Ratio financial commitment, or shareholder equity, is an important measurement used to assess the financial strength of a company. It is calculated by dividing the total shareholder equity by the total assets of the company. This ratio shows the percentage of investment made by shareholders in the company. It is a good indication of the confidence that shareholders have in the future performance of the business. It also serves as a gauge of the company’s ability to cover unexpected losses, fund acquisitions and pay dividends to investors.