Single Entity Or Multiple Entities?

One of the most frequent questions we get is whether to operate an organization through a single entity or multiple entities. There are quite a few overlapping and interlocking issues to consider. Big rocks include risk silos, insurance, organizational structure, and organizational/administrative capacity. These aren't binary checkboxes but levers that can dial up or down.

There is no one-size-fits-all answer to this question and there are significant pros and cons to each approach. Executives should analyze advantages and disadvantages of each, evaluate risk tolerance, and balance strengths and weaknesses of each position. Some general principles can guide you, however, in making the decision that's best for your organization. We've included some thoughts below based on our experience advising hundreds of clients through this analysis over the years.