Listen to a Business English Dialogue About A subsidiary
Olivia: Hey Joe, do you know what a subsidiary is in business?
Joe: Yes, Olivia, a subsidiary is a company that is owned or controlled by another company, known as the parent company.
Olivia: That’s right. Subsidiaries operate independently but are ultimately under the control of the parent company, which owns a majority of its voting stock.
Joe: Exactly. Subsidiaries are often established to expand the parent company’s business operations into new markets or to engage in specific activities.
Olivia: Right. They can also help the parent company manage risk by separating different business activities into distinct entities.
Joe: Absolutely. Plus, subsidiaries may enjoy certain tax benefits or legal protections that can be advantageous for the parent company.
Olivia: Yes, that’s true. However, it’s essential for the parent company to maintain proper oversight and governance over its subsidiaries to ensure compliance and alignment with its overall strategic objectives.
Joe: Definitely. Effective communication and coordination between the parent company and its subsidiaries are key to maximizing the benefits of this business structure.
Olivia: Absolutely. By leveraging the strengths and resources of both the parent company and its subsidiaries, businesses can achieve greater efficiency and success in their operations.
Joe: Absolutely. It’s all about leveraging synergies and creating value across the entire corporate structure.