A division, sometimes called a business sector or business unit (segment), is one of the parts into which a
business,
organization or
company is divided.
Overview
Divisions are distinct parts of a business. If these divisions are all part of the same company, then that company is legally responsible for all of the obligations and debts of the divisions.
In the banking industry, an example would be
East West Bancorp
East West Bancorp is the parent company of East West Bank. It is a publicly owned company with $42.1 billion in assets as of April 18, 2019. The company’s wholly owned subsidiary, East West Bank, is the largest publicly traded bank headquarter ...
and its primary subsidiary,
East West Bank
East West Bank (), the primary subsidiary of East West Bancorp, Inc., is the largest publicly traded bank headquartered in Southern California, United States. It was founded in 1973 in Los Angeles to serve the Chinese American community in Sou ...
.
Legal responsibility
Subsidiaries are separate, distinct
legal
Law is a set of rules that are created and are law enforcement, enforceable by social or governmental institutions to regulate behavior,Robertson, ''Crimes against humanity'', 90. with its precise definition a matter of longstanding debate. ...
entities for the purposes of
tax
A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, or n ...
ation,
regulation
Regulation is the management of complex systems according to a set of rules and trends. In systems theory, these types of rules exist in various fields of biology and society, but the term has slightly different meanings according to context. Fo ...
and
liability. For this reason, they differ from divisions, which are businesses fully integrated within the main company, and not legally or otherwise distinct from it. The ''
Houston Chronicle
The ''Houston Chronicle'' is the largest daily newspaper in Houston, Texas, United States. , it is the third-largest newspaper by Sunday circulation in the United States, behind only ''The New York Times'' and the ''Los Angeles Times''. With i ...
'' highlighted that the creation of a division "is substantially easier than developing subsidiaries. Because a division is an internal segment of a company, not an entirely separate entity, business owners create and end divisions at their whim. Also, because individuals in each division are employed by the same company, it's easier to modify staffing to fit with this setup".
See also
*
Brand
A brand is a name, term, design, symbol or any other feature that distinguishes one seller's good or service from those of other sellers. Brands are used in business, marketing, and advertising for recognition and, importantly, to create ...
*
Subsidiary
References
{{Authority control
Types of business entity