What is a key characteristic of significant influence over an investee?

Significant influence over an investee is typically characterized by the ability to participate in determining financial and operating policies without having full control. This means an investor may hold a substantial amount of shares, often between 20% and 50%, allowing them to influence decisions such as major financial transactions or operations, but not enough to dictate them entirely.

This participation in decision-making reflects a partnership or collaborative approach, where the investor can shape the direction of the investee through their input, rather than through authoritative control. In contrast, complete control would imply a dominance that is not indicative of significant influence. Joint control refers to shared power with another party and falls under a different definition, while owning more than 50% of shares typically signifies control rather than just influence. Thus, the ability to engage in the financial and operating policy decisions aptly describes the essence of significant influence.