]] — who will have to row it back when, as inevitably it will, everything goes Pete Tong — and of [[salespeople]] and other [[risk controller]]s, who will find the [[legal department]]’s craven ''softness'' when challenged utterly confounding. | ||
''Why is it that legal contracts never do what they’re meant to when you need them?'' | ''Why is it that legal contracts never do what they’re meant to when you need them?'' | ||