The chief financial officer must share their work with the board of directors so the board members understand how financially fit the company is. They may review accounting reports, develop budgets and work on identifying cost inefficiencies. The CFO oversees the financial health of the organization. Treasurer or chief financial officer (CFO) The individual in this role reports to the CEO, but may have members of middle management report to them. The COO handles more of the day-to-day operations of the company, including marketing and human resources. Vice president or chief operations officer (COO) Other members of management report to the CEO. The individual in this position is responsible for overseeing the entire operations of the business and they report to the board of directors. These positions may include: President or chief executive officer (CEO) The main purpose of corporate officers is to handle the day-to-day operations of the company. Corporate officersĬorporate officers, or individuals in upper management roles, are ones that the board of directors fulfills. How many board members an organization has depends on its needs. Inside directors work at the company and are involved in the day-to-day operations while outside directors are usually responsible for more impartial decisions. ![]() Positions within the board of directors may include a chairperson, vice president, secretary, treasurer and other directors, including both inside and outside directors. The board of directors is responsible for writing the organization's bylaws, scheduling annual meetings to discuss the direction of the business, approving projects and budget increases, making sure the CEO is performing their job as expected and creating committees that will further the purpose of the company. Shareholders elect the individuals who make up the board of directors. There are usually three parts to a corporate structure, including: Board of directors Related: 20 Essential Business Roles Within an Organization How is a corporation structured? ![]() Corporations that are decentralized are usually also horizontal, providing autonomy to many roles within the organization. Those that are centralized are usually also vertical to support the role of a CEO who makes larger company decisions. While a horizontal chain of command may have fewer middle managers, vertical corporate structures often have several levels in the organization from entry-level employees to CEOs.Ĭorporate structures can also either be centralized or decentralized. It's common for corporate structures to include well-known departments like information technology, marketing, human resources and accounting, with each of these operating with shared goals and values.Ī corporate structure may be horizontal or vertical, depending on how the company builds its chain of command. Corporations can choose how they structure themselves, and it's frequently based on the industry the business is in. ![]() What is a corporate structure?Ī corporate structure is how a business organizes its departments and other units depending on its overarching goals and objectives. ![]() In this article, we define corporate structure, explain how a corporation is structured and why corporate structures are important, provide a list of typical corporate structures and answer some frequently asked questions about corporate structures. Corporate structure is beneficial because it can better employee relations, develop open lines of communication and improve collaboration and productivity. Forming an official company structure can maintain order and balance, helping employees understand where they place on the corporate ladder. When formed, a company may take on a variety of corporate structures, depending on the industry its in and the responsibilities it wants to assign to specific roles.
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