A shareholder is an individual or legal entity that owns one or more shares in a company. This ownership stake represents a claim on part of the company’s assets and earnings. Shareholders can be private individuals, other companies, institutional investors or government entities, and their level of influence typically depends on the number and type of shares they hold. Those with voting shares have the right to participate in decisions such as electing directors or approving major corporate actions.

Identifying a company’s shareholders is a key step of Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures for understanding the ownership structure and determining who ultimately controls or benefits from the business. This is especially important for uncovering the identities of beneficial owners: those who may not be listed in official company records but still hold significant influence or economic interest through shareholding arrangements.

Shareholder transparency is vital for assessing financial crime risks such as money laundering, corruption or sanctions evasion. Financial institutions and regulated entities must collect and verify shareholder information as part of Customer Due Diligence (CDD), especially when shareholders hold a significant percentage of ownership or voting rights.