A company is classified as a separate legal entity, which often gives rise to a separation of powers, which in turn is a primary reason for ensuring there are effective corporate governance systems in place.

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A company is indeed a separate legal entity from its owners, which means that it has its own legal rights and obligations. This separation of powers can lead to a situation where the management of the company may not always act in the best interest of its shareholders, which is why effective corporate governance systems are necessary to ensure accountability and transparency.

A Company Is Classified as a Separate Legal Entity, Which