Business readiness

Group Structure Chart

What is a Group Structure Chart?

A group structure chart outlines the relationships of subsidiaries and various entities owned by your company, across various jurisdictions.

A group structure chart is a visual representation of the structure of your group companies. It provides information on the links and networks that exist between your company, subsidiaries and other group companies. It also outlines information on the reporting structures that exist.

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Why is Group Structure Charts Important for Business Today?

A group structure chart enables your company to:

  • Define organizational hierarchy within your company
  • Determine the relationships between your company and other group entities
  • Understand the implications of direct and indirect ownership across group companies
  • Assess the contribution of each entity in your company’s portfolio

Why is Group Structure Charts Important for an Event Tomorrow?

A group structure chart is important for an event tomorrow, as it helps:

  • Assess the degree of diversification of your company, in terms of geographies and industries
  • Evaluate your company’s focus areas based on its ownership pattern
  • Ascertain the line of authority and communication within your group companies
  • Assess and leverage synergies of your group companies in your business
  • Determine the most valuable entities in your group structure
  • Evaluate the degree of centralization in your company’s group structure

Pros of Addressing Group Structure Charts

  • Assistance in accurate valuation of your company
  • Added transparency on the relationships and roles and responsibilities among your group companies
  • Consistency in policies and procedures across your group companies
  • Potential to expand business offerings and geographical reach by evaluating group companies’ capabilities
  • Flexibility to move resources across companies
  • Assists employees and officers to explain the group structure to regulators, investors, and other interested third parties

Cons of Not Addressing Group Structure Charts

  • Inability to leverage synergies when the organizational hierarchy is not defined
  • Inefficient decision-making capabilities with inadequate understanding of the degree of control over your subsidiaries
  • Potential for error in valuing your company’s assets, as ownership in group companies is not defined.

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