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8. Company structure

Lead-in:

body – орган, установа
Executive Board – виконавча рада
stock holder – акціонер
Chief Executive Officer (CEO) – головний виконавчий керівник;
power – повноваження
research and development – наукове дослідження, розвиток (розширення роботи)
department – відділ
market research – дослідження
advertising and promotion sector – сектор реклами та рекламного заохочення до купівлі товару
public relations – публічний зв’язок
affiliates – філіали
parent company – основна компанія
chain of command – ланцюг (порядок) влади

The highest executive body in a company is the Executive Board (or the Board of Directors). It is accountable to stockholders, and the Board reports to them at the annual stockholders’ meetings. The President is the nominal head of the company, and is elected at the annual stockholders’ meeting. But the President does not supervise the day-to-day running of the company. That is the duty of the Senior Vice-President, or Chief Executive Officer (called a Managing Director in Britain). He or she has the real executive power. The other members of this board are also vice-presidents.

Every Vice-President is responsible for the operation of one or more departments. Executive departments may vary, depending on the company and its activity, but some that are found most frequently are Production, Marketing, Finance, Personnel (Human Resources), and Research and Development (R&D). The Personnel Department is usually under the supervision of the Vice-President for Finance and Administration, while the R&D Department is under the Vice-President for Production. Department heads are called directors or managers. They are supervised by vice-presidents. Departments, in their turn, may be subdivided into sections or sectors. For instance, the Marketing Department may have a Market Research Sector, a Sales Sector, and an Advertising and Promotion Sector.

There are some peculiar positions in a company’s hierarchy. One of them is a Public Relations Manager who either belongs to the Marketing Department or heads a special sector. His or her responsibilities are to create and maintain the best possible image for the company in the eyes of the public.

Many companies, especially multinational corporations, are also divided geographically. There are special departments, managers, directors, or even vice-presidents responsible for operations in certain geographical territories.

Corporations often have subsidiaries (affiliates) that are more or less autonomous. An affiliate is another company owned by a parent company. An affiliate or subsidiary appears when a parent company becomes the owner (proprietor) of more than 50 % of its capital.

Thus the structure of a company is quite complicated. This structure and hierarchy is called “the chain of command” and ensures the company’s efficient functioning.

Questions for comprehension check-up and discussion:

What is the highest executive body in a company?
Is the Board of Directors accountable to stockholders?
Who is the nominal head of the company? Is he elected?
Who supervises the day-to-day running of the company?
What are the departments of the company that are found most frequently?
What are the responsibilities of a Public Relations Manager?
What is an affiliate?
When does an affiliate appear?

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