# Voting interest

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{{Short description|Legal frameworks for stockholders' voting power}}
{{accounting}}

'''Voting interest''' (or '''voting power''') is the legal capacity of a shareholder to influence corporate governance through the exercise of voting rights. While generally based on the proportionality of capital, the specific exercise and calculation of this power are governed by national statutes.

== General Principles and Proportionality ==
Most jurisdictions operate on the default principle of "one share, one vote," though this may be altered by a company's constitutional documents.

* '''United States (Delaware):''' Under the [Delaware General Corporation Law](/source/Delaware_General_Corporation_Law), the default rule is that "each stockholder shall be entitled to 1 vote for each share of capital stock held by such stockholder."<ref name="DGCL_212">{{cite web |title=Delaware Code Title 8, § 212(a) |url=https://delcode.delaware.gov/title8/c001/sc07/index.html#212 |website=Delaware Code Online}}</ref>
* '''United Kingdom:''' The [Companies Act 2006](/source/Companies_Act_2006) provides that "on a poll every member has one vote for every share held by him."<ref name="UK_CA_284">{{cite web |title=Companies Act 2006, Section 284 |url=https://www.legislation.gov.uk/ukpga/2006/46/section/284 |website=legislation.gov.uk}}</ref>
* '''Germany:''' The [Aktiengesetz](/source/Aktiengesetz) (AktG) mandates that "the voting right shall be exercised according to the par value of the shares or, in the case of no-par value shares, according to their number."<ref name="AktG_134">{{cite web |title=Stock Corporation Act (AktG), Section 134 |url=https://www.gesetze-im-internet.de/englisch_aktg/englisch_aktg.html#p1216 |website=Federal Ministry of Justice (Germany)}}</ref>

== Calculation of Voting Power and Treasury Shares ==
A critical aspect of calculating voting interest is the treatment of shares held by the company itself, known as [treasury shares](/source/treasury_shares). These shares are excluded from the total voting power to prevent management from voting on their own behalf.

=== Statutory Exclusions ===
In all three major jurisdictions, treasury shares are legally "dormant" and cannot be exercised:
* '''Germany:''' "The company shall not have any rights from treasury shares."<ref name="AktG_71b">{{cite web |title=Stock Corporation Act (AktG), Section 71b |url=https://www.gesetze-im-internet.de/englisch_aktg/englisch_aktg.html#p0591 |website=Federal Ministry of Justice (Germany)}}</ref>
* '''United States (Delaware):''' "Shares of its own capital stock belonging to the corporation... shall neither be entitled to vote nor be counted for quorum purposes."<ref name="DGCL_160">{{cite web |title=Delaware Code Title 8, § 160(c) |url=https://delcode.delaware.gov/title8/c001/sc04/index.html#160 |website=Delaware Code Online}}</ref>
* '''United Kingdom:''' The law specifies that "a company must not exercise any right in respect of treasury shares," specifically including the right to attend or vote at meetings.<ref name="UK_CA_726">{{cite web |title=Companies Act 2006, Section 726 |url=https://www.legislation.gov.uk/ukpga/2006/46/section/726 |website=legislation.gov.uk}}</ref>

== Majority Interests and Indirect Control ==
Legal frameworks also define how "majority interest" is calculated when shares are held indirectly through subsidiaries. Under German law, shares held by a controlled enterprise or for the account of the parent are treated as equivalent to treasury shares for calculation purposes.<ref name="AktG_16">{{cite web |title=Stock Corporation Act (AktG), Section 16 |url=https://www.gesetze-im-internet.de/englisch_aktg/englisch_aktg.html#p0128 |website=Federal Ministry of Justice (Germany)}}</ref>

In the US and UK, similar "look-through" provisions exist to prevent circular ownership structures where a subsidiary votes in the election of the parent's board, thereby ensuring the integrity of the voting interest calculation.

== References ==
{{Reflist}}

{{stock market}}
Category:Corporate finance
Category:Equity securities
Category:Stock market

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Adapted from the Wikipedia article [Voting interest](https://en.wikipedia.org/wiki/Voting_interest) by Wikipedia contributors ([contributor history](https://en.wikipedia.org/wiki/Voting_interest?action=history)). Available under [Creative Commons Attribution-ShareAlike 4.0 International](https://creativecommons.org/licenses/by-sa/4.0/). Changes may have been made.