Working Control

AAA

DEFINITION of 'Working Control'

When a minority shareholder (or shareholders) has enough voting power to influence or determine corporate policy. Working control exists particularly in corporations with widely dispersed share ownership where no shareholder has a majority interest.

INVESTOPEDIA EXPLAINS 'Working Control'

Working control exists when a minority shareholder or multiple minority shareholders unite to possess a controlling vote in a corporation. The opportunity for minority shareholders to gain this control is seen especially in corporations where there is no dominant majority (greater than 50%) shareholder. While there are no official benchmarks for defining working control, 20% ownership is often considered large enough to exhibit this level of influence.

RELATED TERMS
  1. Shareholder

    Any person, company or other institution that owns at least one ...
  2. Controlling Interest

    When one shareholder or a group acting in kind holds a high enough ...
  3. Minority Interest

    1. A significant but non-controlling ownership of less than 5 ...
  4. Board Of Directors - B Of D

    A group of individuals that are elected as, or elected to act ...
  5. Majority Shareholder

    A person or entity that owns more than 50% of a company's outstanding ...
  6. Poison Put

    A takeover defense strategy in which the target company issues ...
RELATED FAQS
  1. How do proxy fights work?

    A proxy fight occurs when a group of shareholders in a particular company attempts to join together to effect change in ... Read Full Answer >>
  2. How do modern companies assess business risk?

    Before a business can assess or mitigate business risk, it must first identify probable or likely risks to its bottom line. ... Read Full Answer >>
  3. Why has emphasis on corporate governance grown in the 21st century?

    Corporate governance refers to operational practices, management protocols, and other governing rules or principles by which ... Read Full Answer >>
  4. What impact did the Sarbanes-Oxley Act have on corporate governance in the United ...

    After a prolonged period of corporate scandals involving large public companies from 2000 to 2002, the Sarbanes-Oxley Act ... Read Full Answer >>
  5. Why should investors research the C-suite executives of a company?

    C-suite executives are essential for creating and enacting overall firm strategy and are therefore an important aspect of ... Read Full Answer >>
  6. What is the difference between a direct and an indirect distribution channel?

    A direct distribution channel is organized and managed by the firm itself. An indirect distribution channel relies on intermediaries ... Read Full Answer >>
Related Articles
  1. Options & Futures

    Activist Investors: A Good Or Bad Thing?

    When a large stakeholder is dissatisfied with a company's management, it may take matters into its own hands.
  2. Mutual Funds & ETFs

    Could Your Company Be A Target For Activist Investors?

    Find out why certain companies are targeted by these investors.
  3. Investing Basics

    Explaining Tender Offers

    A tender offer is a broad public offer made by a person or company to purchase all or a portion of the shares of a publicly traded company.
  4. Investing Basics

    Explaining the Volcker Rule

    The Volcker Rule prevents commercial banks from engaging in high-risk, speculative trading for their own accounts.
  5. Investing Basics

    What is a Private Company?

    A private company is any corporation that does not have shares publicly traded in the equity markets.
  6. Fundamental Analysis

    Can Japan's Stewardship Code Turn Passive Funds Into Active Managers?

    Institutional investors in Japan have been criticized for being too cozy with corporates. Can a code force them to focus on the needs of beneficiaries?
  7. Investing Basics

    Explaining Non-Controlling Interest

    Technically, a non-controlling interest is any percentage of ownership that is less than 50% of a company’s voting equity.
  8. Economics

    How Do Accountants Use the Equity Method?

    The equity method is an accounting technique used by firms to assess the profits earned by their investments in other companies.
  9. Entrepreneurship

    Comparing Impact Investing & Venture Philanthropy

    Impact investing and venture philanthropy might be similar, but there are differences and one is more popular than the other right now.
  10. Investing Basics

    Explaining Privatization

    For a publicly traded company, privatization is the act of transitioning the company to ownership by private individuals.

You May Also Like

Hot Definitions
  1. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  2. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
  3. Quantitative Easing

    An unconventional monetary policy in which a central bank purchases private sector financial assets in order to lower interest ...
  4. Current Account Deficit

    A measurement of a country’s trade in which the value of goods and services it imports exceeds the value of goods and services ...
  5. International Monetary Fund - IMF

    An international organization created for the purpose of: 1. Promoting global monetary and exchange stability. 2. Facilitating ...
  6. Risk-Return Tradeoff

    The principle that potential return rises with an increase in risk. Low levels of uncertainty (low-risk) are associated with ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!