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The separation of ownership and managerial control allows shareholders to purchase shares, which entitles them to earn income (residual return) from the company's operations after
The separation of ownership and managerial control allows shareholders to purchase shares, which entitles them to earn income (residual return) from the company's operations after paying expenses. This, however, requires that shareholders take the risk that the company's expenses may exceed its revenues. To manage this investment risk, shareholders maintain a diversified portfolio by investing in several companies to reduce the overall risk. In your opinion, what is the reason that the owner of the company should not be in the managerial sphere anyway? Explain! Even if there are concurrently, mention examples of success and failure in their management
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