Identify the false statement with regard to a company:

Every member of a company is entitled to take part in its management.

The correct answer is Option (3) : Every member of a company is entitled to take part in its management.

• A company is an artificial person. ($\text{TRUE}$). It is created by law, has a legal identity separate from its members, and can enter into contracts and own property in its own name.

• Company's shares are generally transferable. ($\text{TRUE}$). This is a key feature of a public company. Even though a private company restricts the right to transfer, transferability is the general principle of the corporate structure.

• Every member of a company is entitled to take part in its management. ($\text{FALSE}$). This is the fundamentally false statement. In a company (especially a large public company), there is a separation between ownership (members/shareholders) and management. Members only have the right to attend meetings, vote on major resolutions, and appoint/remove directors. The day-to-day management is delegated to the Board of Directors.

• The director of a company may or may not be a shareholder. ($\text{TRUE}$). A person can be appointed as a director without holding any shares (a non-member director), unless the company's Articles of Association specifically require them to hold qualification shares.

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