Public company

Replica of an East Indiaman of the Dutch East India Company/United East Indies Company. The Dutch East India Company (also known by the abbreviation “VOC” in Dutch), the world's first formally listed public company,[1] started off as a spice trader. In 1602 the VOC undertook the world's first recorded IPO. "Going public" enabled the company to raise the vast sum of 6.5 million guilders quickly.

A public company, publicly traded company, publicly held company, publicly listed company, or public limited company is a company whose ownership is organized via shares of stock which are intended to be freely traded on a stock exchange or in over-the-counter markets. A public company can be listed on a stock exchange (listed company), which facilitates the trade of shares, or not (unlisted public company). In some jurisdictions, public companies over a certain size must be listed on an exchange.

Public companies are formed within the legal systems of particular states, and therefore have associations and formal designations which are distinct and separate in the polity in which they reside. In the United States, for example, a public company is usually a type of corporation (though a corporation need not be a public company), in France it is usually a "société anonyme" (SA), in Britain a public limited company (plc), and in Germany an Aktiengesellschaft (AG). While the general idea of a public company may be similar, differences are meaningful, and are at the core of international law disputes with regard to industry and trade.

History

Courtyard of the Amsterdam Stock Exchange (or Beurs van Hendrick de Keyser in Dutch), the world's first formal stock exchange.[2][3][4][5] Modern-day publicly listed multinational corporations (including Forbes Global 2000 companies), in many respect, are all 'descendants' of a business model pioneered by the Dutch East India Company (VOC) in the 17th century.[6]
One of the oldest known stock certificates, issued by the VOC chamber of Enkhuizen, dated 9 Sep 1606[7][8][9][10]

In the early modern period, the Dutch developed several financial instruments and helped lay the foundations of modern financial system.[11][12] The Dutch East India Company (VOC) became the first company in history to issue bonds and shares of stock to the general public. In other words, the VOC was officially the first publicly traded company,[13] because it was the first company to be ever actually listed on an official stock exchange. While the Italian city-states produced the first transferable government bonds, they did not develop the other ingredient necessary to produce a fully fledged capital market: corporate shareholders. As Edward Stringham (2015) notes, "companies with transferable shares date back to classical Rome, but these were usually not enduring endeavors and no considerable secondary market existed (Neal, 1997, p. 61)."[14]

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