Eli5: why the shareholders in a company are not liable to pay debts owed by the company?
In: 181
Because the lender of the money agreed to condidions before lending the money.
Nobody held a gun to the bank’s head and said “you must lend to their corporation.”
Banks have a responsibility to do their own due diligence and ensure who they are lending to will pay them back.
I run a business and give credit to other businesses. If there is a credit dispute, my lawyer will go after the company, not individual employees or owners.
If I don’t get my money, that’s my problem, I should not have given that company credit.
I am employed by a corporation and it’s my job to review/approve credit arrangements and make sure my shareholders get paid.
If I fuck up, I might lose my bonus or get fired.
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