Who are the primary risk bearers of the company?

Correct option is A

The primary risk bearers of a company are the Equity Shareholders. Equity shareholders are the true owners of the company, and they receive returns only after all other claims—such as creditors, debentureholders, and preference shareholders—have been paid. This makes them the residual claimants of the company.
If the company incurs losses, equity shareholders are the first to be affected and may receive zero dividends. In the event of liquidation, they are the last to be paid, receiving whatever remains after settling debts and preferential claims. Because of this high-risk position, equity shareholders have the potential to enjoy higher returns when the company performs well.
Thus, the correct answer is (a) Equity shareholders.
Information Booster
1. Equity shareholders have voting rights and participate in major decisions of the company.
2. They receive dividends depending on the company's profitability and board decisions.
3. They are considered owners, whereas others (creditors, debentureholders) are outsiders.
4. Equity capital is a permanent source of finance for the company.
5. Their return is uncertain—reflecting both risk and reward.
Additional Information
· (b) Preference shareholders: They bear less risk because they receive fixed dividends and get priority over equity shareholders during liquidation.
· (c) Creditors: They are lenders who receive interest and principal repayment; their risk is minimal compared to equity holders.
· (d) Debentureholders: They are long-term debt providers who receive fixed interest; their claims are settled before shareholders, so they do not bear primary risk.