Critically discuss the relevance of the ownership structure of a firm Coursework

Critically discuss the relevance of the ownership structure of a firm and examine how this impacts on both the short-term and long-term strategies that are employed by business - Coursework Example At several instances, it is noted that the ownership structure of a firm has been affecting its steady growth and development at large. Moreover, the ownership structure of the firm is observed to function by developing the image and enhance the strategic development of the firm in both short and long terms (Jensen & Meckling, 1976). With this regard, the paper intends to elaborate on the relevance of the ownership structure followed in The Lego Group. The Lego Group is a private sector company founded in the year 1932. In accordance with its vision, the company’s business was majorly engaged in the development of the children’s cognitive skills through playing. The company has developed its image as a global enterprise over the tenure of 80 years and has developed itself, on of the leading manufacturer of toy in the world (1The LEGO Group, 2014). To develop a better understanding about the ownership structure of the company, a detailed analysis of its provisions and performances have been conducted in the following sections. Ownership structure provides a framework for the process of control and helps in developing a system of management of the firm. Ownership structure is therefore defined as the equity structure that depicts the holding rights of a company. This structure further defines the authority that a particular person has on an organisation. Moreover, the ownership structure depicts managerial abilities to control the different operations of the management and enhance the system overall, to suffice the changing needs of the contemporary business environment and adjust with the same, maintaining efficiency. Contextually, the ownership structure helps in identifying the corporate governance and in developing guidelines that in turn tends to shape the internal climate of the company influencing the investors’ confidence level as well as ensuring transparency in