Business Vocabulary — Corporate Structure

Learning objectives

In this article, you will

• learn how companies are organized
• practice key vocabulary on the topic of company structure
• work with a prefix and comparative forms.

Newsmart Level 3 (B1+, TOEIC 389–550, TOEFL iBT 41–52, IELTS 4.5–5)

As you may have noticed, the stars of Newsmart are very often companies and the people who run them! We’ve already looked at the business vocabulary we use to describe these types of business, and now it’s time to look at how they are organized and structured.

The bigger the company, the more complex its structure tends to be. Very large corporations tend to be multinational and often have a number of different branches and subsidiaries. Although there is great diversity in how such large companies are organized, they usually follow a general basic pattern.

The board and shareholders

Most very large corporations these days are owned by the public. This means that ownership of the company is divided into shares that people can buy and sell. Because good corporate governance is very important to shareholders, most companies have a board of directors that oversees the company and protects the shareholders’ interests. The board reports on the business’s success and progress to the shareholders via an annual and/or quarterly report.

Upper management

At the head of every large corporation you’ll find the big shots in the C-suites! This is a group of executive officers like the CEO, COO and CFO, who have responsibility for making the strategic decisions that will give value to the shareholders. Just below these top executives are the different presidents, vice-presidents and directors in charge of the company’s various divisions. A typical large corporation might have five divisions, with marketing, accounting, finance, IT and HR being the most common.

Middle management

Next in the typical hierarchy are the middle managers, who are the link between the upper management and the lower levels of an organization. These are the people involved in the day-to-day running of a company, who perform a valuable role in implementing the executive strategy. Like the executives, middle managers need to have good leadership and decision-making qualities.

Lower-level employees

You could say that these are the people who do all the actual work! They range from blue collar workers who assemble goods on a factory line, to receptionists who answer the phones, and customer service and sales reps who interact with the public. Although low-level employees are paid less, they are vital to the success of an organization. Indeed, some big corporations ask their upper-level employees to work among the ranks of low-level workers so that they understand better how the organization operates.

At Newsmart, of course, we also try to focus on the companies of the future, the startups, small businesses and fledgling firms that could one day be significant drivers of the world economy. These businesses are often privately-owned and significantly “flatter” than tech giants like Apple at first, but as they grow and eventually go public, they tend to add the same or similar organizational layers to those mentioned above.

Photo credit: Andreas Rentz for Getty

Originally published at www.getnewsmart.com.