Question

What is corporate personality?

• A. Corporate personality means that the members in general meeting are regarded by the law as a person.
• B. Corporate personality means that the board of directors is regarded by the law as a person.
• C. Corporate personality means that the company as an entity is regarded by the law as a person.
• D. Corporate personality means that all of the companies within a corporate group are regarded by the law as one person.

Answer 1

Answer: (C)

Corporate personality means that the company as an entity is regarded by the law as a person.

Corporate personality is the fact stated by the law that a company is recognized as a legal entity distinct from its members. A company with such personality is an independent legal existence separate from its shareholders, directors, officers and creators. This is famously known as the veil of incorporation.

As a result of corporate personality, a company has perpetual succession. It simply means the company is everlasting and will continue to do business until it is properly wound up. As a separate legal person, a company will not be affected by changes such as death, transfer of shares or resignation of any members but will continue to exist despite the number of times the changes of membership occur. Even if all the members die, it will not influence the privileges, immunities, estates and possessions of a company.