Lifting the Veil on the Obligations of Corporations in the New Era of Commercialism - Essay Example

The paper discusses the reason behind the constant application of law within the systems accepted by the organization as per guided by the local governments seeing through the operations of the said business groups. In this side of the situation, the fact that a corporation has the advantage of enjoying the limited liability guideline is one of the most important laws that had been created to at least assist in the process of incorporating legalities in the business operations of the organization within and even outside the territories of the said business group. However, to be able to understand the matter well, it is first important to know what limited liability actually stands for and how much it naturally affects the ventures of the business as an entity in the field of international commerce systems.

Several Advantages of Corporations

Most people are not willing to risk everything to go into business. Yet for a business to grow and prosper as well as create abundance for the owners of the said entities, many people would then need to be willing to invest money in it. The way to solve this particular issue among hopeful entrepreneurs was to create an artificial being, one particular entity that existed only in the eyes of the law- a business group, a corporation that is noted as an individual that has rights and personal advantages and disadvantages of existence. In this phase of the writing, the advantages of corporal creations are to be discussed.

• The advantage to have more money for investment
• Limited liability
• Advantages to business size
• Advantages to having perpetual life
• Advantages to engaging in the ease of ownership changes
• Advantages in easing the drawing of talented employees
• Advantages in creating separations of the corporation ownership from the management

As observed, one of the most important advantages that the corporation has from the other forms of business is the limited liability advantage of the organization. Likely, this advantage involves the responsibility held up towards the owners that are only in balance with the number of finances that they have invested in the business. It is considered that this particular advantage is a natural gift to the formation of the corporation. The safety of the monetary investment of the owners is well protected through the provision of the limited liability advantages of the creation of corporations. Having businesses like this is a huge advantage for many entrepreneurs at present, especially during the existing economic turmoil. Corporation owners are the ones having the best possible advantages in this scenario. Since corporations are able to extend their business sizes, their profits could naturally increase without necessarily increasing the amount of investment that they have primarily contributed to the establishment of the organization. Hence, as a result, if in any case, the business fails, the amount of financing contribution that is lost by the owner could only amount to the investment that he or she has further used as capital for the establishment of the business. To further make this discussion clearer, the following diagram shall explain more on how the unveiling of the responsibilities of the corporation actually relates to the fact that giving the organization an advantageous end in having a limited liability.

Through the application of the diagram herein, it could be noted that through the realization of the advantage that a corporation has towards its responsibilities in handling monetary issues and providing all the other stakeholders with their own due values that they ought to receive from the organization as a matter of returns on what they have put forth towards the development of the business. All in all the matter involves the whole connecting system that bounds any corporation in terms of financial standing and control. Hence through this, it could be agreed that limited liability is indeed the greatest single discovery in the field of modern business systems.