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CS Professional · CSR and Social Governance · Contribution of Non-Corporate Entities in Social Governance

Sunrise Charitable Trust, created by a registered trust deed, manages a shelter for the homeless. Trustees hold the property and run the shelter. Which feature best explains how this trust differs from a company in its governance?

A trust differs because trustees hold its property in a fiduciary capacity for beneficiaries or the stated purpose, and the trust itself is not a separate legal person. Companies have shares, shareholder meetings and separate personality, which trusts lack.

  1. AThe trust has perpetual succession and a common seal by law
  2. BProperty is held by trustees in a fiduciary capacity for beneficiaries, and the trust is not a separate legal personCorrect
  3. CMembers hold transferable shares in the trust
  4. DThe trust must hold annual general meetings of shareholders

Explanation

A trust is an obligation where trustees hold property for the benefit of beneficiaries or a purpose. It is not a separate legal person like a company, so it cannot sue or own property in its own name. Shares, AGMs of shareholders and a statutory common seal belong to the company form.

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