The answer is Gollum. He's the only character who undergoes character development. It's a tragedy, where early he is confronted with choice and he is blind to the mistake he makes due to his personal weakness, and suffers the consequences and realizes, but too late, the error of his ways. Compare him (favorably) to King Lear, or Hamlet, or Oedipus, etc.

The other characters are essentially finger puppets, they have "a nature", a personality, but they don't change, it's just "and then this happens (but I don't actually change) and then this happens (and I don't actually change) and this happened (don't worry, I'm still the same old me you are comfortable with)". These are sidekicks, these are comic book characters.

The richer human qualities of character development are what we can identify with as we look back at our lives and recognize our own growth, our own change, and the importance of setting aside our weaknesses in favor of larger themes of living up to our better selves.

What makes Lord of the Rings weak as literature is that it wasn't written centered around its most interesting character, Gollum.