Equity shares are the main source of finance for a company. They are issued to the public and shareholders do not have preferential rights to repayment or dividends. Shareholders own the company collectively and enjoy residual income but also control over company affairs. Equity shares are a permanent capital source, shareholders bear the highest risk as owners, and shares can be transferred. Dividends are paid from company profits but there is no obligation to pay. Equity provides permanent capital with no repayment liability and increases creditworthiness, but it has the highest cost and dividends are not tax deductible with high floatation expenses.