If company fails, business assets e.g. land, equipment, stocks, bad debts etc are liquidated and losses are paid. They may suffer job loss, but employees cannot be pursued for company debts. Thus the original owners can raise money for the company or to liquidate some of the funds they injected into the company. The shares reflect the value of the firm which may be greater than the actual sums thus invested. This value is divided up into shares typically 1 or 25p.
Large shareholdings offer more voting power.
Shares of some limited companies may be held by one person and have a total nominal share value of a few hundred pounds only. The distribution of share ownership influences how the business is controlled. A company is bound by legal conditions. Failure to comply puts the company in breach of the law. Every year the company must report the following to the Registrar of Companies.