Proprietary Ratio is :

Shareholder's Funds/Total Assets

The proprietary ratio, also known as the equity ratio, measures the extent to which a company's shareholders' funds (equity) finance its net assets (capital employed). It is calculated as follows:
Proprietary Ratio = Shareholders' Funds / Capital Employed (or Net Assets)
A higher proprietary ratio indicates a larger proportion of assets financed by shareholders' funds, which is viewed positively by creditors as it provides them with greater security. In other words, a higher equity ratio signifies that the company relies more on its owners' investment rather than external debt to finance its operations.
Alternatively, the proprietary ratio can also be computed in relation to total assets instead of net assets (capital employed). In this case, the formula would be: Proprietary Ratio = Shareholders' Funds / Total Assets

The sum of the debt to capital employed ratio and the proprietary ratio is always equal to 1, representing the total financing of assets by a company's capital structure. This means that the proprietary ratio complements the debt to capital employed ratio in giving a comprehensive picture of how a company's assets are financed.